AI·Security startup companies spark a wave of mergers and acquisitions... Transaction volume reaching 307 trillion KRW in 2025, and it will be even hotter in 2026

The merger and acquisition boom in the risk investment market in 2025 has once again heated up, and it is expected that the competition for acquisitions of startups will become even more intense in 2026. Especially in the fields of artificial intelligence and cybersecurity, actions to quickly acquire talent and technology have been fully launched, with “technological competitiveness” and “technology acquisitions” becoming the core values of M&A.

According to Crunchbase data, in 2025, there were approximately 2,300 risk investment-based M&A transactions worldwide, with publicly disclosed deal amounts reaching about $214 billion. This figure represents a 91% increase compared to 2024. The US market accounted for 73% of these, serving as the M&A hub, with a total of 1,300 transactions amounting to $157 billion.

A representative case leading this trend is Google’s $32 billion acquisition of cloud security startup Wiz, the largest risk investment-based acquisition of a US startup in M&A history. Subsequently, large deals such as Naver Financial’s acquisition of Dunamu and Thermo Fisher’s acquisition of Clario followed one after another. In 2025, there were a total of 36 acquisitions of unicorn companies, with a combined value of $67 billion, setting a new record.

Interestingly, these acquisitions are interpreted not just as simple equity purchases but as strategic layouts to quickly acquire technology and talent. Particularly in the highly competitive field of artificial intelligence, “bold bets” on acquiring early-stage startups for hundreds of billions to trillions of Korean won are increasing. Lucas Heebart from Ernst & Young-Booz Allen explained, “It’s not just about structural adjustments; market leadership is driven by technology-led strategies.”

As a major shareholder and listed company, former President Trump’s Trump Media & Technology Group also attracted attention. In December 2025, the company announced it would merge with fusion technology specialist TAE Technologies through a share swap, with a deal valuation exceeding $60 billion. Despite the unusual combination of nuclear fusion and social media, its strategy of “maximizing technological growth and capital market leverage” has attracted market attention.

The driving force behind M&A, combined with the recovery of the IPO market, is a dual-track strategy that cannot be ignored. Anuj Bahal from KPMG stated, “A well-functioning IPO environment actually promotes M&A. The threat of going public provides bargaining chips in negotiations, and the practice of rapidly expanding externally after listing with ample cash flow has become increasingly common.”

As the M&A market reorganizes around technology, evaluation standards are also changing. Experts generally agree that a departure from traditional valuation multiples or EBITDA-based valuation models is occurring, with a growing emphasis on talent and intellectual property strategic value. Specifically, Itay Sagie from Sagie Capital Advisors pointed out, “M&A pricing between AI and non-AI businesses has diverged into a dual market structure.” He added, “AI deals are centered on talent and algorithm value, while other industries still primarily rely on valuation multiples derived from the public market.”

On the other hand, besides acquiring technology or talent, there are also many cases where M&A is chosen as an alternative to avoid funding difficulties. Analysts believe that the reduction in investment rounds and the frequent valuation downgrades in 2025 have led to an increase in M&A activity aimed at avoiding such risks. According to Ernst & Young data, about 16% of startup investment deals this year were classified as valuation downgrades, with many entrepreneurs opting to sell to prevent excessive equity dilution.

Looking ahead to 2026, experts tend to believe that M&A activity will slightly increase based on market recovery and expectations for growth in tech companies. Ernst & Young-Booz predicts that the number of M&A transactions within the US will grow by 3% next year. Bahal emphasized, “Core conditions for optimism include loose monetary policies, favorable regulatory environments, and the continuation of technology-driven growth industries.”

However, uncertainties still remain. Factors such as the possibility of continued interest rate hikes, concerns over overheating in AI, geopolitical tensions, and strengthened external regulations could inevitably lead the market back to a wait-and-see stance. Sagie analyzed, " M&A stagnation is not caused by a technological collapse, but rather when market confidence is shaken, investments will halt."

Ultimately, the M&A outlook for 2026 depends on confidence in “technology and talent,” the stability of the economic environment, and the recovery of investor confidence. It is expected that competition for acquisitions around AI, cybersecurity, and early-stage startups will continue, and the market is closely watching how this trend will peak in what form.