Indian tech startups secured $4.8 billion from January to June this year — a 25% decrease compared to the same timeframe in 2024, and down 19% from the latter half of the previous year. Nonetheless, India maintained its position above countries like Germany and Israel in total startup funding.
“Although funding volumes have decreased relative to the previous year, India’s tech ecosystem exhibits resilience and growth,” remarked Neha Singh, Co-Founder of Tracxn. She mentioned that strong investor interest in sectors such as transportation, retail, and enterprise technology highlights a growing confidence in the country’s ability to tackle significant structural issues in the long run.
The downturn can, in part, be linked to wider global challenges. A report by IVCA and EY noted a 68% year-on-year drop in private equity and venture capital investments in India in May 2025, driven by inflation, tighter monetary policies, and geopolitical tensions that have led investors to retreat from emerging markets. In India, the funding landscape is also evolving due to a shift in investor focus — from aggressive growth to sustainable business practices.
In a recent interview with PTI, investor and former Infosys executive TV Mohandas Pai highlighted that the country’s dependence on foreign capital is becoming a liability. He cited the insufficiency of domestic capital, onerous regulations, and inadequate R&D funding as key obstacles inhibiting the ecosystem’s progress.
“For instance, China invested $835 billion in startups and ventures from 2014 to 2024, while the US invested $2.32 trillion. In contrast, we contributed $160 billion, with about 80% sourced from overseas. Therefore, local capital is lacking,” he stated.
The Tracxn report indicates a decline in funding across all stages of startup development. Seed funding dropped to $452 million, nearly half of what it was a year earlier. Early-stage startups raised $1.6 billion, and late-stage companies collected $2.7 billion, both experiencing double-digit decreases. Furthermore, the number of significant deals — those exceeding $100 million — also diminished, with just five recorded in the first half of this year, down from nine in late 2024 and 10 during the same period last year.
Nonetheless, a handful of major fundraises made headlines. Erisha E Mobility secured a whopping $1 billion in Series D funding, followed by GreenLine with $275 million in Series A and Infra.Market raising $222 million in Series F. Other companies like Spinny and Darwinbox also garnered substantial investment.
Despite the overall funding decline, certain sectors witnessed renewed interest from investors. Transportation and logistics tech saw a notable resurgence, attracting $1.6 billion — a 104% increase compared to the previous half. Retail tech raised $1.2 billion, and enterprise applications pulled in $1.1 billion, though both were down from the same period last year.
Public market activity decreased, with 12 Indian startups going public, a drop from 21 a year prior. The names that made their debut included Ather Energy, Tankup, SS Innovations International, and Infonative Solutions. Only two unicorns — startups valued at $1 billion or more — emerged during this time, a decrease from three last year.
Mergers and acquisitions witnessed a significant uptick. The Indian startup landscape recorded 73 acquisitions from January to June 2025, an increase from 54 in the first half of 2024. Notable deals included the $516-million buyout of Magma General Insurance by DS Group and Patanjali Ayurved, and HUL’s $350-million acquisition of skincare brand Minimalist.
Bengaluru led in city-based funding, attracting 26% of the total, closely followed by Delhi at 25%. Among investors, Accel emerged as the most active venture firm, participating in 30 rounds, while Blume Ventures added seven startups to its portfolio.
LetsVenture, AngelList, and Accel were among the most active overall, whereas Venture Catalysts, 100X.VC, and Antler excelled in seed-stage deals. Peak XV Partners, Lightspeed, and Sofina were key players in early and late-stage investments.
