Despite the challenges many tech startups have faced in 2020, funding has been in no short supply. According to TechCrunch’s quarterly report, US-based startups saw a total of $36.5 billion in funding in Q3, an increase of 30% from Q2. Among these funding rounds, however, there were a few tech markets that stood out based on the amount they received. And if data tells us anything, it’s that these are the markets to keep your eye on for the rest of the year and beyond. 

With the help of Crunchbase’s database, we’re highlighting the top five tech markets in 2020 based on recent funding. 

Cyber Security

The fifth highest-grossing market for tech startup funding is cyber security with a total of 220 companies receiving funding in 2020 so far. The collective total for the market funding rounds comes out to $4.5 billion. Palantir Technologies had the largest funding deal, raising $550 million in June. Palantir is a cyber security company based in Denver, Colorado that enables organizations to integrate data, decisions and operations into a single platform. 34.5% of industry funding went towards early-stage as well as seed rounds, with 12.4% funding going to late-stage ventures. 

Artificial Intelligence

The fourth market with the highest funding in 2020 is artificial intelligence. There have been 876 tech startups with completed funding rounds in this market. Those companies raised $9.6 billion so far in 2020, with over 50% of the funding occurring in a seed round. The largest funding within the market was a $462 million Series B round for Pony.ai, which is based in the San Francisco Bay area and focuses on building autonomous vehicles and currently has self-driving fleets in California and China. 

Software-as-a-Service (SaaS)

The third highest-earning market for tech startups is SaaS (software as a service), with 750 companies receiving some form of funding. These companies have raised $11.3 billion so far. The largest funding of $600 million went to San Francisco-based company Stripe, which uses its SaaS platform to enable companies to accept payments, send payments and manage their business online. 46.3% of total funding rounds in the SaaS industry went to seed rounds, while early-stage rounds received 22% of the funding and late-stage received only 8.3% of funding.

Information Technology

The second-highest funded market is information technology raising $13.4 billion. Since the start of 2020, 1,273 tech startups within the market have received some sort of funding, with 44.3% of the rounds being seed. Early-stage funding received 20.5% of the funding while late-stage received 4.6%. Cohesity, based out of San Francisco, California, had the third-largest round, which came in at $250 million in April. Cohesity is an innovator in multi-cloud storage and management. The company’s focus is to simplify data organization and eliminate mass data fragmentation.

Software

The highest funded market for tech startups was in the software industry; so far in 2020 the sector has raised $32.7 billion across 2,286 companies. When broken down, 45.1% of the funding rounds were categorized as seed, with early-stage garnering 23.2% of funding and late-stage getting just 7.1% of funding. Waymo, another autonomous driving technology company based in Mountain View, California, completed the largest funding round, raising $2.25 billion in early March.

Funding for tech startups is in no short supply, but companies in these five industries have received the most funding in 2020 and are showing no signs of slowing down. According to Crunchbase, 3,510 tech startups have completed some form of funding round and have raised $44.6 billion so far in these markets.

About Avalon Funk: Avalon is a Marketing Research Analyst for Swyft, which is a tech PR agency in Austin and Houston and a top digital marketing and PR agency in Denver since its founding in 2011. Swyft recently opened a satellite office where it offers tech PR in San Francisco. Swyft was also listed as one of the top tech PR agencies in Texas by the B2B services review site, Clutch.co.