VC inflow sees sharp decline; Bengaluru leads Avendus Wealth-Hurun U30 rankings
The sharp fall in venture capital funding in the first week of July was on expected lines, as the previous week saw the CRED transaction, which was a one-off large deal.
Hello,
The global AI race is accelerating, and world leaders are stepping in personally to attract the biggest tech investments. French President Emmanuel Macron and Prime Minister Narendra Modi are courting global tech CEOs to bring AI infrastructure, data centres, and billions of dollars in investment to their countries.
From Amazon’s massive AI and cloud commitment to India to France’s push for large-scale AI projects, the competition to become an AI powerhouse is intensifying.
AI’s rapid rise is also creating new risks. UK authorities are urging parents to make children’s social media accounts private, review old posts, and limit who can view photos, warning that publicly shared images can be scraped and manipulated into AI-generated child sexual abuse material. Schools have also been advised to remove identifiable student photos from websites and social media.
Back home, Bengaluru has another milestone to celebrate. The city topped the latest Avendus Wealth-Hurun India U30 List with 21 young entrepreneurs, up from just seven last year. Karnataka Minister Priyank Kharge says the jump reflects a startup ecosystem that’s becoming younger and increasingly focused on DeepTech, AI, spacetech, cybersecurity, and advanced manufacturing.
The EV sector is also seeking momentum. Union Minister HD Kumaraswamy met leading electric two-wheeler manufacturers to discuss strengthening indigenous manufacturing and building a globally competitive EV ecosystem, with industry leaders calling for continued policy support to help scale production and exports.
In today’s newsletter, we will talk about
- VC inflow sees sharp decline
- Karnataka’s deeptech, quantum computing bet
Here’s your trivia for today: What was the first iPhone model to feature a front-facing camera?
Funding
VC inflow sees sharp decline
After an unusually strong previous week driven by CRED’s $900-million fundraise, venture capital activity in the Indian startup ecosystem returned to more typical levels. Startups raised a total of $107 million across 22 deals in the first week of July, with investors backing a broad mix of businesses—from consumer brands and real estate to climate tech and AI—underscoring continued interest in diverse sectors despite the absence of mega deals.
Key takeaways:
- Indian startups raised $107 million across 22 deals, down sharply from $1.1 billion the previous week, when CRED’s $900-million round skewed overall funding figures. The largest deal this week was just $17 million.
- Investors backed a wide range of startups, including kitchenware brand The Indus Valley, managed workspace provider Incuspaze, cleantech startup BatX Energies, AI startup Kapture CX, and financial services firm Dovetail Capital, reflecting continued appetite beyond traditional technology ventures.
- Despite the weekly slowdown, startup funding has reached $6.9 billion in the first six months of 2026, indicating sustained investor confidence and a healthy pace of capital deployment this year.
ICYMI
Karnataka’s deeptech, quantum computing bet
When Dr Manjula N looks at Karnataka’s technology ambitions today, she sees them through the lens of someone who has witnessed the state's transformation firsthand. Having studied in schools across multiple districts before completing her higher education in Bengaluru, the IAS officer has seen Karnataka evolve into one of India's foremost innovation hubs.
Key takeaways:
- An officer of the 2002 batch from the Karnataka cadre, Dr Manjula has served across district administration, tourism, and municipal and infrastructure leadership.
- As Secretary to the Government of Karnataka in the Department of Electronics, Information Technology, Biotechnology and Science & Technology, she is helping shape the state’s next chapter—one centred on deep technologies.
- The Local Economy Accelerator Program—LEAP—is focused entirely beyond the Bengaluru area, she says. “With an investment of Rs 1,000 crore over five years, we want to decentralise innovation, nurture emerging tech clusters, and create opportunities across Karnataka,” she adds.
News & updates
- Cricket: Australia will bid for a record-extending seventh Women’s Twenty20 World Cup title when they face arch-rivals England in Sunday’s final at Lord’s, with the tournament’s two unbeaten teams chasing history on the biggest stage.
- Oil prices: Oil prices are falling as a US-Iran peace deal boosts supply expectations, with Brent crude slipping to around $70 a barrel and fuelling fears of a global oil glut.
What was the first iPhone model to feature a front-facing camera?
Answer: iPhone 4
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