Global venture capital transactions fell in the first quarter of 2025, according to a report by the National Venture Capital Association (NVCA) and PitchBook.
In North America, there were 3,155 transactions in the first quarter of 2025, compared with 2024 in the first quarter. In Europe, there were 1,852 transactions in the first quarter of 2025 compared with 2,917 transactions in the same period last year; in Asia, the number of transactions was 2,063 in the first quarter of 2025 compared with 3,111 in the same period last year; in Latin America, the number of transactions was 156, compared with 225 in the same period last year. In the rest of the world, there were 325 transactions in the first quarter of 2025, compared with 561 transactions in the same period last year.
In the first quarter of 2025, M&A exits by VC-backed companies also declined, with transactions worth $78.2 billion in 636 transactions, compared with an average of $80 billion in quarterly average of $726 per quarter for all quarters in 2024.
Asian results
Asia Pacific private capital analyst Melanie TNG said in the report that APAC’s VC trading activity was still tired in the first quarter of 2025, continuing a cautious trend amid macroeconomic uncertainty for years.
“The number of deals has dropped, but the total capital investment is huge, driven by a larger round-driven round in the B2B space. Used cars raised $2 billion, the largest deal in Asia,” TNG said.
TNG said in Asia, VC-backed exit activity continued to lag behind, falling to just 95 exit activity in Q1 2025, the lowest since Q2 2019. Historically, the region’s markets have been struggling with ongoing export channels, especially as many people are relatively still in developing a strong financial ecosystem. The export drought has also affected the fundraising campaign, which remains silent as LP liquidity signs are showing.
TNG said information technology has been the number of transactions, which is the basis of the ongoing momentum in AI and digital infrastructure. The government-led strategic moves also support this trend, especially as local political tensions continue to stimulate the development of technological sovereignty in Asia.
South Korea, for example, launched a KRW 34 trillion fund in February to return to cutting-edge industries such as semiconductors, batteries and biotechnology. In March, China also announced a state-guided venture capital fund to support advanced manufacturing and strategic technologies.
US results
Kyle Stanford, head of U.S. risk research at PitchBook, said the U.S. market has become very forked among a handful of companies that can raise countless funds, while the rest of other markets continue to struggle with capital shortages.
About 71% of transaction value in the United States is spent on AI investments. The payment is closely related to Openai’s $40 billion round. Although not including the deal, AI still captured 48.5% of the total investment in the quarter’s closing transactions.
“Export activity shows that Qureweave’s high-profile IPO announced a $32 billion WIZ acquisition (not yet completed) along with several other well-known brand IPO documents, which show signs of excitement in the first quarter,” Stanford said. “But the liquidity market remains softened except for a few transactions. Only 12 companies have completed public listings and liquidity concerns abound.”
The lack of distribution continues to put pressure on the fundraising market. The first quarter closed only $10 billion in new commitments, which put the lowest fundraising environment in the year since 2016.
European results
Navina Rajan, senior private capital analyst at UEFA/MEE/North Africa, said the value of European risk transactions in the first quarter of last year was at a pace below Q1, as the first quarter of 2025 showed signs of a more cautious environment and a broader sense of macroeconomics.
Through verticality, as life sciences and fintech also show resilience, AI moves into the highest ranking vertical through transaction value. As we grow throughout the year, activities and rankings are likely to continue to evolve.
Exit value also makes the year softer. Despite recent market volatility, we still expect IPO activity to take place in Europe, as the valuation and volatility of the IPO window still have good thresholds.
“The European-based venture capital fund raises a soft start to the year sitting in smaller brackets. The largest shutdown vehicles have been outside the UK so far. Emerging managers have also received a portion of the fund’s number with some first-time funding,” Rajan said.
Results in Latin America
Stanford said venture capital in Latin America hit $1.4 billion in the first quarter, the strongest transaction value quarter since 2022. The value of several big deals, including a $376 million investment in digital banking app Ualá. The deal calculates about a quarter of 20% of the trade, the lowest since 2020.
In the first quarter, only two VC funds were shut down in the new commitments in Latin America. Since the beginning of 2024, only 22 funds have been closed, with a total commitment of less than $600 million. This will have an impact on recent transactions without increasing foreign investment. Lack of exports continues to weigh in Latin American venture capital markets.
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