Venture Capital Rebounds: Why Is Funding Harder to Secure?

The Rebound Is Only in the Totals

Global venture capital deal value rose by 7.7% in 2024, which sounds like long-awaited good news. Yet within the same dataset, after excluding a few mega-deals in the U.S. generative AI sector, deal volume actually fell by 4.4%, and the number of deals has declined for the third consecutive year.

This is where founders’ on-the-ground experience clashes with the headline numbers. A larger total amount of money doesn’t mean it’s easier for more companies to raise funds. Data from WIPO’s Global Innovation Index 2025 suggests something else: a few mega-projects are inflating the totals, while funding opportunities themselves continue to shrink.

If you think of the VC market as a river, the water level in 2024 appears to have risen; but the water isn’t spreading into more tributaries—it’s being sucked into a few deeper main channels. For founders standing in the tributaries, it feels harder than ever for the water to reach them.

Money Is Returning to a Few Places

The first narrowing is geographic. According to Pack’s slice data, North America’s share of global VC rebounded from 48% in 2023 to 72% in 2024. This isn’t just normal regional fluctuation; it’s a reconcentration of capital toward North America from a more dispersed state.

This changes the fundraising environment for founders. When global deal value rises, non-North American founders don’t necessarily benefit in tandem; if the new capital primarily lands in North America, other markets may still see fewer meetings, longer decision cycles, and more demanding terms.

This also explains why the phrase ‘global VC rebound’ can be misleading. The global total is an aggregated figure that lumps together U.S. and non-U.S., AI and non-AI, mega-deals and regular deals. What founders face, however, is not the global average, but the small pool of capital specific to their region, sector, and stage.

Money Is Also Returning to a Few Sectors

The second narrowing is sectoral. According to Pack’s slice data, sector concentration reached a historic high in 2024, with about 50% of VC funding flowing into software and IT-related areas.

This means that ‘there’s more VC money again’ doesn’t equate to ‘there’s more money for all startup directions.’ If a startup isn’t in the most watched baskets like software, IT, or AI, it may not be facing a recovery, but rather being pushed out of sight.

This kind of concentration is self-reinforcing. Mega AI deals inflate the totals, the media and the market interpret those totals as a rebound, and more capital seeks safety in already proven hot sectors. The result is that capital continues to concentrate in hot areas, making it even harder for non-hot sectors to get attention.

Fewer Deals, Fiercer Competition

The real fundraising difficulty founders feel often stems from fewer ‘deal-making windows’ rather than a lack of global paper value. The number of deals falling for the third consecutive year shows that the number of companies getting checks is shrinking; excluding a few AI mega-deals, deal volume dropped 4.4%, indicating that regular deals haven’t recovered in tandem.

This leads to a counterintuitive outcome: as the market total rises, competition among ordinary founders actually intensifies. The same or even more projects are competing for fewer regular deal slots, while a few top AI or software companies take larger individual checks.

R&D metrics also provide context. Core data in the Pack places VC and R&D metrics in the same slice: innovation investment isn’t expanding evenly, and some investment and innovation indicators are under pressure in 2025 observations.

So, the money hasn’t disappeared; it’s just become pickier. VCs are still investing, but they’re favoring the few companies that can tell a story of massive growth, wear an AI or software label, and are located in markets where capital is more concentrated.

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Source institutions：World Intellectual Property Organization

This content is for reading and understanding research reports. It does not constitute investment advice or trading signals.