Australia’s Tech Startups Top $1 Billion in Q3 2025 as AI and Deep Tech Drive the Rebound

Australian startups raised just over $1 billion in the third quarter of 2025, the strongest funding quarter of the year. AI and deep tech led the charge, Firmus Technologies closed a $330 million mega round to join the unicorn ranks, early stage dealmaking hit 116 rounds, and funding for teams with female founders fell to 11 percent of total capital.

A clear rebound in the numbers

After a slow first half, the ecosystem snapped back in Q3. Local startups collectively secured about $1.0 billion, according to Cut Through Venture’s Quarterly Funding Report. As Forbes Australia reported, the lift was not a mild improvement. It marked a firm return to risk-on behavior from investors, paired with the most active quarter of the year by deal count. A total of 116 rounds landed, an indicator that the early stage engine is running hot again.

Firmus Technologies steals the spotlight

One deal towered over the rest. Firmus Technologies, a deep tech contender, raised $330 million and became Australia’s newest unicorn. It was the only nine-figure round in the quarter and represented roughly a third of all capital raised. The gap that followed shows a market still short on late stage liquidity while the earliest stages hum along. That pattern mirrors global venture markets where a handful of outliers dominate the top end.

AI and deep tech pull in the capital

Investors leaned into AI and deep tech across software, advanced hardware and biotech. The global AI wave that sent billions toward category leaders has reached Australia too, echoing moves like the record round for Anthropic detailed here. A broader look at 2025 shows the same pattern. As noted by The Economic Times, citing CB Insights, AI startups have captured about half of all venture funding so far this year. Cut Through Venture reports valuations ticked higher across stages, with clear premiums for AI-first companies. Hardware that supports AI, including advances in silicon photonics for AI chips, is drawing steady attention alongside software plays.

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Early stage activity accelerates

Beneath the headline numbers, the foundation looks lively. Q3 delivered 85 venture rounds and 31 accelerator rounds, making it the busiest quarter of 2025 by count. Pre-seed and seed deal sizes pushed toward record levels, a sign that investors are willing to pay up to secure early exposure to standout teams. The result is a wide base of new companies moving through accelerators and into their first institutional checks.

The gender gap in funding widens

Progress for women founders remains uneven. There was a bright spot as female-only led startups posted their strongest showing since early 2023. Even so, the share of capital going to female-only and mixed-gender founding teams fell to 11 percent, the weakest result in six quarters, according to Cut Through Venture. The divide is starkest at later stages, where most large rounds continue to go to all-male teams. Early gains at seed are not yet translating into scaled outcomes.

Investor sentiment shows cautious optimism

Venture investors are sounding more constructive, but they are still careful. Portfolio health looks a bit better, according to Cut Through Venture, and bridge rounds continue to show up as founders extend runway. Layoffs and shutdowns have steadied. Use of venture debt remains muted. That points to a market that prizes discipline while returning to growth. Security remains a board level focus, especially after the recent hacking campaign across Australia. More than half of VCs expect to do more deals than in 2024, yet many remain selective on large late stage checks.

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Outlook for the rest of 2025

Trends from Q3 are set to shape the run home. Investors are leaning into AI-first and deep tech while keeping a close eye on valuation discipline. If momentum holds, Q4 could challenge recent records, with climate tech and advanced hardware expected to remain resilient given their long term potential and tangible impact. The message is simple. Keep the excitement in check, focus on durable unit economics, and prove a clear path to profitability. Australia’s tech scene is back on its feet, and the next stretch will show how durable this rebound really is.