India logs weak tech funding in H1 2024: Report
Startup funding pattern improved across the board from the second half of 2023 as investors continued to thaw out of the long winter.
Funding in the Indian tech startup ecosystem went down 13% to $4.1 billion during the first half (H1) of 2024 compared with $4.8 billion raised during the same period a year ago, according to India Tech Semi-Annual Funding Report H1 2024 by .
However, the number was 4% higher from the second half (H2) of 2023, which recorded funding deals of $3.96 billion.
The report said that retail, enterprise applications and fintech were the top-performing sectors in H1 2024. Funding in the retail sector increased by 32%, reaching $1.63 billion in H1 2024 compared with $1.23 billion in H1 2023.
However, investments dropped in the fintech space by 50% from $1.45 billion in H1 2023 to $726 million in H1 2024. The enterprise application sector raised $933 million in H1 2024, a 10% decrease from the $1.04 billion raised in H1 2023.
Tech funding patterns across different stages were generally lower compared with last year, with early-stage startups seeing the highest fall at 28% lower funding in H1 2024, followed by seed stage (17.3% lower) and late-stage at 1.3% lower.
The period saw eight funding rounds that surpassed the $100 million mark, including Flipkart’s $350 million Series J round led by Google, Apollo 247’s $297 million PE round, and Meesho’s $275 million Series F round.
During the last six months, funding activities in all stages had improved or were stable from the second half of 2023.
Neha Singh, Co-founder of Tracxn, said, “Despite four consecutive half-year periods of declining funding since H1 2022, we are now showing signs of stabilisation, going upward."
In H1 2024, three unicorns emerged—a notable rise H1 2023 when there was a dearth of new billion-dollar companies. Also, startups making their Indian market debut increased to 17 from six during the same period.
Acquisitions in the Indian startup ecosystem saw a decline, with 43 acquisitions in H1 2024, compared with 75 acquisitions in H1 2023.
Bengaluru startups logged the highest funding, followed by Mumbai and Hyderabad. India remained the fourth-highest funded country globally in the tech startup landscape, right behind the United States, the UK, and China.
Edited by Suman Singh