From stopping cyberattacks to operating autonomous vehicles to visually searching through a wine database, over 550 startups using AI as a core part of their products raised $5B in funding in 2016. Since 2012, deals and dollars to AI startups have been on the rise, and 2016 was a record year for startups globally.
Using the CB Insights database, we tracked funding to private AI companies globally over the past five years, and looked at how deal share breaks down by geography.
Our analysis includes companies applying AI algorithms to verticals like healthcare, security, advertising, and finance as well as those developing general-purpose AI tech. Our list excludes robotics (hardware-focused) and AR/VR startups, which we’ve analyzed separately here and here. Our analysis includes all equity funding rounds and convertible notes. This post was updated on 1/19/2017 to include deals through the end of 2016.
2016 deals set new record
Deals reached a 5-year high last year, from 160 deals in 2012 to 658 in 2016. Dollars invested also rose considerably in 2016, up about 60%.
The year included a number of mega-deals. The top round went to Israel-based ride-hailing app Gett, which uses AI algorithms to assist in on-demand car deployment and in the operation of autonomous cars. Volkswagen backed the company in a $300M corporate minority round, with the end goal of extending Gett’s predictive algorithms to on-demand autonomous cars.
In addition, auto tech company and unicorn Zoox raised $200M in Series A in Q2’16 and cybersecurity startup StackPath raised a $180M private equity round in Q3’16.
Apart from the previously mentioned Zoox, 2016 also saw the emergence of 2 new AI-focused unicorns: iCarbonX and Flatiron Health.
Q4’16 sees 4 mega-rounds
Q4’16 saw 173 deals across 25 countries. The deals tally made it the most active quarter for investments in 5 years.
Last quarter also saw 4 mega-rounds: $130M Series B round raised by life science startup Zymergen, $120M Series B round raised by computer vision startup SenseTime, $100M Series C round raised by facial recognition startup Face++, and a $100M round raised by Israel-based Voyager Labs.
Deals by geography
Nearly 62% of the deals in 2016 went to startups in the US, down about 17 percentage points from 79% in 2012.
Following the US, 6.5% of global deal share went to UK-based startups in 2016, followed by 4.3% to startups in Israel and 3.5% to startups in India.
Most active VC investors
Data Collective is the most active VC investor, having backed over 20 unique AI companies since 2012, including Freenome, Atomwise, and Descartes Labs. Khosla Ventures and Intel Capital ranked second and have backed more than 15 companies each since 2012.
| Rank | Investor |
|---|---|
| 1 | Data Collective |
| 2 | Intel Capital |
| 2 | Khosla Ventures |
| 4 | New Enterprise Associates |
| 4 | Google Ventures |
| 6 | Andreessen Horowitz |
| 7 | Accel Partners |
| 8 | SV Angel |
| 9 | Plug and Play Ventures |
| 9 | Slack Fund |
| 9 | Horizons Ventures |
| 9 | General Catalyst Partners |
| 9 | Norwest Venture Partners |
| 9 | Bessemer Venture Partners |
| 15 | First Round Capital |
| 15 | 500 Startups |
| 15 | Bloomberg Beta |
| 15 | FundersClub |
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