North America Dominates AI Venture Capital Despite Policy Challenges
Despite an increasingly challenging environment for AI research and development in the U.S., North America continues to attract the lion’s share of global AI venture capital, according to PitchBook data.
Between February and May 2025, venture capitalists invested $69.7 billion in North American AI and machine learning startups across 1,528 deals, dwarfing the $6.4 billion invested in European AI ventures (742 deals) and $3 billion in Asia-based startups (515 deals) during the same period.
In 2024, North America secured 75.6% of global AI venture funding ($106.24 billion), a share that rose to 86.2% ($79.74 billion) in 2025, underscoring its dominance.
This trend persists despite U.S. policies under President Donald Trump that have created uncertainty for AI innovation. The administration has slashed funding for AI-related scientific grants, restricted foreign AI students’ access to U.S. education, and threatened to cut federal support for university AI labs.
Additionally, retaliatory tariffs have disrupted markets, making it harder for risky AI ventures to thrive. These policies have drawn criticism, including from AI pioneer Geoffrey Hinton, who publicly called for billionaire Elon Musk’s expulsion from the British Royal Society due to his influence on U.S. scientific institutions.
One might expect Europe, which has pledged significant investments to become a global AI leader with successful startups like Mistral and Aleph Alpha, or Asia, home to companies like DeepSeek, to see increased venture capital interest.
However, no significant shift in investment has occurred. Factors like export controls limiting AI chip access in Asia may contribute to its lower funding levels.
The significance of North America’s dominance lies in its ability to maintain investor confidence despite political headwinds. Investors appear to bet on U.S. innovation for high returns, reinforcing its position as the global AI hub.
For businesses and startups, this means continued access to substantial funding in North America, but it also highlights the challenges of navigating an unpredictable regulatory landscape.
For users, the concentration of investment could accelerate AI-driven innovations in products and services, though global disparities in funding may slow progress elsewhere.
FAQ
Why is North America leading in AI venture capital?
North America’s established tech ecosystem, robust investor networks, and history of AI innovation continue to attract significant venture capital, despite regulatory challenges.
How do U.S. policies affect AI development?
Policies like reduced research funding and restrictions on foreign talent create uncertainty, potentially slowing AI progress, though investor confidence in U.S. startups remains strong.
