Venture capital investment in U.S.-based artificial intelligence startups hit a record $97 billion in 2024, underscoring the growing dominance of AI within the tech industry.

High-profile companies such as xAI, OpenAI, and Anthropic, spearheaded by figures like Elon Musk, drove the investment surge, marking an unprecedented year for funding in the sector. Nearly half of the $209 billion raised by American startups in 2024 went to AI-focused firms, according to data released by PitchBook on Tuesday.

This represents the largest share in history and highlights the rapid expansion of the AI sector. Overall, startup funding grew by one-third compared to 2023, despite challenges faced by startups in traditional areas like enterprise software.

Venture capital firms themselves raised $76.1 billion across 508 funds, the lowest number of funds since 2014 and the smallest total raised since 2019. This disparity reflects a polarized venture capital landscape: while established firms and prominent AI startups attract substantial funding, smaller or less visible companies struggle to secure capital.