Startup and Venture Investment News for Thursday, 5th February 2026: Key Deals, Growth in AI and Deep Tech Investments, Venture Fund Strategies, and Global Startup Market Trends.
As of early February 2026, the global venture capital market continues to show a robust recovery after the downturn of recent years. Preliminary estimates suggest that 2025 was the third most successful year in history for startup investments, surpassed only by the peak years of 2021 and 2022, indicating a return of significant private capital to the tech market. Investors worldwide are actively funding promising companies again, with record-breaking deals being closed and startup plans for public listings back on the agenda. Major venture funds are launching new mega rounds and strategies, while governments and sovereign funds are increasing support for innovation in an effort to keep pace in the global tech race. Consequently, the positive dynamics of the venture market instil cautious optimism for 2026, although investors remain selective regarding valuations and business models.
Return of Mega Funds and Record Investments
After a period of stagnation, "mega funds" — enormous capital pools for technology investments — have returned to the market. The American flagship Andreessen Horowitz (a16z) raised over $15 billion in new funds, increasing its assets under management to a record $90 billion. These funds are directed towards priority areas such as artificial intelligence, cryptocurrencies, defence technologies, and biotech. Simultaneously, Japan's SoftBank has bolstered its presence in the AI sector: at the end of 2025, SoftBank invested $22.5 billion in OpenAI, marking one of the largest single investments in startup history. The resurgence of activity from such players confirms the trend of capital concentration among industry leaders and investors’ desire to secure a stake in the next technological breakthrough.
AI Startup Boom: Unprecedented Funding Rounds
The artificial intelligence sector remains the primary driver of the venture capital boom. AI startups are attracting unprecedented levels of investment, setting new records for funding rounds. For instance, Elon Musk's project xAI raised approximately $20 billion with participation from Nvidia — an extraordinary sum for a private company. OpenAI, the market leader in AI, is not only attracting capital but is also entering into strategic deals: the company secured exclusive supplies of high-performance Cerebras chips worth over $10 billion to accelerate its models, enhancing its technological advantage. Alongside industry giants, new players are also rapidly emerging: in the US, generative video startups (such as Higgsfield) and voice AI startups (including Deepgram) achieved "unicorn" status just a few years after their founding. In Europe, Germany's Parloa raised $350 million at a valuation of $3 billion, underscoring the global nature of the AI frenzy. The enormous funds directed towards AI reflect the intense race among companies and nations for leadership in this field, creating new market imbalances where a lion's share of venture dollars flows into AI projects.
Major Exits in Fintech and a Wave of Mergers
The fintech sector is witnessing a wave of consolidation, signalling the maturity of the fintech market. Several high-profile deals were announced in January 2026. Capital One agreed to acquire Brex, an expense management platform, for $5.15 billion. This purchase represents the largest "bank-fintech" transaction in history, highlighting traditional financial giants' desire to integrate advanced fintech solutions. European venture fund Hg acquired the American financial platform OneStream for approximately $6.4 billion, buying out shares from investors, including KKR. Other announcements include Deutsche Börse purchasing the Allfunds platform for €5.3 billion to strengthen its position in WealthTech and US Bancorp acquiring the brokerage firm BTIG for up to $1 billion. Alongside large acquisitions, several fintech startups have also entered the market for acquisitions: for instance, the Australian unicorn Airwallex is expanding into Asia by acquiring Korean payment company Paynuri. The uptick in M&A transactions demonstrates that as the industry matures, successful fintechs either fall under the umbrella of larger players or grow themselves through strategic acquisitions.
Revival of IPOs: Startups Return to the Stock Market
The initial public offerings (IPO) market for technology companies is reviving after a prolonged hiatus. 2025 surprised analysts with the number of notable public listings: in the US alone, no fewer than 23 companies went public with a valuation exceeding $1 billion (up from 9 the previous year), and the total capitalisation of these offerings surpassed $125 billion. Investors are once again ready to welcome profitable and rapidly growing companies to public markets, especially if the business has a clear narrative around AI or other "hot" technologies. In 2026, this trend is expected to continue, with several "unicorns" openly hinting at plans for IPOs. The most anticipated candidates for public listing include:
- Major fintech 'unicorns': payment platforms Plaid and Revolut;
- Leaders in artificial intelligence: AI model developer OpenAI, big data platform Databricks, business-focused AI startup Cohere;
- Other tech giants: for example, space company SpaceX if market conditions are favourable.
