December 2025 Report
Keyword: Barbell
Based on the SignalRank dashboard for December 2025, here is a report on the global Venture Capital trends for the month of December.
The narrative was written by a highly trained agent with access to SignalRank’s data. This agent will produce a report each month and can also do quarterly and annual reports.
December 2025 closed the year with a striking pattern: massive capital concentrated at the extremes. A $475M seed round and multiple $300M+ Series B rounds dominated headlines, while Series C capital was captured by two Chinese mega-deals. The “hollow middle” persists - companies without AI or defense theses face an increasingly selective capital environment.
Executive Summary
December delivered $18.1 billion across 733 rounds, marking a strong close to 2025. The defining characteristic was extreme capital concentration: the top 10 deals accounted for over $4.8 billion (27% of total capital). AI infrastructure, defense technology, and Chinese EV/mobility dominated the largest rounds.
Total Capital Deployed: $18.1 Billion
Deal Volume: 733 Companies / Rounds
Active Investors: 2,273
Average Round Size: $24.7 Million
Median Round Size: $5.0 Million
Investment by Stage
Series B dominated total capital allocation with $5.45 billion across 90 companies, while Pre-Seed and Seed together accounted for 432 companies - nearly 60% of all deal activity. The gap between average and median round sizes reveals the power law at work: a few mega-rounds pull up stage averages dramatically.
The data shows Late Stage (E+) rounds maintaining the highest average size at $172.7M, driven by growth rounds in geothermal energy (Fervo), cybersecurity (Cyera), and fintech (Airwallex). Series A averaged a healthy $24.1M, suggesting strong conviction capital remains available for post-seed companies with demonstrated traction.
Geographic Distribution
US Capital by State
California dominated US startup funding in December with 47% of total capital, followed by New York (17.2%) and Texas (15.5%). Texas’s strong showing was driven by a single outlier - Houston-based Unconventional AI’s $475M seed round. Delaware’s 6.7% share reflects the state’s role as corporate domicile for VC-backed companies.
Global Capital by City
San Francisco and New York led global funding with $16.1B and $12.9B respectively, but December’s geographic story was one of dispersion. Freiburg im Breisgau, Germany emerged as an unexpected hotspot with $10.2B in funding, driven by Black Forest Labs’ continued AI image generation dominance. Chinese cities collectively captured over $20B when aggregating Beijing, Jiading, Haidian, Changning, Chongqing, Hangzhou, Shanghai, and Wuxi Shi - underscoring China’s continued domestic venture activity despite geopolitical headwinds.
Key Trends and Observations
1. The “Mega-Seed” Phenomenon
Unconventional AI’s $475M seed round - led by Andreessen Horowitz and Lightspeed - represents the largest seed investment ever recorded. With participation from Jeff Bezos, Sequoia, DCVC, Lux Capital, and Databricks, this round signals that for AI infrastructure plays, the distinction between seed and growth rounds has collapsed entirely. The investor syndicate reads like an all-star team betting on compute infrastructure.
2. Defense Tech Ascendant
Castelion ($350M Series B), Radiant ($300M Series D for nuclear microreactors), and HawkEye 360 ($150M Series E for space-based RF intelligence) demonstrate continued institutional appetite for dual-use and defense-focused technology. The “Accelerationist Alliance” of a16z, Founders Fund, and Lux Capital appears repeatedly across these deals.
3. China’s Parallel Universe
Chinese startups raised significant capital in December despite US-China tensions. DeepBlue Auto ($873M Series C for autonomous driving), Moonshot AI ($500M Series C for AI), SIMIC Holdings($367M Series B for semiconductors), and Aipuqiang ($143M Series B for robotics) reveal a robust domestic funding ecosystem. These rounds are largely funded by state-backed or domestic Chinese investors.
4. AI Infrastructure Everything
From Black Forest Labs (image generation) to Chai Discovery(drug discovery) to Lovable (code generation) to Fal (inference infrastructure), AI-native companies commanded premium valuations and attracted the most competitive investor syndicates. The common thread: infrastructure enabling others to build with AI.
