Startup and Venture Capital News for Thursday, February 5, 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 steady recovery after the downturn of recent years. Preliminary estimates suggest that 2025 was the third most successful year in history for startup investment volume (only behind the peaks of 2021 and 2022), indicating a resurgence of large private capital in the technology market. Investors worldwide are once again actively funding promising companies, record-scale deals are being made, and startup plans for public offerings are back on the agenda. Major venture funds are launching new mega-rounds and strategies, while governments and sovereign funds are increasing their support for innovation in a bid not to fall behind in the global technology race. As a result, the positive dynamics of the venture market instill cautious optimism for 2026, although investors remain selective in their evaluations and business models.
The Return of Mega Funds and Record Investments
Following a period of stagnation, “mega funds” — massive capital pools for technology investments — have returned to the market. American flagship Andreessen Horowitz (a16z) has raised over $15 billion in new funds, increasing its assets under management to a record $90 billion. These funds are directed to priority areas such as artificial intelligence, cryptocurrencies, defense technologies, and biotech. Meanwhile, Japan's SoftBank has reinforced 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 renewed activity of these players confirms the trend of capital concentration in 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 main driver of the venture boom. AI startups are attracting unprecedented investments, setting new records for the size of funding rounds. For instance, Elon Musk's project xAI secured around $20 billion in funding with the involvement of Nvidia — an extraordinary amount for a private company. OpenAI, the leader in the AI market, is not only attracting capital but also striking strategic deals: the company has 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 experiencing rapid growth: in the U.S., generative video startups (such as Higgsfield) and voice AI (like Deepgram) have achieved “unicorn” status just a few years after founding. In Europe, German startup Parloa raised $350 million at a valuation of $3 billion, affirming the global nature of the AI frenzy. The massive resources directed towards AI reflect the fierce competition among companies and nations for leadership in this area, creating new market imbalances as the 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, signaling the maturation of the fintech market. Several high-profile transactions were announced in January 2026. Capital One bank agreed to acquire Brex — a corporate expense management platform — for $5.15 billion. This acquisition marks the largest bank-fintech deal in history, underscoring traditional financial giants' desire to integrate advanced fintech solutions. European venture capital firm Hg acquired American financial platform OneStream for approximately $6.4 billion, buying shares from investors, including KKR. Other notable deals include Deutsche Börse's acquisition of Allfunds for €5.3 billion to strengthen its position in WealthTech, and US Bancorp's acquisition of brokerage firm BTIG for up to $1 billion. Alongside major acquisitions, several fintech startups are themselves entering the acquisition market: for instance, Australian unicorn Airwallex is expanding in Asia by acquiring Korean payment company Paynuri. The surge in M&A activity demonstrates that as the industry matures, successful fintechs either fall under the wings of larger players or grow through strategic acquisitions.
Revival of IPOs: Startups Return to the Stock Market
The initial public offering (IPO) market for technology companies is reviving after a prolonged pause. The year 2025 surprised analysts with the number of high-profile stock market launches: in the U.S. alone, at least 23 companies went public with valuations exceeding $1 billion (up from 9 the previous year), with the total capitalization of these IPOs surpassing $125 billion. Investors are once again ready to welcome profitable and fast-growing companies to public markets, especially those with a clear narrative around AI or other “hot” technologies. In 2026, this trend is expected to continue, as a number of “unicorns” are subtly hinting at preparations for IPOs. Among the most anticipated candidates for public offerings are:
- Major fintech “unicorns”: payment platforms Plaid and Revolut;
- Leaders in artificial intelligence: AI model developer OpenAI, large data platform Databricks, business AI startup Cohere;
- Other tech giants: for example, space company SpaceX, if market conditions are favorable.
The successful debuts of these companies could provide additional momentum to the market, although experts warn that market volatility could suddenly close the “IPO window.” Nevertheless, the revival of public offerings strengthens faith that investors are ready to reward startups with strong growth and profitability metrics.
Defense and Cyber Startups in the Spotlight
The geopolitical landscape and new risks are reshaping the priorities of venture investors. Amid tensions between nations and the quest for technological independence, significant capital is being directed into defense and cybersecurity startups. In the U.S., the “American Dynamism” initiative — investments in technologies that bolster national security — is gaining momentum. An example is the aforementioned mega round of a16z, part of which will go towards defense and deep tech startups. Startups developing solutions for military and government entities are attracting nine-figure sums: California-based Onebrief, which creates software for military planning, recently received around $200 million in funding at a valuation exceeding $2 billion, and acquired a related startup to enhance its platform's capabilities. In Europe, the rapidly growing cybersecurity startup Aikido Security from Belgium achieved “unicorn” status ($1 billion) within just two years of development by offering a comprehensive code and cloud protection platform. Such successes reflect increasing demand for technologies that ensure digital and national security — from supply chain protection (as demonstrated by UK-based Cyb3r Operations, which raised $5 million to monitor cyber risks) to new means of intelligence and satellite surveillance. The trend towards increased support for defense projects is also evident at the government level: governments and funds, especially in the U.S., Europe, and Israel, are eager to invest in startups capable of providing a strategic advantage.
Regional Highlights: The U.S. Leads, Europe and Asia Follow
Geographically, the venture boom is global in nature, although it is unevenly distributed. The U.S. remains the main engine, accounting for the lion's share of large funding rounds, particularly in the AI sector. Silicon Valley retains its status as the premier capital attraction center, although competition for talent and deals is increasing worldwide. In Europe, the landscape is being reshaped: continental economies are ramping up venture investments. Germany outpaced the UK in startup investment volumes by the end of 2025, highlighting the strengthening of European hubs. Regional EU funds and government programs (such as initiatives in France and the Nordic countries) are fostering the creation of local unicorns and the development of the artificial intelligence sector. In Asia, the dynamics are varied: the Indian ecosystem has reached a new level of maturity — January saw the emergence of the first “unicorns” of 2026 and the resumption of high-profile IPOs on local exchanges, reflecting the scale and maturity of the market. Conversely, the Chinese venture market remains relatively restrained due to regulatory pressure and the reorientation of capital towards domestic priorities; however, Chinese investors are actively investing in foreign AI and chip projects to stay competitive. The Middle East and North Africa are witnessing an acceleration: funds from the UAE, Saudi Arabia, and Qatar are increasing their financing of technology companies both regionally and globally, supporting fintech, cloud services, and AI startups. Startup activity is also rising in Latin America and Africa, although in absolute terms, these regions still lag behind the rest of the world. Thus, the venture rise 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 level of caution, recalling the lessons from the recent market “cooling.” Capital is once again flowing into the technology sector, but demands on startups have become stricter: funds expect clear business models, economic efficiency, and viable paths to profitability from teams. Company valuations are rising, particularly in the AI segment; however, investors increasingly focus on risk diversification and long-term portfolio sustainability. The return of liquidity — from billion-dollar funds to new IPOs — creates opportunities for massive 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 “breakthrough” areas (AI, biotechnology, climate technology, defense) will continue, but there will be greater attention to growth quality, corporate governance, and regulatory compliance. This approach should help the market avoid overheating and lay the foundation for the sustainable development of innovations in the long term.