Successful debuts by these companies could provide additional momentum to the market, although experts caution that market volatility may suddenly close the "IPO window." Nonetheless, the revival of public offerings strengthens the belief that investors are ready to reward startups with strong growth and profitability metrics.
Defence and Cybersecurity Startups in the Spotlight
The geopolitical landscape and new risks are reshaping venture investors' priorities. In the wake of tensions among nations and the desire for technological independence, considerable capital is being directed towards defence and cybersecurity startups. In the US, the “American Dynamism” initiative is gaining traction — investments in technologies that strengthen national security. An example is the aforementioned mega round from a16z, part of which will go towards defence and deep tech startups. Startups developing solutions for the military and government structures are attracting nine-figure sums: California’s Onebrief, which creates software for military planning, recently secured around $200 million in investments at a valuation exceeding $2 billion, and acquired a relevant startup to enhance its platform's capabilities. In Europe, the rapidly growing cybersecurity startup Aikido Security from Belgium achieved "unicorn" status ($1 billion) just two years after its inception, offering a comprehensive platform for code and cloud protection. Such successes reflect the increasing demand for technologies that ensure digital and national security — from securing supply chains (with the British Cyb3r Operations raising $5 million for monitoring cyber risks) to new means of reconnaissance and satellite observation. The trend of heightened support for defence projects is also evident at the governmental level: countries and funds, particularly in the US, Europe, and Israel, are eager to invest in startups that can provide a strategic advantage.
Regional Highlights: The US Leads while Europe and Asia Catch Up
Geographically, the venture boom has a global character, although it is distributed unevenly. The United States remains the primary locomotive — American projects account for a lion's share of large rounds, especially in the AI sector. Silicon Valley retains its status as the leading capital magnet, although competition for talent and deals is growing worldwide. In Europe, the landscape is undergoing restructuring: continental economies are increasing venture investments. Germany surpassed the UK in startup investment volumes by the end of 2025, indicating the strengthening of European hubs. Regional EU funds and government programmes (for instance, initiatives from France and Scandinavian countries) are stimulating the creation of local unicorns and the development of the AI sector. In Asia, the dynamics are heterogeneous: the Indian ecosystem has reached a new level of maturity — the first "unicorns" of 2026 emerged in January, and high-profile IPOs resumed on local exchanges, reflecting the scale and maturity of the market. In contrast, the Chinese venture market remains relatively subdued due to regulatory pressures and a reorientation of capital towards domestic priorities; nevertheless, Chinese investors are actively investing in foreign AI and chip projects to stay in the game. The Middle East and North Africa are showing acceleration: funds from the UAE, Saudi Arabia, and Qatar are increasing funding for technology companies both in their region and globally, supporting fintech, cloud services, and AI startups. Startup activity is also growing in Latin America and Africa, although in absolute terms, these regions still lag behind the rest of the world. Thus, the venture upturn indeed spans all continents, forming a more balanced global innovation ecosystem.
Looking Ahead: Cautious Optimism and New Benchmarks
Despite the current upswing, investors maintain a sense of caution, remembering the lessons of the recent market "chill." Capital is flowing back into the tech sector, but demands placed upon startups have become stricter: funds expect clear business models, economic efficiency, and understandable paths to profitability from teams. Valuations for companies are rising, particularly in the AI segment; however, investors are increasingly focusing on risk diversification and the long-term sustainability of their portfolios. The returning liquidity — from billion-dollar funds to new IPOs — creates opportunities for substantial growth but also intensifies competition for outstanding projects. It is likely that in 2026, the venture capital industry will enter a phase of more balanced development: funding for "disruptive" areas (AI, biotechnology, climate tech, defence) will continue, but there will be an increased emphasis on growth quality, corporate governance, and regulatory compliance. This approach should help the market avoid overheating and lay the foundation for sustainable development of innovations in the long term.
