The company had grown the top line, but not the margin. It was scaling itself out of business.

This kind of story is becoming more common as we move into the AI era. The old SaaS playbook of build a great app, charge monthly and let infrastructure fade into the background, doesn’t hold up when your core cost scales with usage.

AI has reshuffled the value chain, and for startups, this shift is existential.

The AI stack is deep and margin has moved

In traditional SaaS, most of the value was captured at the application layer. Today, AI companies operate in a much deeper stack:

1. Energy infrastructure: Data centers, cooling and power (see ’s $10 billion investment in data center energy in Virginia);
2. Chips and hardware: ’s H100s, TPUs, scarce and expensive;
3. Cloud platforms: Azure, , with priority GPU access;
4. Models: OpenAI, Anthropic and increasingly open-source players;
5. Vertical AI solutions: Can be used as low code/no code platforms to build specific AI applications; and
6. Applications: The user-facing product, where most AI startups still live.

But unlike the past, margins no longer concentrate at the top, close to the end user. They now often sit below the surface, especially in layers where scarcity exists such as hardware, compute and exclusive model access.

So what can startups do when they don’t own the infrastructure or the models?

Three moves founders can make to stay in the game

1. Own your data. It’s your new moat

You don’t need to train your own foundation model, but you do need to own the inputs that make your product valuable.

If you’re in a vertical such as healthcare, finance, real estate or legal, your advantage is proprietary, structured data. Fine-tune open models. Build lightweight adapters. Use your customer workflows to continuously collect differentiated data. The value is in the dataset.

2. Price for usage, not access

That founder’s $800,000 cloud bill happened because they were charging like a SaaS company but operating like a compute company.

In AI, usage drives cost. That means flat-rate subscriptions don’t work. Founders must embrace pricing models that align value delivered with cost incurred:

• Per-output or per-token billing;
• Compute-aware pricing tiers; and
• Charging for high-cost features such as image generation or live inference.

Track gross margin by feature, not just customer.

3. Avoid model lock-in. Design for flexibility

Tying your roadmap to one model provider like OpenAI or Anthropic is risky. Latency, pricing and policy changes can all blindside you.

Instead, build with model abstraction in mind. Route across providers, fine-tune open-source backups, and negotiate contracts with leverage. Flexibility is not just technical. It is a business hedge.

�� is a strategic adviser to tech companies and investors, specializing in strategy, growth and M&A, a guest contributor to Crunchbase News, and a seasoned lecturer. Learn more about his advisory services, lectures and courses at . for further insights and discussions.

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The AI boom was particularly concentrated in North America, which saw a 21% jump in startup funding last year, while venture investment in Asia dropped to a 10-year low.

That’s the broad takeaway from Crunchbase’s 2024 venture funding data. Other trends emerged from our reporting and data, too, including a cooler seed funding environment and hotter M&A market.

Let’s take a look, with a dozen charts that underscore the major trends in startups leading into 2025.

North America leads AI investment, Asia suffers

Artificial intelligence took the lion’s share of global startup funding in 2024, with about 1 in 3 venture dollars going to an AI-related startup.

All told, a staggering $100 billion was invested into AI-related startups globally in 2024, per Crunchbase data, with a handful of companies including , , and alone raising tens of billions dollars.

The growth in AI investment pushed total global venture funding in 2024 to nearly $314 billion — a notch higher than the $304 billion invested in 2023. (While that’s above the pre-pandemic year of 2019, startup funding still remained below 2018 and 2020 levels.)

Last year’s funding gains were also not equally distributed.

Funding to startups in North America jumped 21% year over year to more than $184 billion, driven by those big AI deals. The AI boost was particularly obvious in Q4, with about 62% of all North American startup funding going to companies in the space, per Crunchbase data.

Conversely, investment in Asia-based startups tanked to a 10-year low in 2024, largely due to a big decline in venture funding dollars in China. The Red Dragon also hit a decade-low for funding last year, with venture investment to China-based companies falling 32% year over year to $33.2 billion.

