Travel Startup Funding Poised to Hit a New Low in 2025
Funding for travel startups saw a modest rebound in 2024, rising to $5.8 billion from $5.3 billion in 2023, according to Phocuswright’s report The AI-Native Edge: Travel Startups 2025. However, both years still marked decade lows, falling well below the previous 10-year low of $6.6 billion recorded in 2016—far from the $16.3 billion peak in 2021.
Through the third quarter of 2025, travel startup funding totals just $3.5 billion, signalling that the full-year amount will likely fall below $5 billion, setting a new historic low.
Deal volume tells a similar story. Only 161 funding rounds have been completed so far this year, compared to annual averages of around 1,000 a decade ago. Deal counts have been steadily declining since 2020, when rounds first dipped below 800. At the current pace, 2025 is projected to end with just over 200 rounds—another record low.
The shrinking number of deals underscores the growing concentration of capital in fewer companies. Among the 3,528 startups analysed, only 209 have raised more than $100 million, yet these companies account for $81.9 billion—an overwhelming 83% of total funding directed to just 6% of firms.
Related news: https://airguide.info/category/air-travel-business/artificial-intelligence/, https://airguide.info/category/air-travel-business/travel-business/
Sources: AirGuide Business airguide.info, bing.com