Artificial intelligence startups appear to be booming. Global venture capital increased 20% in 2019, while acquisitions jumped 24.8% from the previous year.
According to a new report from CB Insights, AI companies raised $26.58 billion across 2,235 deals in 2019, up from 1,940 deals the previous year that totaled $22.148 billion.
The 2019 numbers included 10 rounds of more than $100 million that went to companies such as Automatic Anywhere, Wish, and Horizon Robotics. While 44% of AI funding is at the seed stage, there were 24 unicorns in the space by the end of 2019, up from 19 at the end of 2018.
As the AI surge continues, the U.S. remains in the lead for funding but is losing ground in the overall global picture. CB Insights said U.S. startups raised 39% of the global AI venture capital, or about $10.36 billion in 2019. (Note: A separate report in January from the National Venture Capital Association found that AI companies in the U.S. raised $18.457 billion in 2019. Each organization has different methodologies for defining what is considered an AI startup.)
The U.S. share was down from 40% in 2018 and 70% in 2014, according to CB Insights. The next two biggest rivals are China with 13.1% of the funding and the U.K. with 7.1%. But the “Other” category stands at 30.5%, indicating just how widely distributed such startups are.
Health care, finance, insurance, and retail remain the top focus for these AI companies.
Interest in AI has also ignited an acquisition frenzy. In 2019, there were 231 acquisitions of AI companies and 10 IPOs. That compares to 185 acquisitions in 2018 and seven IPOs. Notable deals included Intel buying AI chip startup Habana Labs for $2 billion and McDonald’s snapping up Dynamic Yield for a reported $300 million.