If your startup’s name doesn’t include “A.I.”, good luck

Venture capital has always had its cycles of hype, but in 2025 one thing is clear: if you’re not building around artificial intelligence, the money isn’t flowing your way.

According to Bloomberg, citing data from PitchBook, venture capitalists poured a record $192.7 billion into AI-focused startups in the first nine months of 2025. That staggering sum represents more than half of all global VC funding this year, out of a total of $366.8 billion. In the U.S. alone, 62.7% of all venture capital in Q3 went to AI firms. Globally, the share stood at 53.2%.

The headline deals went to the usual suspects. Anthropic, one of the most prominent AI labs, raised $13 billion in a single quarter, while other large language model players and infrastructure providers secured multi-billion dollar rounds.

Winners and losers

But behind the blockbuster figures lies a sharper reality: capital is becoming more concentrated. PitchBook’s research shows that the number of startups actually raising funds is at one of the lowest levels in years, and fewer venture funds are raising new capital themselves.

Kyle Sanford, director of research at PitchBook, summed it up bluntly: “Everywhere we look, the market is bifurcated. You’re in AI, or you’re not. You’re a big firm, or you’re not.”

For smaller startups outside the AI spotlight, the environment has never been tougher.

What this means for Africa

For African entrepreneurs, the message is twofold. On one hand, global investor enthusiasm for AI could mean more opportunities for African ventures that can demonstrate credible applications of machine learning and automation—whether in fintech, healthtech, agriculture, or logistics. Already, startups leveraging AI for crop disease detection, mobile credit scoring, and fraud prevention are drawing international attention.

On the other hand, the wave of capital concentration poses risks. With VC money overwhelmingly chasing global giants, Africa’s early-stage ecosystem could see even scarcer funding, unless local investors step in to support companies solving regional challenges. The danger is that African founders may feel compelled to slap “AI” onto their pitch decks—whether or not it’s core to their business—in order to get a hearing from global funds.

The AI boom is reshaping not only the flow of capital but also the psychology of entrepreneurship. For African businesses, the challenge will be to ride the wave without losing focus on fundamentals: building companies that solve real problems at scale. If “AI” is in your name and your DNA, this is your moment. If not, the climb to investment just got steeper.