AI venture funding continued to surge in third quarter, data shows

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(Reuters) -As the rush towards AI-related companies continues on Wall Street, data from Crunchbase showed on Monday that the sector enjoyed a bulk of venture funding in the third quarter, with names including Anthropic raking in billions.

BY THE NUMBERS

Global venture funding in the third quarter increased 38% year-over-year to $97 billion, increasing slightly from $92 billion in the second quarter.

About 46% of global venture funding for the third quarter went towards funding AI companies, with 29% invested in solely Anthropic.

The three largest venture rounds in the quarter ended September were raised by foundation model companies: $13 billion by Anthropic, $5.3 billion by xAI and $2 billion from Mistral AI.

WHY IT’S IMPORTANT

The craze for AI-related companies has swept across Wall Street this year and was largely responsible for pushing the main stock indexes to record highs.

ChatGPT-parent OpenAI reportedly became the most valuable private company in the world last week with a valuation of $500 billion.

Crunchbase data shows other private players in the AI chatbot space were leading funding in the last quarter.

Funding for U.S. companies dominated in the quarter, with $60 billion worth of global venture capital going to U.S.-based companies.

OTHER SECTORS

Funding for the hardware sector was the second-largest in the quarter, with large rounds raised by robotic, semiconductor, quantum and data infrastructure companies totaling $16.2 billion, according to Crunchbase’s data.

Healthcare and biotech raised $15.8 billion in venture funding, making it the third-largest sector in the quarter.

(Reporting by Shashwat Chauhan in Bengaluru; Editing by Maju Samuel)