AI, robots take top spot in contech investments

Dive Transient:

• Greater than half — 55% — of the $3.55 billion invested in development know-how within the first quarter of 2025 went towards funding next-generation robotics and artificial intelligence-enabled technology, in comparison with lower than 30% in all of 2024, in response to a report from Chicago-based Nymbl Ventures, a enterprise capital agency specializing within the constructed world.
• The agency mentioned the metric was outstanding, when contemplating that the broader enterprise capital panorama solely had a 30% allocation to AI, in response to the report.
• By itself, AI was the winner within the quarter — 46% of whole funding {dollars} went towards AI-enabled options, a major enhance from a median of 25% in 2024 and fewer than 20% in 2023, per the report. 

Dive Perception:

The report divided funding into three classes:

• Constructing tech: Options for builders, house owners, operators, underwriters and brokers of economic, industrial and residential buildings, comparable to HVAC techniques, structural elements, digital twins and carbon administration.
• Infrastructure tech: All applied sciences associated to the upkeep, administration and optimization of horizontal belongings comparable to bridges, roads, superior manufacturing and utilities.
• Development tech: All applied sciences concerned within the development of vertical and horizontal belongings which can be eliminated on the finish of a mission, comparable to mission, discipline and workforce administration; financing; preconstruction; and industrialized development options.

Of the three classes, the development tech phase was the one one to see year-over-year development, in response to the report. It rose 46% from 2024’s similar interval and 17% quarter over quarter. In contrast, investments in constructing tech and infrastructure tech had been considerably lowered — down 58% and 29% yearly, respectively, and 65% and 14% for the quarter.

On the deal aspect of investments, growth-stage funding rounds remained robust in Q1, with 47 post-Sequence A offers. This was second solely to This autumn 2024, which noticed 53 Sequence B and later-stage offers shut, per the report. 

Nevertheless, there have been few exits — eight total — following market volatility and an unsure financial system, because the world grappled with the potential of tariffs popping out of the U.S. Of these eight, seven had raised lower than $15 million, and no less than three of the companies had been distressed. Final yr, there have been 42 exits total, according to Nymbl. In different phrases, buyers have chosen to remain within the sector, for now, besides when their arms have been pressured by deteriorating situations. 

Wanting ahead, Nymbl Ventures predicts that M&A exercise will proceed to be sluggish as buyers and patrons wait out financial uncertainty. Regardless of the cautious estimate, it mentioned that the enterprise atmosphere’s outlook stays robust.

“Enterprise debt, distressed M&A and extremely selective investing into early and growth-stage startups are prone to be rising themes of Q2,” the report mentioned.