While venture money roared back across much of the country last year, Chicago’s startup scene quietly slipped in the opposite direction. Local founders watched the national headlines about big rounds and AI-fueled megadeals, then looked at their own term sheets and wondered whether the next wave of money will actually reach the lakefront.
Chicago’s Numbers At A Glance
Chicago-area companies raised about $2.6 billion in venture capital in 2025, down from roughly $3.3 billion in 2024 and short of the $3 billion mark. Deal volume also slid, with roughly 311 financings last year versus about 350 in 2024, leaving the region at a seven-year low for capital, according to Crain's Chicago Business.
Why The U.S. Numbers Look Bigger
Nationally, the story looks very different. PitchBook’s data show U.S. venture funding climbing roughly 59% to about $339 billion in 2025, with Silicon Valley alone accounting for roughly $177.4 billion, per the PitchBook‑NVCA Venture Monitor. A handful of eye-popping megadeals and AI-related rounds did much of the heavy lifting. Reporting from Reuters shows AI captured roughly two-thirds of funding value in 2025, concentrating capital in a relatively small circle of winners.
Local Reaction And Standouts
That concentration has not gone unnoticed along the Chicago River. “The AI push has disproportionately favored California, and New York has become another hotbed,” Ira Weiss, a partner at Hyde Park Venture Partners and a professor at the University of Chicago Booth School, told Crain's Chicago Business.
Even so, the city did notch some headline-worthy wins. Pathos AI closed a $365 million Series D that pushed its valuation toward $1.6 billion, according to Pathos. Crypto infrastructure player Zerohash raised about $104 million at roughly a $1 billion valuation, per Fortune. Those outliers underscore that Chicago still has serious chops in biotech and crypto infrastructure, even if the broader funding totals trail the coasts.
What Needs To Change
PitchBook’s monitoring shows megadeal activity remains below the frothy 2021 peak, which helps explain why midsize ecosystems like Chicago are getting sidelined when capital clusters at the very top. The familiar prescription keeps coming up: strengthen follow‑on capital, build tighter coast‑to‑Midwest investor connections and grow more local growth funds that can write bigger checks without sending founders on a one-way flight to San Francisco or New York.
Chicago’s deep corporate bench, healthcare research muscle and fintech talent still give the city a real shot at closing that gap. The question now is whether those ingredients get pulled together in time for the next surge of big rounds, or whether the city is left watching yet another funding boom roll by from the sidelines.
