European startups got just $1bn of the €22bn that VCs have invested in generative AI since 2019, according to data from Dealroom.
Unsurprisingly, American companies attracted the bulk of the money. A whopping $20bn — 89% of the global total — went to US startups. Their Asian counterparts raised only $790mn, while the rest of the world combined bagged just $454mn. Dealroom’s data collection ended on July 10, 2023.
US startups have raised 89% of globally GenAI investment 😳
In the last decade, venture capital has gone global. More than half of VC investment is now raised outside the US. Not so in Generative AI.
— Dealroom.co (@dealroomco) September 11, 2023
The US dominance is partly explained by the rise of OpenAI. The company has been a VC darling since the launch of ChatGPT, which sparked the generative AI boom. Venture capitalists ploughed nearly $12bn into the San Francisco-based company.
OpenAI is also the leading name in Dealroom’s model maker segment, which accounts for over 60% of the total VC funding for GenAI. Other big players in the field include Anthropic, Adept AI, Inflection AI, and Aleph Alpha. The next most funded segments are applications and infrastructure.
The Bay Area, where OpenAI is based, has become the epicentre of generative AI. VCs funnelled over $18bn into startups in the region. The next leading cities in the sector were New York ($676mn) and Tel Aviv ($433mn).
Outside of the top three, the landscape is a lot brighter for Europe.
London took fourth place in the rankings. GenAI startups in the UK capital raised around $36mn, led by the $101mn investment in Stability AI, which makes the Stable Diffusion text-to-image model. Three European cities rounded out the top 10: Berlin ($141mn), Amsterdam ($238mn), and Stockholm ($100mn).