Growth

HSBC Funding the Future: Three quarters to AI

  • Growth
  • Article
  • 3 minutes read

Venture capital is having a strong year, but gains are concentrated among a small number of companies. Drawing on HSBC Global Investment Research’s proprietary Funding the Future survey and recent market trends, Shiva Joon explores the outlook for the final quarter of 2026.

  1. Investors are markedly more optimistic about dealmaking than about listings, and the deal data supports them.
  2. AI now takes more than three quarters of global venture capital dollars, commanding a widening valuation premium.
  3. Innovation is globalising faster than capital, so far.

Funding the Future

Venture capital is having a strong year, but it is a strong year for a small number of companies. Drawing on our proprietary Funding the Future survey and data on recent trends in the market from PitchBook1 , we look at what the final quarter of 2026 holds for the market.

AI and the rest

AI's share of global venture deal value has gone from 30% to 77% since 2023. The AI rounds are priced at a premium at every stage, and the premium widens as companies mature. The median AI company is valued at USD4.25bn against USD644m for its non-AI peer (Series D+). So far, subsequent rounds have validated the last one. However, risks persist; according to our survey, half of survey respondents (51%) still think an AI capex correction could be within a year.

77%
AI’s share of global venture capital deal value, up from 30% in 2023

Innovation is getting global, but capital is playing catch up

Growth is no longer concentrated in a handful of American cities. Indian, Asian and European hubs are now appearing higher in growth ecosystem rankings, and AI's share of deal count is climbing in every region we track. Capital has not followed at the same pace. Our survey reports wider geographic exposure with European exposure at 51% (up from 43%) and MENA at 10% (from 4%). But most investors still want their portfolio companies to list in the US.

Regional highlights

US: AI concentration sits on top of an exit market that was already narrow. AI and machine learning has overtaken software as a service as the largest US venture vertical by deal count. Listings above USD1bn made up 82% of US venture exit value this year, against 4% in 2022.

AsiaPac: The headline deal total has been flat while AI's share of it climbs. Greater China remains the largest market by deal count, with India, Japan, South Korea and Singapore behind it.

EMEA: Investment pace has climbed gradually to about 1.2 times as per HSBC Global Investment Research’s proprietary Venture Investment Tracker2 relative to the last couple years. AI and machine learning has taken the top spot by deal count here too. EMEA is also the one region where trade sales still dominate exits, at roughly two-thirds of exit value.

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Disclosure appendix

The following analyst(s), who is(are) primarily responsible for this document, certifies(y) that the opinion(s), views or forecasts expressed herein accurately reflect their personal view(s) and that no part of their compensation was, is or will be directly or indirectly related to the specific recommendation(s) or views contained in this research report: Shiva Joon, CFA, Thomas Devlin, Mark McDonald and Max Kettner, CFA

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