Summary:
U.S. billion-dollar startup exits are rebounding in 2025, with IPO and M&A values up significantly year over year.
AI innovation is a key driver, attracting investor interest and boosting confidence in the market.
Notable IPOs like Figma and Circle saw first-day pops over 100%, indicating strong public market appetite.
M&A activity has surged, with Alphabet's $32 billion acquisition of Wiz leading the way.
Venture investors are finding relief as exit opportunities increase after a quiet period, with public markets offering cheaper capital.
The U.S. venture capital market is experiencing a significant rebound in exits for billion-dollar startups in 2025, following a period of relative quiet. According to Crunchbase data, both IPOs and M&A activities are on the rise, with overall exit values showing a substantial increase compared to previous years.
While IPO levels have not yet returned to normalized rates, there is growing market confidence, particularly for companies with strong growth narratives and those focused on AI innovation. M&A values have exceeded previous peaks, fueled by several large acquisitions, providing much-needed relief for venture investors who have faced pressure during the recent dearth of exits.
By mid-August 2025, U.S. billion-dollar startup exits were up year over year, though still below the highs of 2020 and 2021. Analysis from The Crunchbase Billion-Dollar Exits Board indicates that debut values are the highest since 2022, and counts are up from 2023.
Markets Coming Back
Ran Ben-Tzur, co-head of capital markets at Fenwick, noted that while IPOs are not at normalized levels, there is increased activity, with many companies making confidential submissions. He anticipates a more normalized environment in the latter half of the year, especially as companies file publicly after Labor Day. Public-market investors are particularly focused on AI innovation, examining its potential impacts on financial models and disruption risks.
2025 Debuts
As of mid-August, 13 U.S.-based venture-backed companies have gone public with valuations of $1 billion or more, compared to eight in all of 2024. These IPOs were collectively valued at $86 billion at IPO price, up from $56.5 billion in 2024. Notable IPOs include Figma and Circle, which saw first-day pops exceeding 100%, and CoreWeave and Chime with strong performances. Rory O'Driscoll of Scale Venture Partners highlighted that public markets now offer cheaper capital, making it an opportune time for companies to raise funds.
M&A Rose
M&A activity in 2025 has totaled $84 billion across 22 transactions, surpassing the previous peak of $68 billion in 2021. The largest deal is Alphabet's planned $32 billion acquisition of Wiz, followed by significant acquisitions in sectors like semiconductors (e.g., Ampere Computing), AI healthcare workflows (e.g., Modernizing Medicine), and wireless networking (e.g., Digital Global Systems). Transaction counts are similar to 2024, but values are up significantly year over year.
Greater Confidence
The successful debut of Figma, trading at twice its IPO price, signals market openness for tech companies with growth stories involving AI. The stronger M&A market indicates a more confident dealmaking environment, with ongoing monitoring of market developments.
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