- Funding
- Stage analysis
- Q2 2026
- Mega-rounds
AI Funding’s Missing Middle
Seed deals hit a three-year high and $100M+ mega-rounds took 95% of disclosed dollars, while Series D+ rounds fell from 40 to 10. Q2 2026 in 480 rounds: the growth-stage gap opening in the middle of the AI market.
By AI Market Watch Editorial · July 10, 2026 · Snapshot 2026-07-10
On May 28, Anthropic closed a $65 billion Series H at a $965 billion post-money valuation — a single round so large that, by Crunchbase’s count, it absorbed close to one-third of all global venture funding in the second quarter. In our own dataset, which tracks AI companies specifically, it accounted for roughly half of every disclosed dollar raised between April and June.
The number that says more about where AI funding is heading, though, is 10. That’s how many Series D or later rounds we recorded across 4,614 tracked AI companies in Q2 2026, down from 40 in Q2 2025. Seed deals hit a three-year high. Mega-rounds took a record share of capital. And the growth stages between them are emptying out. The shape this leaves behind is a barbell: heavy at both ends, hollow in the middle.
- 40 → 10
- Series D+ rounds, Q2 2025 vs Q2 2026
- 95%
- of disclosed dollars in $100M+ rounds
- −20%
- Series C median round size, YoY
01 — The barbell, drawn
Early stages get the deals, the top gets the money — and Series C gets neither
We analyzed 480 announced funding rounds from Q2 2026, deduplicated and currency-corrected (see methodology below). One chart carries most of the story: for each stage, the share of deals set against the share of dollars.
| Stage | Share of deals | Share of dollars |
|---|---|---|
| Pre-Seed | 11.5% (55 deals) | 0.8% ($1B) |
| Seed | 30.2% (145 deals) | 2.3% ($3B) |
| Series A | 21.9% (105 deals) | 5% ($6.5B) |
| Series B | 13.1% (63 deals) | 16.4% ($21.3B) |
| Series C | 5.2% (25 deals) | 2.6% ($3.4B) |
| Series D+ | 2.1% (10 deals) | 52.5% ($68.2B) |
A funnel that narrows with each stage is normal: that is what venture is. What changed is the shape of the funnel over the past year. Set against the same quarter in 2024 and 2025, every rung of the ladder is more crowded than it was, right up to the point where the ladder stops.
| Stage | Q2 2024 | Q2 2025 | Q2 2026 |
|---|---|---|---|
| Seed | 135 | 134 | 145 |
| Series A | 76 | 107 | 105 |
| Series B | 42 | 56 | 63 |
| Series C | 17 | 19 | 25 |
| Series D+ | 11 | 40 | 10 |
- The seed machine is running hot. 145 seed rounds in Q2 2026, the highest Q2 in our data, plus 55 pre-seed deals. Early-stage rounds (pre-seed through Series A) made up a steady ~63% of all deals.
- Series B is holding. 63 rounds, up from 56 a year ago, at a median of $55 million.
- Beyond Series C, the market evaporates. Series D+ went from 40 deals to 10, fewer than in Q2 2024, before the AI boom’s late-stage wave even began.
Meanwhile, the dollars kept concentrating. In Q2 2026, roughly 95% of all disclosed capital went to rounds of $100 million or more, up from 82% a year earlier and 71% in early 2024. One in five announced rounds is now a mega-round.
| Quarter | Share of dollars |
|---|---|
| Q1 ’24 | 70.9% |
| Q2 ’24 | 83.8% |
| Q3 ’24 | 91.4% |
| Q4 ’24 | 86.2% |
| Q1 ’25 | 90.5% |
| Q2 ’25 | 81.6% |
| Q3 ’25 | 84.9% |
| Q4 ’25 | 93.1% |
| Q1 ’26 | 94.2% |
| Q2 ’26 | 94.9% |
02 — The pricing signal
Round pricing rose at every stage except the middle
One more detail separates a concentration story from a barbell story. Seed medians rose from $5.0M to $6.3M. Series A jumped from $18M to $23M. Series B climbed to $55M. But Series C — the classic “prove the business scales” round — fell from a $100M median to $80M, even as deal count ticked up. The middle of the market is the only place where capital got cheaper, at exactly the moment the stage above it disappeared.
