a16z Leads U.S. Startup Investments in a Slow January

The new year kicked off on a surprisingly quiet note for venture capital in the United States. While several large funding rounds still took place, the overall pace of deals from major venture firms slowed compared to previous months. Among the big names, only Andreessen Horowitz — commonly known as a16z — managed to reach double digits in startup investments during January.

The firm stood out in an otherwise cautious month for investors, completing 13 deals involving U.S.-based startups. Other well-known venture capital firms were active too, but none matched a16z’s pace.

a16z stays active despite slower market

Based in Menlo Park, Andreessen Horowitz participated in several major funding rounds during the month.

One of the biggest was a $180 million funding round for voice AI startup ElevenLabs, which valued the company at $3.3 billion. The round was co-led with ICONIQ Growth. The Brooklyn-based startup develops AI software that allows creators and businesses to replicate voices in multiple languages.

The venture firm also joined a $141 million Series B investment in Hippocratic AI, valuing the healthcare-focused AI company at $1.6 billion. Hippocratic AI focuses on building safety-focused large language models designed specifically for healthcare applications.

Another notable deal saw a16z participate in Whatnot’s $265 million Series E round, pushing the company’s valuation close to $5 billion.

But not all of a16z’s investments were massive. The firm also backed earlier-stage startups. It led a $24 million Series A round for Raspberry AI, a New York startup developing tools that transform designers’ sketches into photorealistic product images showing how clothing will look and fit.

General Catalyst follows behind

Coming in second for the month was General Catalyst with eight deals involving U.S. startups.

One of its key investments was co-leading a $50 million Series C round for Onebrief, a Honolulu-based company that builds web-based planning software used for military operations.

General Catalyst also participated in larger funding rounds for companies such as recruiting platform Mercor, which raised $75 million at a $2 billion valuation, and cloud application platform Render, which secured $80 million in a Series C round.

Alumni Ventures shows strong interest in AI

Alumni Ventures ranked next with seven investments in January — significantly fewer than the 19 deals it completed in January 2024.

The firm appears to be focusing heavily on artificial intelligence. It co-led a $5 million Series A round for Springbok Analytics, which uses AI to turn MRI scans into detailed 3D muscle analysis.

It also backed Final Round AI, contributing to the startup’s $6.9 million seed round. The company is developing tools designed to help job seekers improve their chances of landing employment.

Sequoia and Bessemer remain steady

Two well-known venture firms — Sequoia Capital and Bessemer Venture Partners — each completed six investments during the month.

Sequoia’s biggest move came in the crypto sector. The firm co-led a $150 million funding round for Phantom alongside Paradigm. The deal valued the crypto wallet provider at $3 billion. Phantom offers tools that allow users to buy, store, and manage digital tokens and NFTs.

Meanwhile, Bessemer led a $20 million Series A round for HockeyStack and co-led a $77.5 million Series B investment in ShopMy, which connects brands with content creators.

Other notable activity

Several other venture firms — including Pioneer Fund, New Enterprise Associates, Menlo Ventures, Khosla Ventures, and Elevate Ventures — each recorded five investments during the month.

In terms of funding size, Google made the biggest splash. The tech giant invested another $1 billion in Anthropic, adding to its previous $2 billion investment in the OpenAI rival.

Meanwhile, startup accelerator Y Combinator remained the most active incubator, completing 19 startup investments in January.

Although January began quietly, the deals that did happen show investors remain particularly interested in AI, crypto infrastructure, and software platforms — sectors that continue to attract large funding rounds despite a slower start to the year.