New Delhi: India is poised for an AI-led surge in venture capital (VC) investments, as global funding more than doubled to a record $330.9 billion in the first quarter of 2026, driven by a wave of artificial intelligence (AI)-led megadeals, according to a report released on Monday.
In its latest report, KPMG said that global VC funding rose sharply from $128.6 billion in Q4 2025 to $330.9 billion in Q1 2026, even as the number of deals declined to 8,464 from 10,097, indicating a shift towards fewer but larger transactions.
“AI-first businesses are expected to see strong demand going forward and are likely to drive the next phase of VC investment growth in India,” said Nitish Poddar, Partner and National Leader, Private Equity at KPMG in India.
Commenting on India, the report noted that artificial intelligence (AI) is emerging as a key investment theme, although the country is still at a nascent stage in terms of AI adoption and service delivery.
Moreover, the Americas accounted for over 80 per cent of the total, it said.
Globally, VC funding surged from $128.6 billion in Q4 2025 to $330.9 billion in Q1 2026, even as deal volumes declined to 8,464 from 10,097, indicating a shift towards fewer but larger transactions.
The report highlighted that ten megadeals worth over $2 billion each contributed more than $206 billion to the total investment value, with a majority of these deals focused on AI companies, particularly in the US.
The Americas dominated global VC activity during the quarter, accounting for over 80 per cent of the total investment, with funding rising to $270.1 billion. The US alone contributed $267.2 billion, more than double its previous record high.
In comparison, Europe recorded VC investments of $25.7 billion — a 14-quarter high — while Asia saw funding increase to $31.8 billion, a 12-quarter high.
Sector-wise, software remained the top destination for VC funding, attracting a record $225.2 billion in Q1 2026, nearly matching the sector’s total investment for the entire previous year.
Meanwhile, global exit value also more than doubled to $413.5 billion during the quarter, largely driven by large mergers and acquisitions (M&A), while IPO activity remained relatively subdued.
The report added that despite strong momentum, geopolitical tensions, rising oil prices, and inflationary pressures could weigh on VC activity in the coming quarters.
(IANS)
