Indian tech start-ups secured $7.6 billion in funding so far in 2024, a sharp decline from the $22.4 billion raised in 2022, according to a report released by data platform Tracxn.
Currently, late-stage fundraising rounds have yielded $4.7 billion for the industry
Indian tech start-ups secured $7.6 billion in funding so far in 2024, a sharp decline from the $22.4 billion raised in 2022, according to a report released by data platform Tracxn.
2021 was a peak time for the sector, as they received funding of $29.9 billion. However, since then, the sector has witnessed a decline in funding due to ongoing geopolitical headwinds and the global funding winter.
Further, as per the report, majority of investment has been awarded in late-stage rounds. As of right now, late-stage fundraising rounds have given the industry $4.7 billion. In contrast, a total of $4.9 billion and $14.3 billion were recorded in the first three quarters of 2023 and 2022, respectively.
“While overall funding has slowed, late-stage investments and the increasing momentum in fintech and retail show that innovation-driven growth is still thriving in India’s startup landscape,” said Neha Singh, co-founder, Tracxn in a company statement.
The sector overall saw 12 funding rounds, exceeding $100 million as of 2024. Compared to it, the first nine months of 2023 saw 16 rounds of fundraising over $100 million. This suggests a minor slowing in large-scale funding this year.
One start-up that raised the most funding was quick commerce platform Zepto, which raised $1 billion in two consecutive rounds in a year. The company also raised a fund value of more than $500 million this year.
A number of other well-known firms have also raised more than $200 million in 2024: Meesho, API Holdings, Flipkart, DMI Finance, Apollo 24|7, and Rapido.
The report further mentioned that retail, fintech, and agritech emerged as the top sectors. Significant funding was received by the retail sector with a total of $1.95 billion in 2024. This indicates a growth of 23 per cent compared to $1.59 billion in 2022.
The fintech sector secured the second-highest funding in 2024, receiving $1.49 billion so far. However, this marks a decline of 39 percent and 70 percent compared to $2.46 billion in 2023 and $4.97 billion in 2022, respectively. The report also talks about the recent IPO boom in India and highlights that the country has six new unicorns.
This marks a 500 per cent increase compared to just one in 2023. Some of the prominent IPOs that went public this year include Aeron Composite, Firstcry, Unicommerce, Ola Electric, and RNFI Services. “The emergence of six new unicorns and a surge in IPOs with 29 tech companies going public in 2024 YTD reflects investor confidence in the ecosystem,” said Singh.
Meanwhile, the sectors that got most affected were edtech and aerospace, maritime, and defense tech. Funding in the ed-tech sector, for example, dropped from $215 million in 2023 to $116 million till date.