North America Dominates AI VC Investments Despite Political Headwinds
Despite a political and regulatory landscape that some experts have called increasingly challenging, North America continues to attract the lion’s share of venture capital investments in Artificial Intelligence (AI) and machine learning startups. New data from PitchBook reveals that North America-based AI ventures are still the primary destination for VC dollars, far surpassing Europe and Asia.
Between February and May of this year, North American AI and machine learning startups secured a staggering $69.7 billion across 1,528 deals. In stark contrast, European AI ventures attracted $6.4 billion across 742 deals during the same period. Asia-based startups lagged further behind, with only $3 billion invested across 515 deals, according to PitchBook’s analysis.
The continued dominance of North America in AI venture funding is notable, particularly given the perceived headwinds created by the Trump administration’s policies. These include cuts to scientific grants related to basic AI research, increased difficulties for foreign students specializing in AI to study in the U.S., and threats to dismantle university-based AI labs by freezing federal funds. The administration’s trade policies, including retaliatory tariffs, have also contributed to market uncertainty, which is generally unfavorable for nascent AI ventures.
AI pioneer Geoffrey Hinton expressed concerns about the impact of certain individuals on scientific institutions. In a post on X in March, Hinton called for Elon Musk to be expelled from the British Royal Society, citing “the huge damage he is doing to scientific institutions in the U.S.” This statement reflects broader anxieties within the scientific community about the direction of AI research and development under the current political climate.
One might expect that Europe, with its stated ambitions to become a global leader in AI and substantial investments in the field, would be attracting more venture capital. The EU has committed hundreds of billions of euros to support AI development within its member countries and boasts several successful and well-funded AI startups, such as Mistral, H, and Aleph Alpha. However, there is little evidence of a significant shift in global investment towards Europe, at least not yet.
Similarly, China, home to promising AI startups like DeepSeek and Butterfly Effect (the company behind the agentic platform Manus), has not seen a corresponding surge in VC activity. Export controls impacting the ability of certain Asian countries to procure AI chips are likely a contributing factor.
In 2024, North American startups accounted for 75.6% of all VC AI funding, totaling $106.24 billion. This share has only increased in 2025, with North American AI investments representing 86.2% ($79.74 billion) of all VC funding for AI globally so far.
Despite the political and regulatory challenges, the U.S. remains the undisputed center for AI capital. This indicates that investors, despite potential concerns about the administration’s unpredictability, still believe that U.S. innovation will yield the greatest returns in the AI sector, at least for the time being.
