National Venture Capital Association releases 2026 Yearbook

(Washington, DC) National Venture Capital Association (NVCA) releases its 2026 Yearbook, which is available for download.

Key Findings:

• In 2025, U.S. VC firms closed 15,352 deals worth $320 billion, a 51 percent increase in deal value and the second-highest total on record. Artificial intelligence accounted for 65.4 percent of all deal value.
• A growing share of that capital reflects deepening confidence in the U.S. innovation ecosystem from nontraditional investors (NTIs) — including hedge funds, sovereign wealth funds, corporate strategics, and endowments — who participated in roughly 30 percent of deals and accounted for 83 percent of all investment value. NTI capital flows, estimated conservatively at $80–$100+ billion, now rival the size of the entire European VC market — a testament to the global conviction behind American innovation.
• Traditional VC fundraising totaled $67 billion across 585 funds, with the top ten funds alone capturing a combined $22 billion, 32.9 percent of all VC capital, up 2.5 times from the 13 percent they claimed in 2021. That left roughly $44.9 billion to be divided among the remaining 575 funds.
• At the same time, the industry continued to contract first-time fund formation collapsed to 101 funds, the lowest level since 2011 and down 77.9 percent from the 457 launched in 2021.
• While capital deployment remains strong, liquidity has not kept pace. Venture-backed exits totaled $217.1 billion across 1,463 deals in 2025—more than double the prior year—but still far below peak levels and insufficient to address a growing backlog of private companies.
• With 859 unicorns valued at $4.34T but only 30-40 unicorns actually exiting last year, the gap between investment and realization is widening, placing sustained pressure on the venture ecosystem.
• Limited partners continue to face reduced distributions, and secondary markets have emerged as an increasingly important outlet for liquidity, with volumes reaching over $100 billion rivaling IPO and M&A volumes as major financial institutions invest in market infrastructure.

"Venture capital is fundamentally a team sport," said NVCA President and CEO Bobby Franklin. "An investor may compete for—or collaborate on—a deal with corporate investors, crossover funds, sovereign wealth funds, or even the federal government. These players may be pursuing financial returns, job creation, critical intellectual property, or strategic advantage. Regardless of their motivations, they are playing to win—and their presence has shifted from the margins to the mainstream of the innovation ecosystem."

Franklin added: "Taken together, the 2025 data signals an industry at an inflection point—strong investment on one hand, constrained liquidity on the other, with a recovery in exits critical to restoring balance."

Why it matters:

• AI dominates investment. AI captured more than 65% of all 2025 venture investment, with non-traditional investors supplying a huge share of capital. Policymakers face new questions about supporting innovation while ensuring competition and oversight in a market increasingly shaped by outside players.
• Fundraising is top-heavy. A handful of mega-funds control the market, while emerging managers struggle to enter. This concentration highlights the need for policies that encourage variety in fund formation and protect the health of the early-stage venture ecosystem.
• Exits shift to secondaries. Secondary transactions returned nearly as much capital as exits in 2025. Regulators and lawmakers may need to consider how liquidity rules, tax incentives, and capital-markets infrastructure affect private company exits and the broader flow of venture capital.