December 21, 2024: VC Funding in Indian startups experienced a steep drop in the third week of December, with only $135 million raised across 19 deals. This marks a significant decline compared to the previous week’s $779 million—a drop of over 80%. This trend is not unusual, as the end-of-year period generally sees fewer large-value transactions.
Impact of Year-End Slowdown
The slowdown in funding is largely attributed to the seasonal dip in VC activity, which is expected to continue throughout the final days of December. Despite this, the Indian startup ecosystem has demonstrated resilience, signaling a more optimistic outlook for 2025.
Although funding levels for 2024 will be slightly higher than last year, they are not expected to be a game-changer. Nonetheless, the foundation is being laid for a more robust funding environment next year.
Indian Startups Raise $135M Across 19 Deals in December 2024
This week saw a couple of exciting developments in the Indian startup landscape:
- Rebel Foods raised an undisclosed sum from KKR, a deal that marks a significant milestone for the food tech sector in India.
- Zetwerk, a contract manufacturing giant, secured $70 million from a consortium of investors including Khosla Ventures, Baillie Gifford, and Greenoaks Capital.
- MobiKwik, a fintech player, made waves with a stellar listing, capping off a year full of IPO activity in India. This successful listing could set the stage for more startups going public in 2025.
Sector Trends to Watch
The coming year is likely to see a resurgence of large deals, with artificial intelligence (AI) and Generative AI (GenAI) startups continuing to attract investor interest.
The next few months will likely set the stage for more prominent funding rounds and IPOs, especially in high-growth sectors like fintech, SaaS, and electric vehicles (EV).
VC Funding in Indian Startups Bounce Back; AI Startups To Dominate Funding in 2025
- Veefin Group of Companies raised ₹136 crore (~$16 million) in a recent round to further expand its operations.
- Zingbus, an EV startup, attracted $9 million from bp Ventures to scale its electric bus services across India.
- Bizom, a SaaS platform, secured $12 million from IndiaMART, Pavestone, and family offices, reinforcing the SaaS sector’s appeal.
Looking Ahead
The Indian startup ecosystem is poised for an upswing in 2025, with increased focus on AI-driven innovation and public listings. The steady return of large investments is expected to fuel optimism, providing a solid foundation for startups aiming to scale globally.
