According to a recent Silicon Valley Bank report, AI startups have captured about 40% of U.S. VC funding, significantly crowding out other sectors like infrastructure and cybersecurity. The report reveals a doubling of AI-focused venture funds over five years, which reflects both investor enthusiasm and the considerable capital needed for rapid growth in AI. Consequently, many traditional firms now face stiff competition for limited funding. This trend is also linked to the emergence of 'zombiecorns,' companies that, despite unicorn status, show poor growth and face uncertain futures, overshadowing the traditional startup landscape.
AI startups are dominating venture capital funding, acquiring roughly 40% of VC investment in 2022, significantly impacting other sectors that now compete for remaining funds.
The emergence of 'zombiecorns' signifies a troubling trend where once-promising unicorns struggle for survival amid declining investor interest and economic uncertainty.
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