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State of Enterprise Software 2025
Rob Helm, Andrew McCarty, Andrew Pardo
Key takeaways
Amid uncertain macroeconomic conditions and a challenging exit environment, artificial intelligence/machine learning (AI/ML) stands out as a primary force driving the venture ecosystem. The technology will continue to attract capital and investor interest, but mass adoption and AI’s long-term success will be dependent on trust, credibility, and its ability to increase efficiency across all layers of the software stack.
43%
YoY growth in US VC investment in enterprise software companies
Capital requirements and optimism surrounding AI drove much of this growth in 2024, with investors anticipating a new era of opportunity.
1 in 6
US VC enterprise software deals involved AI/ML startups
Up from 1 in 12 deals pre-pandemic, highlighting the rapid rise of AI technology.
307
US VC-backed unicorns are enterprise software
This number accounts for 40% of all US VC-backed unicorns last year, up from 31% five years ago.
The data
Our report on the trends shaping the enterprise software sector shows AI becoming a key priority as the technology is attracting a greater proportion of venture deals and capital.
FUNDRAISING
Venture funds prioritize AI
A record 40% of capital raised from US VC funds closed in 2024 came from funds that target the AI vertical.
As optimism surrounding AI continues to accelerate, more funds are making the technology a focal point of their fundraising efforts in an otherwise difficult environment.
Note: Based on funds that list artificial intelligence as a targeted vertical. Funds may have multiple targeted verticals. Source: Preqin and SVB analysis.
UNICORNS
Enterprise software startups reach unicorn status at a record pace
On a median basis, it took the 2024 class of venture-backed US enterprise software unicorns a little more than three years to reach that mark, a pace nearly twice as fast as recent classes.
Investor fear of missing out on AI opportunities plus the massive amounts of capital needed to scale have led to high valuations. Only time will tell if they are all justified.
Note: Sector and subsectors determined using SVB proprietary taxonomy. Source:Pitchbook Data, Inc., SVB proprietary data and SVB analysis.
EXITS
Seed-stage exits remain prevalent
US enterprise software startups are exiting at the seed stage nearly a quarter of the time, up 13 percentage points since 2019.
Abundant seed funding and higher benchmarks for the next round paved the way for the current bottleneck at Series A, leading more enterprise software startups to exit at the seed stage.
Note: Enterprise tagging based on SVB proprietary taxonomy. Pre-Seed includes accelerator/incubator and angel rounds. Early-stage includes Series A and Series B, as well as early-stage as defined by PitchBook Data, Inc. Late-stage includes Series C+ as well as late-stage as defined by Pitchbook Data, Inc. Source: PitchBook Data, Inc., SVB proprietary data and SVB analysis.
Read the full State of Enterprise Software report
Get the context behind the emerging trends in enterprise technologies.
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