87.5% of enterprise {dollars} went to AI. The relaxation fought over scraps

PitchBook released its Q2 2026 U.S. VC Valuations data this week, and the report aligns with the skewed venture market we’ve come to know: Investors are willing to pay up for a few anointed AI companies, and (almost) everything else is a pass or rounding error. For the first half of this year, AI megadeals were where 87.5% of all U.S. venture dollars went.

There are valuation step-ups outside AI—it’s just that the AI premium is undeniable. PitchBook says that non-AI companies at the median saw valuation step-ups of 1.6x, whereas for AI that was 2.2x. It’s Series D and later where the gulf gets vast, where for AI that number has become 6.6x.

“The Series D+ step-up is clear evidence of how much AI is driving venture valuations,” said Emily Zheng, PitchBook senior research analyst, via email. “Median velocity of value creation at that stage jumped from $108.9 million in 2025 to over $1 billion in 2026, nearly a 10x increase. Top AI companies like Anthropic are driving this growth, as its valuation grew 5.3x in just eight months. Venture returns already follow a power law, and AI has raised the bar for what an outsized valuation looks like.”

In this market, liquidity remains hard to find. Though there’s an IPO window of sorts, it’s hardly persuasive, with only SpaceX and Cerebras offering much evidence going public could be worth the trouble.

Acquisitions, on the face of it, have some promise: 2026 acquisition value so far has reached $375.4 billion, a decade high with valuations up to 1.9x from last year’s 1.2x, according to PitchBook. But breaking it down by deal, it’s clear that results are varied: ServiceNow’s Armis buyout was $7.8 billion, a jump from the cybersecurity company’s prior $6.1 billion valuation. Elsewhere, Capital One’s $5.2 billion Brex deal marked a serious haircut from the fintech unicorn’s peak $12.3 billion valuation.

The secondaries market is a useful mirror here: If the company is new and AI, you’re in demand. If the company is neither of those things, you have a problem. PitchBook notes that, on secondary trading platform Forge, startups that have raised this year or last were trading at a median discount of zero to 5%. Now, for startups that last raised in 2021 or 2022, that number transforms into a median of 54% and 59%.

“The winners are bigger than ever, overshadowing the rest of the venture market,” said PitchBook’s Zheng over email. “Companies that cannot raise on strong terms right now generally are not raising at all.”

To be clear, I’m not saying that those startups last backed in 2021 are uniformly great companies getting left behind—that era certainly had its share of irrational exuberance (remember NFTs?). I do think there are some solid companies dusted for being off-trend. Though what’s perhaps most interesting is the rate of change it reflects: Yes, data for the AI-addled venture market has looked roughly the same for a while.

But the world has very much turned over.

See you tomorrow,

Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com

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VENTURE CAPITAL

– MarginEdge, an Arlington, Va.-based restaurant back-office management and bill-pay platform, raised $80 million in Series D funding. Schooner Capital and Ten Coves Capital led the round and were joined by existing investors Osage Venture Partners, Derive Ventures, and Western Alliance Bank.

– Skan AI, a Menlo Park, Calif.-based process-intelligence platform, raised $63 million in funding. Cathay Innovation and Dell Technologies led the round and were joined by Citi Ventures, Bloomberg Beta, State Farm Ventures, and Wipro Ventures.

– Trajectory, a San Francisco-based AI infrastructure startup that helps companies continuously improve AI products using real-world user feedback, raised $40 million in funding, The Information reported. Sequoia led the round.

– Axle, a New York City-based AI-native insurance-data clearinghouse, raised $17.5 million in Series A funding. Base10 Partners led the round and was joined by Y Combinator, Gradient, and others.

– Legio, a Toronto-based AI-native campus public-safety operations platform, raised $5 million in seed funding. Klass Capital led the round.

PRIVATE EQUITY

– Thoma Bravo acquired Kneat, a Limerick, Ireland-based validation and quality-management software provider for life-sciences companies, for approximately C$650 million ($466.8 million USD) in cash. 

– Susquehanna Growth Equity invested $25 million in ApartmentIQ, a Madison, Wis.-based market-intelligence and revenue-management platform for multifamily owners and operators. 

– Air Transport Components, a portfolio company of AE Industrial Partners, acquired Aero Controls, a Seattle-based aviation services provider. Financial terms were not disclosed.

– Baymark acquired Meal Prep Sunday, a Vista, Calif.-based meal prep service. Financial terms were not disclosed. 

– Big Top Manufacturing, a portfolio company of Altamont Capital Partners, acquired Coast to Coast Contracting, a Fruitland Park, Fla.-based installation services and general contractor. Financial terms were not disclosed. 

– Currier Plastics, a portfolio company of Sheridan Capital Partners, acquired Sage Product Development, a Foxborough, Mass.-based engineering, design, and development provider for the medical device industry. Financial terms were not disclosed.

– Lindsay Goldberg acquired a majority stake in Alro Steel, a Jackson, Mich.-based metals and performance plastics company. Financial terms were not disclosed.

– Shurco, backed by Behrman Capital, acquired Heavy Motions, an Ontario, Calif.-based hydraulic parts supplier. Financial terms were not disclosed.