Europe’s startup funding stabilized last year, with an estimated $51 billion invested in startups on the continent, down about 5% year over year but above pre-pandemic funding levels, including 2020.

Latin America also settled somewhat, with fintech remaining as a particularly strong sector for the region.

Familiar names among top investors

The busiest startup investors overall in 2024 were generally the top investors in AI companies.

That includes (a16z), , and , all of which appear on both our lists of busiest startup investors in 2024 overall, and most-active investors in AI startups specifically.

Seed funding dips despite AI gains and larger deals

Seed-stage investment in the U.S. dipped in 2024, even as overall venture funding gained, underscoring a more difficult environment for the very earliest-stage startups.

Our data also shows that startups are, on average, staying longer at the seed stage and that fewer startups are progressing to Series A (or an exit) — raising their risk of failure.

That said, those startups that do raise seed rounds are generally raising bigger deals at this stage than they did in the past.

And while industries including food tech, augmented and virtual reality, and cannabis-related tech saw significant drops in seed funding last year, other sectors bucked the trend and continue to get investor interest, including robotics, AI, legal and accounting-related startups.

Unicorns surpass $1T in funding, but new creations dwindle

Private, venture-backed companies with billion-dollar valuations collectively surpassed $1 trillion in funding raised by the end of 2024, according to The Crunchbase ������Ƶ.

The milestone underscores the massive influx of funding that has gone to large and late-stage startups in recent years, including, of course, the billions invested in the AI giants.

Unicorn creation, however, has also tapered off significantly as venture funding has fallen off its peak of three years prior.

And with IPOs still few and far between, many unicorns minted during 2020 and 2021 are now stabled on the ������Ƶ with outdated valuations that will no doubt be called into question should they make a run at the public markets this year.

Startup M&A heats up

Still, while IPOs remain rare, there is one bright spot on the exit front: M&A involving venture-backed startups ticked up 7% last year, Crunchbase data shows.

The fourth quarter was particularly active, marking the most-active deal-making quarter in seven quarters.

What’s next?

As we enter 2025, we’ll be watching closely to see how these trends play out — including whether the scare last month puts a dent in AI investing (or only in the space, as some predict), whether the IPO markets thaw, and whether more startups again start to flourish beyond the seed-stage.

Related Crunchbase Pro lists:

Related reading:

• Led By A16Z, Active Investors Upped Their Game In 2024
• North American Startup Funding Spikes To Close 2024��
• Eye On AI: Who Were The Most-Active AI Investors In 2024?
• Europe’s Startup Funding Stabilized In 2024, But Remains Far Off Market Peak
• Latin America Startup Funding Ticked Higher In 2024
• M&A Activity Involving VC-Backed Startups Picked Up In 2024
• Seed Rounds Got Larger Through The Downturn. Why Is That?
• Seed Funding Rose In These Spaces
• Seed Funding Fell Hard In These Sectors
• Crunchbase ������Ƶ Tops $1T In Funding Raised
• Will DeepSeek Burst VC’s AI Bubble?
• Forecast: 2024 Was Slow For Tech IPOs, But 2025 Could Be Different
• Far Fewer Seed-Stage Startups Are Graduating To Series A — Raising The Risk Of Failure

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This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out the biggest funding rounds of last week here.

Thus far 2025 has come roaring in as far as large rounds go. Last week more than a dozen companies raised $100 million or more. This week there are fewer, but not by many, as companies needed to raise at least $100 million to make this list.

1. , $320M, biotech: Medical data research company Truveta landed a massive $320 million investment from , and 17 U.S. health systems as it continues to build the world’s largest genetic database. The deal values privately held Truveta at more than $1 billion. Truveta aggregates medical records data from its partner institutions to link treatments with outcomes and other health aspects. Its platform is updated daily. Founded in 2020, the company has raised $515 million, .

