Early-stage investment in Wisconsin continues to decline from its 2021 peak as the state is largely missing out on AI-related investment activity.
Wisconsin last year saw about $374 million in early-stage capital raised through 92 deals, according to figures collected by the Wisconsin Technology Council and presented yesterday at a luncheon event in downtown Milwaukee.
The figures for 2024 marked a decline from 2023’s totals of $490 million and 107 deals. The prior year had the same number of deals but a higher total with $640 million, but even that was a substantial decline from the standout year of 2021, when the state had $869 million raised through 140 deals.
While the state has generally followed the national trends for investment activity in 2021, 2022 and 2023, that changed in 2024 as the national picture improved from the prior year.
“If you look in 2024, our numbers are down whereas the national numbers are up, so something is happening,” Tech Council Investor Networks Director Joe Kremer said yesterday, adding “we’re starting to slip.”
The national increase is a result of more venture capital dollars being funneled into artificial intelligence, experts said during yesterday’s event. But Wisconsin doesn’t seem to be benefitting from this AI investing boom as much as the country overall.
Mary Hannes, associate director of Golden Angels Investors in Brookfield, said national VC growth last year was “driven heavily by the huge AI investments” in leading companies like OpenAI and Anthropic. At the same time, numerous smaller companies are also raising rounds and contributing to the broader national trend.
But in Wisconsin, the top deals for last year were largely clustered in health care, Hannes noted.
“We did not see that kind of mix of a whole bunch of new AI investing in the state, like they saw nationally,” she said yesterday. “And even nationally, as you can think about it, it’s pockets … I’m sure they didn’t get that in Iowa or Minnesota, right, it’s on the coasts and other tech hubs.”
Brian Lindstrom, a partner at HealthX Ventures in Madison, echoed her sentiment on Wisconsin missing out on the “AI revolution.” He noted as much as 50% of all investments are going into AI applications and “valuations are crazy” for these businesses.
“I’d love to see more of that in Wisconsin,” he said.
Meanwhile, Kremer said the state’s top 10 largest deals for 2024 represent a smaller pool of money than in recent years, noting “we’re seeing the slippage” in this measure.
The single largest deal from last year was Elephas Biosciences’ $55 million round, and the top 10 together equaled about $263 million. In 2023 and 2022, the largest deals were for $156 million and $240 million, pushing up the total amount for the top 10 for those years to $359 million and $473 million, respectively.
These figures and other findings will be included in the Tech Council’s 2025 Wisconsin Portfolio report, which will be released in the coming weeks. See reports for earlier years here.