| Stage | Q2 2025 median | Q2 2026 median | Change |
|---|---|---|---|
| Pre-Seed | $2M | $2.2M | +10% |
| Seed | $5M | $6.3M | +26% |
| Series A | $18M | $23M | +28% |
| Series B | $45M | $55M | +22% |
| Series C | $100M | $80M | -20% |
Where the big money actually went
| Company | Category | Round | Amount |
|---|---|---|---|
| 🇺🇸 Anthropic | Foundation Models | Series H | $65B |
| 🇺🇸 Prometheus | Industrial AI | Series B | $12B |
| 🇺🇸 Cerebras | AI Infrastructure | IPO | $5.6B+ |
| 🇨🇳 CXMT | AI Chips / Memory | Pre-IPO | $4.3B |
| 🇺🇸 Hut 8 | AI Infrastructure | Debt | $3.25B |
| 🇨🇳 Stepfun | Foundation Models | Pre-IPO | $2.5B |
| 🇬🇧 Isomorphic Labs | AI Drug Discovery | Series B | $2.1B |
| 🇨🇳 Kling AI | Generative Video | Series A | $2.0B |
Look at the round labels in that table. A $12 billion “Series B.” A $2 billion “Series A.” Debt, pre-IPO placements, an IPO. Almost none of the quarter’s biggest checks passed through the traditional C-D-E-F growth ladder at all. Even Jeff Bezos’s Prometheus, nominally at Series B, has raised $18 billion across two rounds, more than most companies raise through an entire alphabet of rounds and an IPO combined.
03 — Why the middle is vanishing
Three forces are squeezing the growth stages at once
1. The frontier is eating the pool
Global venture funding hit a record $510 billion in H1 2026, and more than 70% of Q2 startup capital went to AI companies, up from just under 50% a year earlier. But OpenAI and Anthropic alone took $217 billion, 43% of the entire half-year total. Analysts have started describing venture capital as a bifurcated market: “an enormous, capital-intensive frontier at one end, a normal-sized venture market at the other, and very little in between.” When growth-stage funds can get allocation in a frontier lab’s round — with hyperscaler co-investment and a visible IPO path — a $150M Series D in an applied-AI company competes for the same dollars and loses.
2. The graduation gate narrowed
Being outbid is only half of it; the middle is also being filtered. Carta cohort data shows only 9% of companies that raised a Series A in late 2022 reached Series B within two years, versus 25% for the 2018 cohort. Median time between rounds has stretched to roughly 23 months, and bridge rounds now account for over 22% of the cash raised by Series A companies. Fewer companies are earning their way to the growth stages, and the ones that stall raise extensions instead of new lettered rounds: deals that never show up as Series C or D.
3. Exits are replacing the ladder’s top rungs
The strongest mid-to-late-stage AI companies increasingly skip the ladder entirely. Q2 2026 set records on both exit paths: 24 acquisitions at $1B+ (a combined $113 billion, the highest quarter ever) and 32 IPOs above $1 billion. Cerebras raised $5.5B+ in its IPO and popped 108% on day one; SpaceX agreed to acquire Cursor-maker Anysphere for $60 billion days after its own listing. Add cheap structured debt for infrastructure players (Hut 8’s $3.25B this quarter), and a would-be Series D company in 2026 has three alternatives that didn’t meaningfully exist in 2023: sell, list, or borrow.
04 — What it means
Getting in has never been easier; getting through has never been harder
For founders: seed and A rounds are bigger and more numerous than ever, but the checkpoint after Series B may not exist by the time you reach it. Plan for capital efficiency that makes Series C optional, and treat strategic acquirers and debt as first-class financing paths rather than fallbacks.
For investors: the middle is the only part of the AI market where prices fell last quarter. A 20% decline in Series C medians during a record-capital quarter is a warning about the stage, and it is also an entry price. The companies that clear today’s narrower graduation gate are a more selected cohort than the 2021-22 vintages, and they cost less than they did a year ago.
For the ecosystem: the middle stages are where independent, at-scale companies come from. A market that funds a thousand seeds and a handful of $10B+ champions, with no ladder between them, defaults to consolidation: the seeds that work get absorbed by the giants long before they can challenge them.