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Startup funding is recovering in headline terms in 2026, and investor sentiment has improved. But the recovery is narrow. Most of the money is going to AI companies, a small number of very large rounds drive the totals, and investors are asking whether AI spending turns into revenue. For a founder outside those categories, the aggregate figures may overstate how easily capital will reach them.
The figures below come from four sources with different scopes: an OECD analysis of global venture investment in AI, Carta’s data on companies that raise through its platform, and investor and founder surveys from HSBC and Morgan Stanley. Survey percentages describe expectations and stated plans, not completed deals.
Funding totals are up, but a few deals carry them
Carta recorded $30.4 billion in startup funding in Q1 2026 across companies on its platform. More than 60% of that went to AI companies, and the quarter’s down-round rate was 11.4%. These are measures from Carta’s platform, not a full-market total.
HSBC’s market data, dated July 17, 2026, put year-to-date global venture deal value at roughly $560 billion. HSBC describes the recovery in that figure as concentrated in a small number of outsized financings. Its clearest illustration: removing the five largest U.S. deals from the first quarter cuts U.S. deal value by more than 70%.
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1Clear out junk files and repair common Windows errors2Scan for outdated or missing drivers - takes under a minute3Repair Windows errors before they cause bigger problemsThat gap between the total and the typical deal is the central reading problem. None of the headline figures here counts how many companies were funded, so they cannot show whether the number of funded companies grew alongside the dollar total.
AI takes the largest share, mostly through mega-deals
The OECD’s analysis, published February 17, 2026, found that venture investment in AI firms made up 61% of all global VC investment in 2025: $258.7 billion of $427.1 billion. Deals over $100 million accounted for about 73% of AI investment value that year. AI infrastructure and hosting firms alone received $109.3 billion in 2025. The OECD cautions that investment markets are cyclical and that historical trends should be read carefully when projecting ahead, so this is a description of 2025, not a forecast for 2026.
Investors are judging AI spending on different terms now. In HSBC’s survey, 60% of respondents expected AI capital expenditure to rise over the following six months. Asked for the leading upside surprise, 33% of private investors and 43% of public investors chose enterprise return on investment. Monetization disappointment was the downside concern shared across both groups. For AI founders, the practical test is whether customers pay enough to justify the spend.
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Valuations depend on category
Carta’s Q1 2026 figures show how far category alone can move valuations. They apply to Carta’s dataset and to that quarter only.
| Measure | Carta figure | Scope |
|---|---|---|
| Median Series A valuation, AI foundational-model startups | $300 million | Q1 2026, Carta platform data |
| Median Series A valuation, non-AI startups | $55 million | Q1 2026, Carta platform data |
| Ratio of the two Series A medians | About 5.5 times | Calculated from the two medians above |
| Series B primary pre-money valuation, change vs. Q1 2025 | Up 17.2% | Carta platform data |
| Series C primary pre-money valuation, change vs. Q1 2025 | Up 12.5% | Carta platform data |
Carta also flags softness in early-stage SaaS valuations. A SaaS founder and an AI foundational-model founder are effectively operating in different valuation markets, and these medians do not show where any individual company would fall within its category.
What investors expect over the next year
HSBC’s ninth Funding the Future survey was run by Survation from June 19 to July 17, 2026, and included more than 200 global investors. Respondents represented $2.32 trillion in assets under management, including about $863 billion attributed to VC and PE investors.
| Horizon | VC/PE investors expecting activity to increase | VC/PE investors expecting no change |
|---|---|---|
| Next quarter | 44% | 47% |
| Next year | 64% | Not stated in HSBC’s summary |
These are expectations held in mid-2026, not a commitment to deploy capital. The survey does not show whether any increase would reach early-stage companies in particular.
Founders are looking beyond traditional VC
Morgan Stanley’s May 6, 2026 analysis of its founder survey reports that more than half of surveyed founders are pursuing a broader range of capital sources. The analysis describes three: strategic investment, debt, and structured equity. Its stage guidance is conditional. Debt may suit companies past Series B that have strong balance sheets, and structured equity may be considered by Series D and E businesses with more predictable cash flow. These are reported considerations, not financing advice for any one company.
