AI startups are cashing in big as venture capital bets on the future.
While the buzz around AI might be wearing thin for some, the venture capital (VC) community is just beginning to grasp its enormous potential. In the second quarter of 2024, AI startups received a record-breaking 28% of global venture capital funding, amounting to an impressive US$18.3 billion out of the total US$65.7 billion in global VC funding. This represents a significant leap, with AI funding contributing to an 8% increase in quarterly funding compared to Q1 2024.
A large portion of this funding was directed toward foundational AI models and infrastructure companies, including well-known names like OpenAI, Anthropic, Scale AI and CoreWeave. Some startups even managed to secure mega-rounds exceeding US$100 million, with a few hitting the US$1 billion mark. Notably, U.S.-based startups accounted for 64% of these mega-rounds. Building on our previous article about four AI startups that raised over US$100 million in 2024, we’re diving into five more U.S.-based companies that have recently crossed this milestone.
Bright Machines
Founded in 2018 and headquartered in San Francisco, Bright Machines is revolutionizing manufacturing with intelligent robotics and software-defined solutions. The company recently raised US$126 million in Series C funding in June, consisting of US$106 million in equity-led investments and US$20 million in venture debt. This brings its total funding to over US$400 million, with notable backers such as BlackRock, NVIDIA, Microsoft, Eclipse Ventures and J.P. Morgan.
Bright Machines focuses on automating electronics manufacturing using AI-driven robotics and machine learning to tackle inefficiencies. Their solutions provide centralized data visibility and flexible automation, streamlining production while reducing costs. One of their flagship innovations is the concept of “micro-factories”, which combine robotic cells to automate tasks like electronics assembly and inspection. With this fresh injection of capital, the company aims to further develop its platform, enabling engineers to design products remotely, manufactured by robotic systems.
Skild AI
Skild AI, an innovative robotics startup based in Pittsburgh, was founded in 2023 by former Carnegie Mellon professors Deepak Pathak and Abhinav Gupta. This young company has a bold mission: to develop artificial general intelligence (AGI) rooted in the physical world, challenging the conventional belief that AGI can only emerge from digital data. In July, Skild AI raised an astonishing US$300 million in Series A funding, achieving a valuation of US$1.5 billion. Investors in this round included Lightspeed Venture Partners, Coatue, SoftBank Group and Bezos Expeditions.
The startup is building a scalable foundation model for robots designed to exhibit general-purpose intelligence—the ability to adapt to various activities and environments. Skild AI’s robotics services cover tasks like visual inspection, data collection and patrolling in factories and construction sites. Its long-term vision extends beyond automation, aiming to enhance productivity and human potential across diverse sectors.
Hebbia
Hebbia, founded in 2020 by George Sivulka during his PhD studies at Stanford University, is making waves in generative AI for document search. Headquartered in New York, the company recently secured US$130 million in a Series B funding round led by Andreessen Horowitz. Other investors included Index Ventures, Google Ventures and Peter Thiel, bringing Hebbia’s valuation to over US$700 million.
Hebbia specializes in developing AI-powered tools that enhance information retrieval and streamline workflows across industries. Their solutions have gained traction among asset managers, law firms, banks and Fortune 100 companies. With this latest funding, Hebbia plans to refine its AI-powered document analysis capabilities further, making it easier for users to extract meaningful insights from vast amounts of information.
Etched AI
San Francisco-based Etched AI, founded by Gavin Uberti, is taking on the giants in the AI chip market. The company raised US$120 million in a Series A round led by Primary Venture Partners and Positive Sum, with additional support from Two Sigma Ventures, Peter Thiel and Kyle Vogt. With a team of just 35 employees, Etched AI is working hard to revolutionize the industry with its Application-Specific Integrated Circuit (ASIC) chips.
These specialized AI chips are designed to run transformer models more efficiently, positioning Etched AI as a challenger to industry leaders like NVIDIA. The company’s flagship product, the Etched Sohu chip, boasts over ten times the speed of traditional GPUs, thanks to greater raw computing power and a streamlined design. Etched AI plans to use its new funding to manage design and production costs, partnering with Taiwan Semiconductor Manufacturing Co. (TSMC) for fabrication.
EvolutionaryScale
EvolutionaryScale, founded in 2023 and based in New York, is a unique player in the AI space, focusing on biological models for therapeutic design and environmental applications. Founded by former Meta AI researchers, the company has raised US$142 million in seed funding, with investments from Nat Friedman, Daniel Gross, Lux Capital, Amazon and NVIDIA.
The startup is leveraging AI to accelerate breakthroughs in drug discovery and protein engineering. One of its standout achievements is a generative AI model called ESM3, trained on 2.78 billion proteins. This model can analyze protein sequences, structures and functions, paving the way for innovations like creating novel fluorescent proteins—a process that nature would take millions of years to accomplish. EvolutionaryScale’s ambitious plans include improving its models further and collaborating with biotech companies to tackle some of the most pressing challenges in healthcare and the environment.
Conclusion
The impressive capital inflow into U.S.-based AI startups in 2024 demonstrates the industry’s resilience and innovative spirit, even as debates around AI’s potential continue. With US$35.5 billion invested globally in the first half of the year, companies like Bright Machines, Skild AI, Hebbia, Etched AI and EvolutionaryScale are driving the sector forward with groundbreaking solutions. This trend highlights that while AI fatigue may exist, the venture capital community remains optimistic about its transformative possibilities.
Also read:
- 4 AI Startups That Raised Over US$100M in Late 2024
- Can Open Source AI End OpenAI’s Dominance?
- 4 Startups Offering Sustainable and Creative Alternatives to Plastic
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