US Startup Funding Drops in March as AI Megarounds Fade
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- U.S. startups raised approximately $13 billion in seed-through-growth-stage funding so far in March, per Crunchbase data, putting the month on track to deliver just a fraction of January and February's tallies.
- The slowdown is almost entirely due to fewer giant AI megarounds closing in March, with February's record driven largely by a single round—OpenAI's $110 billion fundraise at an $840 billion valuation, announced on the second-to-last day of the month.
- Anthropic secured $30 billion in financing at a $380 billion valuation a couple weeks before OpenAI's round, and robotaxi pioneer Waymo picked up $16 billion in fresh late-stage funding in early February.
- Early- and seed-stage dealmaking in March is on track to come in close to the prior two months' levels, indicating the deceleration is concentrated at the late stage rather than across the board.
- The March funding decline coincides with the Iran War, which commenced on February 28; broad stock indexes fell in subsequent weeks, though Monday brought a partial rebound.
- European startup funding hit its highest point of the year in March, boosted by megarounds for AI infrastructure unicorn Nscale and Advanced Machine Intelligence, suggesting the U.S. slowdown is a domestic phenomenon.
- February's U.S. funding tally will likely remain one for the record books, since a $110 billion round has no close precedent in startup history and would be hard to top in any near-term window.
Why it matters: For late-stage investors and founders, the benchmark for 'normal' startup funding has been reset by a February driven almost entirely by OpenAI's $110B and Anthropic's $30B rounds. Early-stage activity is holding steady and Europe is hitting yearly highs—suggesting the March dip is a megaround drought, not a broad retreat.