Top 10 Deals of the Month
DeepBlue Auto (China) - Series C: $873.5M - Autonomous driving
Saviynt (USA) - Series B: $700M - Identity governance
Moonshot AI (China) - Series C: $500M - AI foundation models
Unconventional AI (USA) - Seed: $475M - AI infrastructure
Fervo Energy (USA) - Series E: $462M - Geothermal energy
Cyera (USA) - Series F: $400M - Data security
SIMIC Holdings (China) - Series B: $366.8M - Semiconductors
Castelion (USA) - Series B: $350M - Defense technology
Lovable (USA) - Series B: $330M - AI code generation
Airwallex (Singapore) - Series G: $330M - Cross-border payments
Capital Concentration Analysis
The power law was pronounced in December. Single outlier deals captured significant percentages of total stage capital.
At the Seed stage, Unconventional AI alone represented 23.3% of all seed capital deployed in December. At Series C, two Chinese deals - DeepBlue Auto and Moonshot AI - combined for 44.5% of total Series C capital. This concentration underscores that for LPs, being in the right funds with access to these outliers is increasingly the only path to top-quartile returns.
Investor Analysis: The Overlapping Elite
December’s mega-rounds revealed a familiar pattern: the same elite investors appearing across multiple deals. Andreessen Horowitzled or participated in four of the five largest non-Chinese deals. Lightspeed Venture Partners co-led both the largest seed (Unconventional AI) and a top Series B (Castelion). Sequoia Capitalmaintained its presence across stages.
This “club deal” dynamic means access to elite rounds is increasingly gated by relationships. Funds outside this network face structural disadvantage in accessing the deals that drive returns.
SignalRank Series B Analysis
In the SignalRank methodology, a company “qualifies” not just by revenue or hype, but by the quality of its early backers. The core thesis is that top-tier Seed and Series A investors (the “Signal”) have persistent access to the best outliers.
December produced 13 SignalRank-qualifying Series B companies. Castelion achieved a perfect 100th percentile score, with its pedigree extending from Andreessen Horowitz at seed through its $350M Series B. Black Forest Labs (99.9th percentile) demonstrated the value of stacking elite investors: a16z, General Catalyst, NVIDIA, and Salesforce Ventures all participated.
The qualifying companies span AI infrastructure (Black Forest Labs, Lovable, Chai Discovery), cybersecurity (Adaptive Security, Vega), defense (Castelion), and enterprise software (Serval, PermitFlow). This diversity suggests signal quality transcends sector focus.
Summary of Trends
1. The “Infrastructure Thesis” Dominance
Whether AI compute (Unconventional AI), energy infrastructure (Fervo, Radiant), or software infrastructure (Fal, Lovable), the largest December rounds went to companies building fundamental capability layers. This pattern suggests investors are betting on pickaxe-sellers rather than gold miners.
2. The Club Deal Effect Intensifies
a16z, Lightspeed, Sequoia, General Catalyst, and a handful of other elite funds appear repeatedly across December’s mega-rounds. For emerging managers and outsider funds, access to these deals has become the binding constraint on returns.
3. Geographic Bifurcation
The US and China are developing parallel venture ecosystems with minimal capital flow between them. Chinese mega-rounds are funded domestically; US AI and defense rounds are funded by the usual suspects. Singapore (Airwallex), Israel (Syremis, Vega), and Germany (Black Forest Labs) emerge as the primary alternative destinations for US-aligned capital.
Data sourced from SignalRank with help from Crunchbase and Preqin. Analysis covers announced rounds from December 1-31, 2025.
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Incredible breakdown of the capital concentration dynamics. That $475M seed round for Unconventional AI consuming 23% of all global seed funding is wild, basically redefining what "seed" even measn anymore. I've seen this play out firsthand where traditional Series B companies struggle to get attention while AI infra plays skip straight from seed to $100M+ war chests. The hollowing out of non-AI companies in Series C/D is kinda brutal when half the capital goes to just 2-3 firms.