Washington: The global semiconductor landscape has witnessed a tectonic shift as US-based chip startups closed 2025 with record-breaking venture capital investments. According to the latest Crunchbase data, funding for the sector reached a new zenith, propelled by a relentless appetite for specialized AI hardware and a strategic pivot toward domestic hardware sovereignty.
While the broader venture market saw a disciplined recovery, the semiconductor vertical stood out as a primary beneficiary of the “AI infrastructure” super-cycle. Investors are no longer just betting on software; they are pouring billions into the physical layer—the silicon that makes large language models (LLMs) and autonomous systems viable.
The primary driver behind this record-high funding is the explosive growth of Generative AI. With industry giants like OpenAI and Anthropic requiring massive compute power, startups focusing on AI accelerators, optical interconnects, and energy-efficient architectures have seen their valuations skyrocket.
The year was marked by several high-profile megarounds. Companies like Celestial AI, which focuses on optical interconnect technology for AI data centers, and Mythic, which develops energy-efficient AI microprocessors, secured significant capital to scale production.
Adding to the private sector enthusiasm is the sustained momentum from the CHIPS and Science Act. Federal incentives have not only encouraged established players but have also created a halo effect for startups, providing a clearer path to domestic manufacturing and commercialization.
As 2026 begins, industry experts suggest that the focus will shift from “funding for R&D” to “funding for scale.” With the US aiming to capture a larger share of the global logic chip production, these well-capitalized startups are expected to play a crucial role in reducing reliance on traditional supply chains.
However, the high burn rate of semiconductor development remains a challenge. “The stakes are higher than ever,” said a partner at a leading VC firm. “But for those who can deliver on performance and power efficiency, the market opportunity is virtually limitless.”