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| Path | Stage and cash-flow fit | Dilution | Control | Main trade-off |
|---|---|---|---|---|
| Strategic investment | Not stated by stage in the survey analysis | New shares are issued, so existing holders’ stakes shrink | A corporate investor may seek commercial rights or influence over strategy | The partner’s priorities may not match yours, and the relationship can limit other customers or buyers |
| Debt | Companies beyond Series B with strong balance sheets; Carta notes hardware companies benefiting from non-dilutive debt | Generally none from a straight loan; warrants, if included, can dilute | Lenders commonly impose covenants that restrict spending or further borrowing | Repayment is owed on a fixed schedule even if revenue slows |
| Structured equity | Series D and E businesses with more predictable cash flow | New shares, often with preference terms that rank ahead of common stock | Preference terms can change how sale proceeds are divided | Common holders, including many employees, can receive less at exit than their ownership percentage suggests |
The dilution, control, and trade-off entries describe how each instrument works in general. The surveys do not report deal terms, so the actual impact depends on the specific agreement.
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Founders are under pressure to show results
In a Morgan Stanley press release on its 2026 founder survey, revenue growth ranked as surveyed founders’ top business priority, ahead of capital raising. 84% said they felt continual pressure to make the business succeed, and one-third said they had given up too much equity. On AI, 95% considered it critical to success, but only 23% felt very well supported in that area.
The sample was 150 private-company founders in the U.S. and Canada, each with 25 or more employees and at Series A or later. Roughly two-thirds (67%) were at Series C or later, so the findings describe established private companies rather than early-stage founders.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Liquidity: tender offers and IPO preparation
Tender offers are the nearer-term route
Morgan Stanley’s founder analysis reports that 62% of surveyed founders were considering or planning to go public. A separate Morgan Stanley at Work 2026 Liquidity Trends Survey, which used a different sample and different questions, found that 47% of private companies expected their next liquidity event to be a tender offer, and 54% said they had already completed one. Treat these as separate findings, not competing estimates of the same thing.
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One free scan finds every outdated or missing driver and matches the right update for your exact hardware.Free scan · exact hardware matchA tender offer lets shareholders sell part of their stake while the company remains private. Morgan Stanley describes it as an interim route to liquidity for employees, early investors, and founders. If you hold startup equity, your ability to participate depends on the company’s offer terms, which these surveys do not cover.
IPO plans depend on operating readiness
HSBC’s survey found that 46% of VC and PE investors expected IPO activity to increase over the next quarter, and 81% planned to exit portfolio companies within 12 months. These are stated intentions. They describe investor plans, not a pipeline of listings open to startups generally.
Morgan Stanley’s press release reports that founders cited consistent, predictable financial performance as the leading obstacle to pursuing liquidity. A favorable market helps only companies whose financial results are steady enough to support a listing or a tender.
Quick Recap
How to read the 2026 numbers
- Dollars versus companies. A rising total can reflect a few larger rounds even if the number of funded companies does not rise.
- AI versus everything else. The OECD’s global share and Carta’s platform split answer different questions, so do not treat them as one market.
- Intentions versus completed deals. A majority expecting higher activity describes sentiment, not the capital a given company will be offered.
- Platform data versus the whole market. Carta’s medians and percentage changes describe companies that raise through its platform in the period measured.
Practical implications
For founders
- Identify which category your company sits in, and build the financing plan around that category’s conditions rather than the aggregate totals.
- If you are an AI company, prepare evidence of paying customers, enterprise contracts, and margins, because that is where investor scrutiny is focused.
- Match each capital source to your stage and cash-flow predictability before accepting terms, and model dilution and preference payouts at exit, not only at the round.
- Make predictable financial performance a standing priority, since it is the obstacle founders most often cited on the path to liquidity.
For employees and other shareholders
- Ask whether the company plans a tender offer, who is eligible, and how the price is set.
- Check whether financing in the company’s capitalization includes preference terms, because those determine who is paid first in a sale.
- Treat a potential IPO as a possibility rather than a schedule until the company has announced one.
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