Generative AI startups get 40% of all VC investment in cloud: Accel [Video]

Generative artificial intelligence startups are getting 40% of all the venture capital funding that flows into cloud companies, according to venture investors Accel.

In its latest annual Euroscape report, which looks at key cloud and AI trends, Accel said that venture funding for cloud startups based in the U.S., Europe and Israel is projected to rise to $79.2 billion this year, with artificial intelligence fueling much of the recovery.

Venture funding into the cloud industry climbed 27% annually — marking the first year of growth in three years. Cloud startups raised $62.5 billion in Europe, Israel and the U.S. in 2023, the report found.

Funding is up 65% from the $47.9 billion cloud firms raised four years ago, according to Accel.

It comes after OpenAI, the Microsoft-backed company behind the buzzy generative AI chatbot ChatGPT, earlier this month raised $6.6 billion in a mammoth funding round that valued the startup at $157 billion.