Generative AI and Cleantech Show Growth Despite Overall VC Downturn

Jun 10, 2024 9 mins read

A new report released today by Startup Genome and the Global Entrepreneurship Network on the current state of startups in 2024 has found a mix bag of results, with significant challenges in global venture capital funding but positive signs in areas including generative artificial intelligence and cleantech.



The 2024 Global Startup Ecosystem Report, primarily based on data accrued from four.5 million agencies across more than 300 entrepreneurial innovation ecosystems, contains insights from impartial research and coverage work to provide an analysis of world startup tendencies, investment dynamics, and atmosphere overall performance.

The pinnacle result, and one that isn’t sudden, is that there has been a wonderful decline in worldwide VC funding in 2023. Series A funding plunged forty six% ultimate year, but there had been signs of a recuperation in the first area of this year.

The variety of exits in 2023 fell forty seven% in comparison to 2022 and 86% in comparison to 2021. The number of latest unicorns, organizations with an on-paper valuation of over $1 billion, fell by means of fifty eight% from 2022 and 87% from a top in 2021.

Generative AI and cleantech bucked the fashion. Generative AI accounted for 20% of all VC investment in 2023, triple the amount in 2022, and cleantech startups raised 2.Five times more funding inside the second half of closing yr as compared to the first 1/2 of 2020. Notably, European cleantech startups outperformed the U.S. And China in Series A funding boom over the past two years.

Silicon Valley remained at the pinnacle of the worldwide environment scores for startups, accompanied by using New York City and London. Tokyo entered the top 10 for the first time and Seoul moved up 3 spots to 9th location. In the rising-ecosystems rankings, Madrid and Barcelona ranked in first and second region, with other areas growing within the ratings, consisting of Jakarta, Metro Rhein-Ruhr, and the Great Lausanne Region.

Despite the mixed effects, the report does point to positives ahead, noting that even with the challenges of reduced funding and international economic instability, early-stage startups are showing resilience. Entrepreneurs retain to innovate, specially in AI and cleantech, positioning these sectors for increase.

“Thankfully, in conjunction with our economies, international startup ecosystems are on the point of a brand new boom cycle,” the report notes. “A slight but widespread uptick in investments within the first region of 2024 suggests that we can also have reached the bottom of the recent funding downturn.”

The file introduced that “History tells us that people who invest at some stage in or right away after a downturn gain the highest advantage. Now is the time to begin constructing, capitalizing at the specific possibilities that stand up in instances of transition.”

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