The New York City metropolitan area ranked as the second largest market for venture capital (VC) funding in the United States in 2024, according to a report released by State Comptroller Thomas P. DiNapoli. The region attracted $28.5 billion in investments, representing 13.3% of the national total, more than doubling the amount invested since 2015.
“As the financial capital of the country, New York City is a natural hub for venture capital investing and the latest numbers bear that out,” DiNapoli said. “State and local officials should look at ways to make New York City’s business environment even more attractive to investors and support entrepreneurs that lack access to capital, especially as larger deals divert funds from startups hoping to establish themselves and spur growth in the area’s economy.”
After a return to more typical investment levels in 2022 and 2023 following a record high in 2021, VC activity increased again at the end of 2024. In the first quarter of 2025, national deal activity reached $92.9 billion, marking it as the second-highest level on record. The proportion of deals valued over $50 million grew from 56.9% in 2019 to 68.7% in 2024.
Investment in artificial intelligence (AI) has been a key driver both nationally and locally, with AI’s share of total investment rising from 16% in 2021 to 45% in 2024 nationwide. Of the five leading VC firms investing heavily in AI, four are based in California and one is located in Norwalk, Connecticut, which is part of the New York City metropolitan area.
While Silicon Valley continues to lead all regions by investment size and number of deals due to its established software industry presence, New York City holds second place among major U.S. markets for overall VC activity.
In 2024, New York City saw more transactions than Boston and Los Angeles combined and attracted more investment value than Boston, Los Angeles, and Philadelphia together.
Nationally, funding for software companies increased from $28.6 billion in 2015 (32.6% of all funding) to $100 billion by 2024—almost half of all investments that year. The first half of 2025 saw this share rise further to nearly 58%, with over $94 billion directed into software firms.
Within New York City itself, software and tech services accounted for over half—52.4%—of VC activity last year compared with just under 38% five years prior. From 2020 through 2024, this sector received more than $44 billion locally and supported at least 13,000 jobs.
Investors have shown growing preference for larger deals: while smaller deals ($25 million or less) made up nearly three-quarters of all deals in 2019, their share fell below two-thirds by last year as larger transactions became more common.
The value of mega-deals exceeding $100 million more than doubled during the first half of this year compared with last year, reaching a record $113.6 billion nationwide; average deal size also doubled during this period.
DiNapoli’s report also noted that female-founded companies raised $955 million across 143 deals within New York City during the twelve months ending June 2025—a performance ahead of their San Francisco counterparts for that period. However, industry trends toward larger deals have reduced interest among investors for newer startups and early-stage investments where women- and minority-owned businesses are often concentrated.
Recent federal tax legislation expanded benefits such as qualified small business stock exemptions and allowed immediate deduction of R&D costs instead of amortizing them over several years. However, higher taxes on university endowments may limit their future capacity to finance VC investments; changes also include cuts affecting healthcare startups and removal of certain clean-energy credits.
New York State has worked to encourage VC growth through initiatives like Empire AI—a public-private consortium funded at $400 million—as well as ongoing commitments from its Common Retirement Fund led by Comptroller DiNapoli via an In-State Private Equity Investment Program supporting technology-based businesses statewide. Approximately $1 billion has been invested through this program into over 450 companies located within New York City alone.
While AI dominates much recent investment activity, financial services also remain significant recipients locally alongside media firms and pharmaceutical or consumer-focused headquarters—all contributing opportunities for emerging businesses within New York’s economy.
