- Global VC funding reaches US$120.7 billion across 7,579 deals
- The AI sector dominated VC investment activity.
- Global exit value climbed to $149.9 billion, driven by IPO activity
- Americas attracts a solid $85.1 billion in VC investment in Q3’25
- Asia continues to see muted VC investment, with only $16.8 billion in Q3’25
Global VC investment remains strong, driven by AI and supported by increasing exit activity
INDIA: Global venture capital (VC) investment rose from $112 billion in Q2’25 to $120 billion in Q3’25—marking the fourth consecutive quarter of robust investment, according to the latest edition of Venture Pulse from KPMG Private Enterprise, a quarterly report tracking investment trends globally across major regions around the world.
The Americas led with $85.1 billion, while Asia saw muted investment at $16.8 billion. AI continued to dominate VC activity, with significant funding rounds for AI model development and applications. The US accounted for most of the VC investment in the Americas, while Europe saw solid growth. Global exit value climbed to $149.9 billion, the highest since Q4’21, driven by renewed IPO activity. Looking ahead to Q4’25, global VC investment is expected to remain stable, with AI continuing to dominate. Robotics and defense tech will also continue to be focus areas.
The last time the global VC market saw $100 billion+ in investment for four quarters in a row was between Q4’21 and Q3’22. While overall deal volume eased slightly—reflecting a typical seasonal slowdown across the Americas and Europe—the broader market trajectory remained positive. Investor sentiment strengthened steadily throughout the quarter, buoyed by renewed optimism around liquidity pathways and a gradual reopening of exit markets in the Americas and Asia.
During Q3’25, the focus of VC investors globally concentrated on large deals.
AI continued to dominate VC investment activity in other regions as well in Q3’25. In addition to startups engaged in foundational AI model development, venture capital investors worldwide demonstrated increasing interest in AI-powered applications and sector-specific innovations. Beyond AI, defense technology and space technology garnered significant attention during the quarter, largely due to persistent geopolitical tensions. Health technology, quantum computing, and alternative energy also maintained strong investor interest throughout Q3’25.
Regionally, the Americas led global VC investment, attracting $85.1 billion across 3,474 deals in Q3’25. Within the Americas, the United States accounted for $80.9 billion across 3,175 deals. Europe attracted the second-largest share of VC funding during the quarter—$17.4 billion across 1,625 deals—overtaking Asia, where VC investment remained somewhat sluggish at $16.8 billion across 2,310 deals.
“AI is obviously the biggest ticket right now for VC investors globally. If startups aren’t embracing AI in some way, shape, or form, it’s very difficult for them to attract attention,” said Conor Moore, Global Head, KPMG Private Enterprise, KPMG International. “Many of the industries where we’re seeing strong investment are being driven in part by AI-driven solutions—like defencetech and healthtech—or by their importance to the AI ecosystem—like energy and datacentres.”
Q3’25 — Key highlights:
- Corporate VC participating investment increased from $56.1 billion in Q2’25 to $58.6 billion in Q3’25. The United States accounted for a large share of this total ($37.7 billion), marking its fourth consecutive strong quarter of CVC-associated investment. Europe reached a five-quarter high of $9.5 billion in CVC participating investment during Q3’25, while Asia continued to see muted CVC-related investment at $9.1 billion.
- Software remained the leading sector for VC investment.
- Global exit value climbed from $119.2 billion in Q2’25 to $149.9 billion in Q3’25—the highest level seen since Q4’21. At a regional level, U.S. exits rose from $71.0 billion to $74.5 billion quarter-over-quarter, while Asia saw a sharp increase from $28.7 billion to $38.0 billion. Europe also recorded significant growth, with exit value rising from $17.3 billion to $27.8 billion between Q2’25 and Q3’25.
- Global VC fundraising remained exceptionally weak, totaling just $80.7 billion at the end of Q3’25—putting it on pace to fall below 2024’s eight-year low of $196.1 billion.
Key highlights from India:
- India sees VC investment slow in Q3’25 amid an uncertain geopolitical environment.
- India experienced a banner quarter for exits in Q3’25, with exit value surging to a high not seen in at least seven years.
- While interest in India remains high, VC investors have found it difficult to predict what might happen day-to-day, leading them to hold back from making any major funding decisions.
- Despite the soft VC investment in Q3’25, there continued to be optimism in the market given the growth in startup exit activity — particularly in terms of IPO exits.
- During the quarter, IPO activity was quite strong compared to previous quarters.
- Given India’s strong macros and vibrant capital market, should trade uncertainties be resolved, there is good optimism that VC investment will begin to rebound. Further IPO activity is also expected over the next few quarters in India.
Commenting on the India findings, Nitish Poddar, Partner and National Leader, Private Equity, KPMG in India, said, “VC investment results in India this quarter were driven by the speed bump that was the US tariffs, but people expect that by the end of November, that will settle. And macros are still strong, the capital markets are still vibrant, and a lot of capital has been raised that will need to get deployed — so funding should increase as uncertainties calm. But investors are going to be focused heavily on the path to profitability and cash flows because without those, you won’t get a capital market exit.”
AI continues to power the VC market globally
VC investors continued to double down on AI in Q3’25, with companies developing AI models and platforms attracting many of the largest funding rounds of the quarter. The surge in AI investment extended well beyond the U.S. and Europe. Beyond these headline transactions, AI-focused startups across regions continued to attract significant VC funding rounds, reflecting the growing breadth and attractiveness of AI-focused solutions.
One of the most encouraging developments of Q3’25 was the revival of IPO markets—particularly in the US—which provided long-awaited exit opportunities after years of subdued activity. The number of successful listings not only validated valuations in select high-growth sectors but also reinforced investor confidence that the exit window for VC-backed companies is reopening. For VC investors, the combination of sustained capital deployment and healthier exit conditions suggests a more constructive and balanced venture capital environment heading into 2026.
Steady course expected heading into Q4’25
Looking ahead to Q4’25, global VC investment is expected to remain relatively stable, fueled by continued momentum in AI model development, industry-specific AI applications, and AI infrastructure. Robotics is also anticipated to gain further traction among VC investors over the coming quarter. Given AI’s dominance, companies without AI-driven capabilities could find it increasingly challenging to attract funding. However, in regions such as Africa, Latin America, and Southeast Asia, fintech is expected to remain the primary investment focus.