2. , $260M, space: Reusable rocket startup Stoke Space locked up a $260 million Series C as the space tech sector looks to build off a successful 2024 in terms of fundraising. The Kent, Washington-based company is developing fully reusable rockets that make low-cost access to and from space possible. It intends to use the new funding to complete construction of its�� Nova launch vehicle at the Cape Canaveral Space Force Station in Florida. The new round involves new and existing investors including , , and the , among others. Founded in 2019, Stoke has raised more than $480 million, per the company. After a slow-ish 2023, last year saw a bit of a bounce-back for the space tech industry in venture funding. In 2024, VC-backed space tech startups raised $8.3 billion, per Crunchbase . That number is a 17% jump from the $7.1 billion raised in 2023, but short of the $9.2 billion invested in 2022.

3. , $200M, genetics: Colossal Biosciences, a de-extinction startup looking at ways to bring back the dodo bird and the woolly mammoth, raised a $200 million Series C at a $10.2 billion valuation. The new cash infusion came from , a holding company jointly led by and . The Dallas-based startup, which launched in 2021, plans to use the money to continue to advance its genetic engineering technologies, as well as grow its software and hardware solutions for applications involved with de-extinction, conservation and human health care. The company said bringing back extinct animals could allow for a better understanding of evolutionary change in other species, and that genetic engineering applications also will help enhance food production and reduce environmental impact. It was January 2023 when Colossal Biosciences raised a $150 million Series B to further its de-extinction platform. The round was led by Tull’s . Since launching in September 2021, Colossal has raised $435 million, per the company.

4. , $175M, biotech: Epigenetic programming startup Tune Therapeutics raised a huge $175 million round led by ,, and . The funding is expected to advance development of the company’s existing pipeline, which is currently anchored by its clinical-stage epigenetic silencing drug for chronic Hepatitis B. The cash also will be used to�� support the development of additional gene, cell and regenerative therapy programs. Founded in 2020, the company has raised $215 million, .

5. , $170M, space: Space infrastructure startup Loft Orbital raised a $170 million funding round led by and . The San Francisco-based company builds satellites to which customers can attach components like sensors and telescopes. Founded in 2017, the company has raised $326 million, .

6. , $165M, biotech: Raleigh, North Carolina-based Caidya, a mid-sized clinical research organization, locked up a�� strategic growth investment of $165 million from funds managed by , a U.S.-based healthcare investment firm. Caidya offers biopharma companies an array of clinical trial services from regulatory strategy and submissions through post-approval surveillance. Founded in 2021, this is the first round raised with a disclosed amount, .

7. , $150M, crypto: San Francisco-based Phantom Technologies, a crypto wallet startup, raised a $150 million round led by and , valuing the startup at $3 billion. Founded in 2021, the company has raised $268 million, .

8. (tied) , $100M, electric vehicle: Los Angeles-based electric commercial trucking startup Harbinger raised a $100 million Series B co-led by and . Founded in 2021, the company has raised more than $200 million, .

8. (tied) , $100M, data: San Francisco-based Instabase, which creates artificial intelligence-powered solutions to help companies handle unstructured data, locked up a $100 million Series D led by . Founded in 2015, the company has raised $292 million, .

8. (tied) , $100M, biotech: Seattle-based Umoja Biopharma, a developer of in vivo cell therapies, announced the closing of a $100 million Series C co-led by and. Founded in 2019, the company has raised $363 million, .

Big global deals

The biggest funding round this week went to a China-based firm.

• , which provides internet-enabled solutions for the textile industry, raised a $460 million Series C.

Methodology

We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the seven-day period of Jan. 11 to Jan. 17. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

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Total funding to VC-backed cybersecurity startups hit nearly $11.6 billion last year, per Crunchbase . That tops the $8.1 billion raised by startups in 2023, though remained well under the $17 billion invested in 2022.

Fewer deals, but big bucks

While dollars were up for the year, deal flow slowed notably. Only 639 rounds were announced last year, a 22% decline from 2023 and a 37% drop from 2022.

