April 12, 2025: Venture capital (VC) funding into Indian startups continued its muted trajectory during the second week of April 2025, reflecting cautious investor sentiment amid global economic uncertainty triggered by tariff wars.
According to startup funding data, Indian startups raised $209 million across 23 deals, showing only a marginal rise from the $202 million secured in the previous week. This subdued performance highlights a broader trend: VC activity in India is holding rangebound, with no significant upswings in deal size or frequency.
Indian Startup Funding: Economic Uncertainty Weighs on Venture Capital Inflow
The lingering uncertainty in global markets—particularly due to tariff disputes initiated by the United States under President Donald Trump’s trade policies—has dampened investor confidence.
Startups and investors alike are facing a “wait and watch” scenario, as no clear resolution appears imminent. The ambiguity around how international trade tensions will evolve has led to increased risk aversion, particularly for growth-stage and late-stage investments.
Juspay’s $60M Deal Offers a Temporary Boost
A significant highlight from the week startup funding was fintech startup Juspay raising $60 million, led by Kedaara Capital, with participation from SoftBank and Accel. This single transaction made up nearly 30% of the week’s total funding and helped prop up otherwise sluggish figures.
Without the Juspay deal, the total startup funding figure would have been far more modest—an indication of how dependent the ecosystem currently is on large, isolated deals to maintain momentum.
Notably, no Indian startup has raised more than $100 million in a single round over the past four weeks. This reflects growing caution from venture capitalists in deploying capital at scale in the current macroeconomic climate.
Distress M&A: Signs of Ecosystem Stress
Alongside modest startup funding activity, the Indian startup ecosystem is witnessing a surge in mergers and acquisitions (M&A) that signal potential distress.
In a major move, Delhivery acquired Ecom Express, while Good Glamm Group offloaded MissMalini Entertainment, a previously high-valued media asset. Sources suggest that both deals were valued well below prior expectations, highlighting how startups are increasingly forced into strategic sales to maintain cash flow or reduce operational overhead.
Global Capital Inflows: A Silver Lining
In a welcome development, U.S.-based VC firm Expert Dojo announced a $100 million global fund, with $15 million earmarked for Indian startups. This signals that despite prevailing economic pressures, international investors still see long-term potential in India’s digital economy.
Adding to the optimism in Indian Startup Funding, quick-commerce unicorn Zepto reported it is on track to reach $4 billion in annualised gross order value (GOV) — a 4x YoY growth and 30% increase since January, showing that demand-side momentum remains robust.
Key Deals This Week
- Juspay raised $60 million from Kedaara Capital, SoftBank, and Accel.
- Easebuzz, another fintech player, secured $30 million from Bessemer Venture Partners, 8i Ventures, and Varanium Capital.
- Eloelo, a rising social gaming platform, received ₹114 crore (~$13.5 million) from Play Ventures, Gameskraft Technologies, WestBridge Ventures, and Kalaari Capital.
- Xindus, a logistics startup, raised $10 million from 3one4 Capital, Orios Venture Partners, Shastra VC, and Caret Capital.
- Asha Ventures was funded with $10 million from British International Investment (BII).
- PARÉ Innovations closed an $8.5 million round led by Advenza Global.
A Market in Flux
The Indian startup ecosystem remains fundamentally strong, but short-term volatility driven by macroeconomic shocks and geopolitical uncertainty is influencing capital flow patterns.
With no immediate end in sight to the U.S.-China tariff standoff, Indian startups may need to recalibrate their fundraising strategies, focusing more on sustainable growth and strategic consolidation.
