Investors pour $27.1 billion into AI startups, defying a downturn

For two years, many unprofitable tech startups have cut costs, sold themselves or gone out of business.

- ERIN GRIFFITH

But the ones focused on artificial intelligence have been thriving.

Now, the AI boom that started in late 2022, has become the strongest counterpoint to the broader startup downturn.

Investors poured $27.1 billion into AI startups in the United States from April to June, accounting for nearly half of all US startup funding in that period, according to PitchBook, which tracks startups. In total, US startups raised $56 billion, up 57 percent from a year earlier and the highest three-month haul in two years. Al companies are attracting huge rounds of funding reminiscent of 2021, when low interest rates pushed investors away from taking risks on tech investments.