TechCrunch Startup News AI startups are eating the venture industry and the returns, so far, are good; plus, Delve accused of misleading customers
Mar 23, 2026
Venture funding surged toward AI, with nearly half of Carta’s deal value going to AI startups. A few mega-rounds funneled vast capital into select companies. Discussion covers how AI spending and quick up-rounds are shaping fund returns and early IRR figures. A compliance startup faces anonymous accusations about misleading customers on privacy and security.
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AI Funding Concentration Drives K Shaped Venture Market
- AI startups captured 41% of Carta-tracked venture dollars in 2024, concentrating funding into a few massive rounds for companies like OpenAI, Anthropic, and XAI.
- That concentration created a K-shaped market where fewer bets get far more capital, boosting IRR for recent funds that back AI-native portfolios.
High IRR May Be Paper Gains From Rapid Revaluations
- Newer funds show higher IRR partly because early seed investments revalue quickly when startups raise follow-on rounds, inflating short-term performance.
- Carta warns this paper gain may not equal realized exits; time will reveal if IPOs or acquisitions validate those IRRs.
Big Rounds Reflect AI Model Cost Not Headcount
- AI rounds are larger not because teams are huge but because operating AI models is capital intensive.
- Investors are funneling big checks into compute-heavy companies, explaining oversized rounds for relatively small headcounts.