If you thought venture capital funding of AI firms was lower last year, you weren’t wrong. A new report from market analysis firm Signify Research found that VC funding of radiology AI firms dropped by nearly half in 2024 compared to the year before.
VC funding has become a closely watched barometer of the radiology AI segment’s overall health.
- As most AI developers haven’t generated significant cash flows from product revenues yet, VC money is the oxygen that keeps AI firms breathing.
And there are signs that after peaking in 2021, that oxygen is coming into short supply.
- Signify’s report last year documented a 19% drop in VC AI funding in 2023, a development attributed to tighter access to capital due to high interest rates.
Those trends continued into 2024, with the new Signify report finding …
- Total VC funding was $335.5M, down 48% compared to $645.6M in 2023.
- The number of funding rounds fell 35% (20 vs. 31), to the lowest level since 2015.
- Average deal size fell 16% ($16.8M vs. $20.1M).
- Cleerly raised the most in 2024 with $106M in funding, followed by Qure.ai with $65M (putting Qure into Signify’s elite “$100M Club”).
- Funding declines were even worse in the Asia-Pacific (-84%) and the Europe, Middle East, and Africa regions (-76%) compared to the peak in 2021.
Signify analyst Umar Ahmed noted that 2025 got off to a strong start, with $100M in funding rounds announced in January.
- This could either represent a rebound in investor confidence, or indicate that the AI funding cycle is getting longer as VC firms put developers under the microscope and demand better ROI for their investments.
The Takeaway
So it’s agreed that 2024 was a wash for VC radiology AI funding – what about 2025? The year’s strong start appears to have petered out as we approach the spring quarter, and ongoing regulatory turbulence and economic uncertainty in the U.S. isn’t likely to help. Stay tuned.