Despite the slowdown in the number of rounds, last year also saw a slew of huge deals completed in cyber. In fact, there were 29 rounds of $100 million or more raised by cybersecurity startups — compared to only 18 in 2023. Those rounds included:

• Cloud security startup locked up the biggest cybersecurity round of the year as it raised $1 billion at a $12 billion valuation. The round — announced just as the industry’s was getting underway in San Francisco in May — was co-led by , and .
• France-based , a managed security service provider, raised a venture round of approximately $516 million in June.
• In August, secure content company raised a $456 million round from (which also participated in a $250 million round) and . While the company did not specify a valuation, it did state it was a minority investment, meaning its valuation is greater than $1 billion.

Fourth quarter flat

The last quarter of the year did not provide a huge boost to 2024’s funding totals, as the $2.2 billion invested in 124 deals was about even with Q3, according to Crunchbase data. The number, however, did represent a 29% uptick from Q4 2023 when only $1.7 billion was invested in 170 rounds.

The biggest deals of the quarter included:

• In December, raised more than $300 million at a valuation of over $5.6 billion, as�� the startup continues to look to apply quantum technology to AI development.
• In November, New York-based data security startup closed a $300 million Series D led by and at a $3 billion valuation. It was just April when Cyera raised a $300 million Series C led by at a $1.4 billion valuation.
• Finally in October, cybersecurity firm closed a $200 million Series D led by and . The round boosts the company’s valuation nearly 25% to $4.2 billion. The San Francisco-based startup last raised�� a $300 million private equity round in 2021 led by at a $3.4 billion valuation.

What it means

Although year-to-year numbers are higher, there do seem to be some issues pressing on cybersecurity funding numbers that cannot be ignored.

The fourth quarter last year represents the seventh consecutive quarter deal flow has slowed. It seems that while investors are betting big money on a select few companies, fewer companies are getting cash and that could soon cause some havoc in what is a typically well-funded startup environment in cyber. If funding slows more and exits remain difficult, startups may have to look at shuttering as the lone possibility.

Also, there is a real possibility that some VCs who looked at cyber are instead focusing their time and efforts on AI — which just completed an unheard of fourth quarter regarding venture investment. If investors — or at least their fund’s money — find AI more compelling right now, cybersecurity startups may find fundraising difficult, unless of course they too have an AI play.

Whatever the case, there is no denying fewer cyber companies are getting funded — and that could spell trouble for those founders who are looking for cash in 2025.

Related Crunchbase Pro list:

Related reading:

• Cloud Security Firm Wiz Raises $1B At $12B Valuation
• Cyber Startup Kiteworks Locks Up $456M From Insight, Sixth Street
• Cybersecurity Startup Abnormal Security Locks Up $250M At $5.1B Valuation
• Data Security Startup Cyera More Than Doubles Value To $3B In 7 Months
• Cyber Startup Armis Security Raises $200M At $4.2B Valuation
• Cybersecurity Funding Plummets 51% In Q3
• Eye On AI: AI Venture Funding Shattered Quarterly Records In Q4

Methodology

Cybersecurity is defined by the industries of network security, cloud security and cybersecurity, according to Crunchbase data. Most announced rounds are represented in the database; however, there could be a small time lag for rounds reported late in the quarter.

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Boston-based , , ,��, and several angel investors also participated in the round. Accel’s will join the company’s board as part of the financing.

The San Francisco-based company says it “gives more people the ability to create powerful websites and applications without having to write code.” With over 45,000 customers, including and , Webflow says it is profitable and, according to , has been for two years with annualized revenue of over $20 million. It plans to use the new capital to build out its executive team and hire in general. (The company currently has over 120 employees, up from about 70 a year ago, according to CEO and co-founder ).

Webflow also wants to continue growing its customer base, and plans to invest in “extensibility, accessibility, performance, security, and data privacy” to do so. Current customers range from individual freelancers to Fortune 500 companies. They include Johnson & Johnson, Yelp, and Adobe, among others.

