Growth of VC Investment Moves NYC Firmly into 2nd Place Among Peer U.S. Regions

Following a record high of venture capital (VC) investment nationwide in 2021, activity returned to more typical levels in 2022 and 2023 according to the October report by the New York State Comptroller’s (OSC) office. In late 2024, activity spiked again and in the 1st quarter of 2025 VC investment reached $92.9 billion in deal activity — the second-highest level on record. In addition, the average size of VC funding deals has significantly grown in recent years with deals over $50 million increasing “from 56.9% of the total dollar value in 2019 to 68.7% in 2024. Artificial Intelligence (AI) has been strongly fueling investment growth, accounting for 71% in the 1st quarter of 2025 compared to 16% in 2021. The New York City metropolitan area saw an increase of 38.4% in the number of transactions — the third largest nationally, with transaction volume reaching nearly 2,200 deals; and the pace of growth was faster than the 24.4% increase in the San Jose metropolitan area. Similar to the U.S., VC investment in the software and tech service sector surged in New York City during the past few years, accounting for 52.4% of all investment in 2024 — an increase from 37.6% in 2019. The strong pace of overall VC activity during the start of 2025 slowed in the 2nd quarter, in part due to “federal economic policy that remain uncertain,” but remains stronger that before the pandemic. There has also been the “recent trend of mega-deals diverting funds from smaller companies,” which may require monitoring by public officials along with continued discussions on “ways to make New York City’s companies more attractive to investors and support entrepreneurs who lack access to capital.”

Source:    https://www.osc.ny.gov/files/reports/osdc/pdf/report-13-2026.pdf