Is 2025 the year of the Chief AI Officer? & US RegTech funding drops 28%
As artificial intelligence (AI) continues to reshape the financial sector, many institutions are grappling with how best to govern, oversee, and integrate this transformative technology. The rise of AI has not only introduced new efficiencies and competitive advantages but has also brought challenges in ethics, compliance, and risk management. Given these complexities, some industry experts predict that 2025 could be the year financial organisations widely adopt a new C-suite role—the Chief AI Officer. But is such a role essential, or can existing leadership structures adapt to AI’s demands?
Read the full story here.
Research highlight
US RegTech funding dropped by 28% in 2024 as deals under $100m hit five year low
Key United States RegTech investment stats in 2024:
US RegTech funding dropped by 28% in 2024 YoY
The US RegTech market experienced a noteworthy decline in both deal volume and total funding in 2024.
The year closed with 228 deals, representing a 45% drop from the 413 deals recorded in 2023 and a 41% decline from the 389 deals seen in 2020.
Total funding in 2024 amounted to $5bn, reflecting a 28% decrease from the $7bn raised in 2023 but a 15% increase from the $4.3bn secured in 2020.
Despite the decline in deal count, the average deal size surged to $22m in 2024, marking a 30% increase from $16.9m in 2023 and an 82% rise from $11.2m in 2020.
Smaller deals (sub-$100m deals) dropped by 38% to their lowest level in the past five years
Funding from deals under $100m totalled $2.1bn in 2024, down 38% from the $3.4bn recorded in 2023 and a 28% decline from the $2.9bn seen in 2020.
Notably, this marks the lowest level of funding for sub-$100m deals in the past five years, underscoring a more cautious stance from investors toward smaller transactions.
Meanwhile, larger deals valued at $100m or more accounted for $2.9bn, marking a 19% drop from the $3.6bn raised by deals in that size bracket in 2023 but a 2x surge from the $1.4bn secured in 2020.
While high-value transactions continued to represent a significant share of total funding, the overall decline in both smaller and larger deal volumes suggests a cautious investment landscape, as market participants reassess risk amid evolving regulatory demands.
Norm AI, an emerging leader in AI-powered regulatory compliance, secured one of the biggest US RegTech deals in 2024 with a Series A funding round of $27m
The funding round was led by Coatue, with participation from Bain Capital Ventures, Blackstone Innovations Investments, Citi Ventures, and others.
Norm AI has raised over $38m from institutions managing more than $5.75tn in assets.
Norm AI has developed the first platform that translates government regulations into computer code, enabling companies to automate compliance analyses efficiently and accurately using Regulatory AI Agents.
These AI-powered agents convert regulations into executable programs, allowing businesses to ensure compliance with greater speed and precision.
Already deployed by Fortune 100 companies, Norm AI is transforming how industries like insurance and asset management handle regulatory assessments, reducing the time spent on compliance from days to minutes.
This new funding will help Norm AI expand its platform and further integrate AI into compliance processes, positioning the company as a pioneer in the RegTech space.
The company specialises in safeguarding cyber-physical systems (CPS) across various sectors, including industrial, healthcare, commercial, and the public sector, while ensuring regulatory compliance through comprehensive risk management and monitoring solutions.
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