NeuralStackFunding for North American startups fell sharply in the third quarter, but the decline was driven mainly by the absence of extraordinary financings for OpenAI and Anthropic. Investors put $92 billion into seed-through-growth rounds for U.S. and Canadian startups, according to Crunchbase data. That was 35% below the prior quarter, yet 50% above the same period a year earlier.
The number of deals remained relatively steady, with late-stage and early-stage round counts close to prior-quarter levels. Artificial intelligence continued to dominate investor attention, accounting for roughly two-thirds of total funding. Large rounds for Databricks, Safe SuperIntelligence and Crusoe helped drive the quarter’s totals.
Late-stage and growth funding reached $66.45 billion, about a third higher than a year earlier but well below the first and second quarters. Those earlier periods were lifted by OpenAI’s $110 billion financing and Anthropic’s $65 billion round. In Q3, Databricks raised $5 billion, Crusoe secured $3.9 billion, The Boring Co. received $3 billion and Cognition raised $2 billion.
Early-stage investment totaled $20.6 billion. Although that represented a sequential decline from the previous quarter, it remained well above prior-year levels, supported by several unusually large rounds. River AI raised $1.1 billion in a Series A, Valar Atomics secured $660 million in a Series B, and Fab2 collected $500 million in a Series A.
Seed activity also remained substantial, with at least $5 billion invested in seed, angel and pre-seed rounds during the quarter. The preliminary figure was slightly below both the prior quarter and the year-ago period, though it may rise as additional seed deals are added to the dataset. Physical AI startups Walden Robotics and Veeda AI stood out with seed rounds of $300 million and $90 million, respectively.
Why this matters
The quarter’s numbers show how heavily venture funding now depends on a small number of AI companies raising exceptionally large rounds. AI-focused startups received $61 billion in Q3, a total that was down from the previous two quarters but still among the highest on record. The concentration suggests that a softer aggregate funding result does not necessarily signal a broad deterioration in investor appetite.
Exit activity offered a mixed picture. M&A was strengthened by major AI transactions, led by Nvidia’s $12.93 billion acquisition of Hugging Face, AMD’s stock deal for World Labs valued at about $8.2 billion, and Stripe’s reported acquisition of OpenRouter for roughly $7.5 billion. In all, 11 North American startup acquisitions had reported prices of at least $1 billion.
Public markets were considerably quieter. Seventeen venture-backed North American companies listed on major U.S. and Canadian exchanges in Q3, raising just under $4 billion collectively, with the largest offerings coming from biotech companies Adarx Pharmaceuticals, Braveheart Bio and Electra Therapeutics. With no blockbuster technology debuts during the quarter, attention remained focused on the prospect of major AI companies eventually entering the public markets.