A $72 million round for a company of 120 people is quite outsized; presumably the firm will hire rapidly to scale its workforce to match its capital base. Or in more crass terms, the company will quickly expand its spend. (This is a standard move post-financing for nearly any startups, we’re merely reacting to the scale of new funds that Webflow now has at its disposal compared to its new capital base.)

In a , detailed the company’s early struggles, noting the company launched almost six years ago. Several months later, the company was accepted into . But the company’s trio of co-founders were struggling. All had left their previous jobs, according to Magdalin, “and had no meaningful income.” Magdalin had cashed out his 401-K to pay for surgery for one of his daughters, and he and his wife “had racked up over $50K in credit card debt.”

Webflow eventually landed $2.9M from several seed funds and angels, with contributing more than half its seed round.

Not Alone

While Webflow’s Series A is certainly outsized compared to historical norms, the company is in raising such a huge sum for what should be its first institutional round (the real definition of a Series A). Indeed, some other entrants for large nine-figure Series A financings in 2019 include for biotech company , for London-based fintech startup , and for South Korean cryptocurrency exchange platform .

The list continues. Turning to China, for example, raised a , for supply chain focused business and more.

In short, yes, Webflow’s Series A round is abnormal historically. It is also perfectly normal when it comes to 2019.

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The SF-based startup has raised $100M, bringing its total known funding to $170M. And with the check comes a mission beyond rows and columns in a spreadsheet: an aim to democratize software.

, Airtable’s CEO and co-founder, told Crunchbase News that his startup aims to take “all of the complexities of interacting with a relational database and exposing those to an end-user in the most intuitive possible form.” Essentially, Liu is saying that if you can grok Excel, you should be able to grok Airtable.

However, manipulating that data into a product or useful piece of software mostly remains in the domain of developers. That doesn’t mean some companies haven’t tried making building apps on top of databases easier. , which automates workflows for hundreds of SMBs across the nation, also boasts about its ability to make software creation accessible to end users. But according to Liu, Quickbase and other drag-and-drop software creation tools are more “low-code app platforms that are frankly never going to see bottoms-up adoption.”

“If you showed Quickbase to twenty randomly selected people from a company or a cross-section of America, I think zero out of twenty, more times than not, would be able to go or want to go build the application they need on top of Quickbase,” Liu explained, crediting Airtable’s more considered approach to product development as a big part of its differentiation from more established players.

Furthermore, Liu doesn’t believe that an injection of cash dwarfing all of its prior total funding rounds will impact the company’s ability to execute on new, user-friendly features.

“We were deliberate about thinking through who are the right people to involve at this stage to help us scale to the next five levels of the company,” Liu explained. That said, investors do like cash as much as they like great products. And on revenue metrics, Liu said that the company is “fortunate enough to be in a position where, reduced to those numbers, we look very good as a business.”

Assuming that Airtable chose the right investors, a solid financial footing paired with an influx of cash should give the startup room to explore its software creation ambitions. It plans to do so by investing more resources into “Blocks,” which are essentially mini-apps within Airtable, and opening up the platform to “third-party developers and customers.”

It’s an ambition that’s fraught with potential problems. One only need look at the list of poorly maintained Google Doc Add-ons and Twitter’s lackluster handling of over the years to understand the potential perils, and responsibility, of calling yourself a platform. But the use of the buzzword isn’t lost on Liu.

“Not all platforms are created equal. It’s kind of in-vogue to call yourself or something a platform because it sounds more ambitious, more empowering, and more important to do than build a product,” said Liu.

Even without third-party developers, Airtable plans to commit internal resources to its Blocks platform, likely an encouraging sign for developers.

“We’re going to have a full-time team… to go and just build useful blocks on top of our own platform,” said Liu.

To this writer, in many ways, Airtable is attempting to create a new economy of app development built off of its accessible database. It’s a tall order that will require millions, and this is the bull market to raise it in.

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