July 28, 2025: India startups capital inflow has entered a phase of striking predictability, flatlining at a level far below its peaks. As July 2025 draws to a close, a subdued spirit hangs over the country’s once-celebrated venture capital landscape.
Data from the fourth week of July reveals a total infusion of $120M across 21 startup deals, closely mirroring the $124M recorded in the prior week and cementing a “steady, but stagnant” weekly trend.
What is striking is not the steadiness, it’s the underwhelming numbers reflecting a cautious, skeptical investment climate. In prior quarters, Indian startups routinely attracted $200M or more weekly; by contrast, July’s new norm hovers near the $100M mark, exposing visible investor restraint and an absence of blockbuster deals.
- Early-stage and late-stage investments each attracted $52M, signaling a rare balance but little overall momentum.
- Growth-stage startups fared much worse, raising only $11M in the week, evidence that larger, later rounds remain elusive.
This funding pattern reveals significant hesitancy among investors, particularly for scaling companies. Mega-rounds and late-stage deals, often essential for ecosystem vitality, remain scarce. Artificial intelligence (AI) persists as the one clear investment bright spot, benefiting from global buzz and government backing. But outside AI, most sectors witnessed muted enthusiasm.
India startups capital deals : Spotlight on Deep Tech and Retail
Netrasemi (Semiconductors): Raised ₹107Cr ($12.3M), one of the largest chip design rounds in the country, supported by the government’s DLI scheme and private investors like Zoho Corp and Unicorn India Ventures.
SuperK (Retail): Locked ₹100Cr ($11.5M), underlining investor interest in next-gen retail models.
Kluisz.ai (Deeptech/AI): Secured $9.6M, highlighting ongoing appetite for high-impact AI ventures.
Additional notable raises: EduFund ($6M), Enlite (infra-tech, $5.3M), Escape Plan (travel/lifestyle, $5M).
Macro Perspective and Investor Sentiment
A broader lens shows this stagnation is not isolated. H1 2025 startup funding in India reached $4.8B, down 25% versus a year ago, with a pronounced drop in late- and growth-stage rounds despite India’s resilience overall and continued pipeline of early-stage deals. This signals a drift towards disciplined capital allocation and operational profitability rather than chasing breakneck growth.
India’s marked absence of speculative “bubbles” or hype-driven investing is evident. The only mild exception: AI, where deal volumes and ticket sizes are trending upwards, buoyed by schemes like the IndiaAI Mission and significant VC interest.
With macroeconomic uncertainties and no unifying investment thesis beyond AI, the coming weeks are unlikely to deliver a dramatic funding rebound. Ecosystem leaders suggest this disciplined approach, while curbing exuberance, could ultimately yield healthier, more sustainable growth in the next cycle.
