CY24 trend so far: Two unicorns, but funding to startups down 29%

India 4th-largest recipient of funding

Indian startups received $1.6 billion during January 1 to March 15, 2024, down 29 per cent compared to the same period last year, according to a report by market research firm Tracxn. Sequentially, funding fell 20 per cent from $2 billion in the previous quarter.

Investments in India fell after growing for three straight quarters in 2023.

While late-stage funding dropped more than 46 per cent, early-stage  funding increased 28 per cent.

Despite the overall downward trend, India was the fourth-largest recipient of funding in the period. The US led the charts, and was followed by China, and the United Kingdom, according to the report. The inflows minted two Indian unicorns, which refers to a startup valued at $1 billion or more, fintech firm Perfios, and artificial intelligence company Ola Krutrim.

“Despite the funding slowdown and economic fluctuations, India’s tech startup ecosystem is still one of the top-performing tech ecosystems globally,” said Neha Singh, co-founder, Tracxn.  Singh said that even with the slowdown seen in this period, government initiatives and a large consumer base  were likely to help investments to quickly bounce back. 

Retail top sector

Retail ($494 million), fintech ($429 million), and enterprise applications ($448 million) were the highest-funded sectors in Q1 (until March 15).  Bengaluru lead in total funds raised in Q1. It was followed by Mumbai and Noida.