Funding for Indian startups fell 29 per cent year-on-year (Y-o-Y) to $1.6 billion in the first quarter (Q1 CY23) of calendar year 2024, a report has said. Sequentially, funding fell 20 per cent from $2 billion in the previous quarter.
India secured the fourth-highest position globally in terms of funding raised in Q1 after the United States, China and the United Kingdom, said the report by Tracxn, a market research firm.
Investments in India dipped after growing for three quarters in 2023.
Late-stage funding dropped more than 46 per cent, but early stage increased 28 per cent. Indian startups got $1.6 billion in funding in Q1. Shadowfax and Credit Saison received the highest amount: More than $100 million together. Capillary, Rentomojo, and Captain Fresh are other startups that rank high in funding.
Q1 had two new unicorns (a startup valuеd at $1 billion or more): Fintech firm Perfios and artificial intelligence specialist Ola Krutrim.
“Despite the funding slowdown and economic fluctuations, India’s tech startup ecosystem is still one of the top-performing tech ecosystems globally. Even with the slowdown seen in this quarter, we anticipate the bounce back quickly, propelled by government initiatives and a large consumer base comprising the world’s largest young population. India’s strong tech ecosystem and demographic advantages promise a bright future and solidify its position as a global tech leader,” said Neha Singh, co-founder of Tracxn.
Retail, fintech, and enterprise applications were the top-funded sectors in Q1 (Until March 15). Retail got $494 million, a 34 per cent decline compared to the previous quarter.
Enterprise applications got $448 million, growing 48 per cent compared to $302 million received in the previous quarter. Fintech got $429 million, marking a 48 per cent growth from the last quarter’s $289 million.
Bengaluru was the leader in total funds raised in Q1. It was followed by Mumbai and Noida.
First Published: Mar 26 2024 | 2:36 PM IST