AI is eating the world in 2023 after long standing SaaS feast – Top verticals by VC investments
AI and ML investments have grown in 2023 despite the market trends, reached the top and overcame SaaS by funding from VCs.
AI is eating the world in 2023 after long standing SaaS feast – Top verticals by VC investments
- Top 10 verticals being stable in 2021-2023 with SaaS and Healthtech maintaining in the top 3.
- AI and ML investments have grown in 2023 despite the market trends, reached the top and overcame SaaS by funding from VCs.
Top 10 verticals by global VC investments in 2021-2022 and growth in 2022, $B.
In 2022, a decline followed a record-breaking year for VC investors as global market downturn intensified, with e-commerce being harmed the most from the top verticals.
Mobility Tech — with a focus on EV and autonomous cars — dropped from the list in 2022, while Crypto and Blockchain jumped into the top 10, being the only vertical with growth compared to 2021. However, most of the investments were concentrated in Q1 2022.
Top 10 verticals by global VC investments in LTM Nov’23 with growth to 2022, $B.
The downtrend of VC funding continued in 2023, reaching the pre-COVID levels, before the tech market surge from monetary impulses. Although the list of top verticals remained the same, with Healthtech being the most stable segment, a notable reshuffle has happened.
AI&ML-based companies took the lead after the explosion of consumer friendly LLM-based tools in 2022-2023 and absorbed the appetite of value-seeking investors, which resulted in a rare-to-be-seen growth within the most prominent VC investment trends.
Expansion relies on infrastructure rails provided by CloudTech and DevOps products, being one of the main beneficiaries of the AI hype, since the processing capacity of on-premises is not yet capable to digest the needs of humongous LLM models, and users mostly rely on cloud-based solutions.
Decades of SaaS businesses’ domination were overtaken by the next wave of tech revolution. Of course, these verticals are heavily intersected and AI and ML tools have proven their value for tons of use cases. However, if we talk about the core technology, this may be the beginning of a new era for VC funding composition.