Civic News
AI / Autonomous tech / Robotics / Venture capital

VC funding jumps 200% in Pittsburgh, for second-highest annual total on record

The region was top 10 in the nation for AI and autonomous vehicle investments in 2023, while robotics was also strong

View from the Duquesne Incline of the Monongahela and Allegheny rivers meeting at the Point. (Danya Henninger/
Despite a rocky beginning, 2023 marked Pittsburgh’s second-highest year on record for venture capital fundraising, according to a just-released report.

The latest assessment by Ernst & Young and Innovation Works showed things picked up steam after the region recorded a record low in Q1 investment, leading to an annual 2023 deal value total of $3.12 billion for the local tech ecosystem.

That’s an impressive 203% year-over-year increase, and makes last year second only to the banner year Pittsburgh had in 2021, which saw an investment total of $3.59 billion. It also makes the region a bright spot — on a national level last year, fundraising declined by 30%.

Local VCs appear to have been right to remain optimistic in the wake of Q1’s mere $14.45 million across 15 deals.

“It’s hard to tell when things will pick back up exactly, but I think as the economy starts to stabilize, as well as the specific venture/startup ecosystem being stabilized, I think you will certainly see” an increase, Zach Malone, a partner at Magarac Venture Partners, told in early 2023. “The more comfortable investors feel and the more comfortable companies [feel], you’re going to see them raise that capital.”

Pittsburgh did see a 5.7% drop in deal count in 2023, but the local outlook is again better than the national picture, which saw a 22.6% decline in number of deals versus the previous year.

Download the full report

VCs have generally acknowledged that investors last year were being more cautious about how they spend, due to lingering effects from the pandemic along with the precarious state of the economy. Yet 136 Pittsburgh companies were able to secure investments, per the report, with an average disclosed deal of $27.1 million.

Innovation Works CEO and President Ven Raju attributed this to the resilience of the Pittsburgh tech economy.

“The strength and resiliency of the regional tech ecosystem was reaffirmed in 2023, despite macro headwinds and significant contraction in venture funding nationally,” Raju said. “Almost every indicator related to the local fundraising environment saw a material uptick.”

Alongside AI, hardware is hot

Sectors that received the most funding in Pittsburgh last year. according to the report, were robotics, autonomous vehicles, and artificial intelligence

Investments in the areas of hardware and robotics made up 68% of 2023 Pittsburgh investments, a huge jump compared to the 39% invested in those sectors in 2022. There were a handful of giant deals that skewed these results, Innovation Works’ Raju noted, but the trends are positive.

“While we saw some outsized investments in robotics and autonomous vehicle companies in 2023, the three-year rolling averages suggest sustained and broad-based growth for the region,” Raju said. “The 2023 data also suggests emerging trends in automation and AI, key regional clusters, are helping to catapult investment in Pittsburgh to Tier 1 levels.”

When it comes to AI, the current darling of the VC scene, Pittsburgh was among the top 10 for deals across the nation. The region was also top 10 in the US for deals in autonomous vehicles, a sector where investments have generally been shifting to China.

Moving forward, investors are still feeling cautious in an uncertain world, the report notes, but Pittsburgh’s future is still bright — especially if there were more local VCs willing to invest in local tech.

“By addressing the gap of local investment in Pittsburgh’s tech economy, we can unlock new avenues for development, creating an environment where local investors can play a larger role in fostering our community’s growth,” said Darrell Smalley, managing partner for Ernst & Young Pittsburgh office.

“With a healthy pipeline of local funding sources, the region can retain more of the financial rewards that come with the innovation Pittsburgh is increasingly known for.”

Atiya Irvin-Mitchell is a 2022-2024 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Heinz Endowments.
Companies: Innovation Works (Pittsburgh)

Join the conversation!

Find news, events, jobs and people who share your interests on's open community Slack


Pittsburgh weekly roundup: Neighborhood newspaper for tech; Bartel honored at CIO awards; $204M for broadband internet

Revitalizing our coverage to connect Pittsburgh's tech and startup scene

This Week in Jobs: Don't sleep on these 23 tech career opportunities

Pitt startup team wins 2024 Big Idea Competition with innovative neurosurgery device

Technically Media