VC funding for Indian startups zoom 43% in H1 2024: Report

Indian startups have secured $6.3 billion in funding through 672 venture capital (VC) deals from January to July 2024 (H1 2024), a 43 per cent year-on-year (YoY) increase, a recent report stated.

The surge in funding comes despite a global investment environment that has been cautious, with a mere 1.2 per cent rise in deal volume around the world.

The strong performance of domestic startups indicates growing investor confidence in the country’s market potential, as highlighted by GlobalData.

In the same period last year, India saw 664 VC deals with a disclosed funding value of $4.4 billion, as per an analysis of GlobalData’s Deals Database. This year’s increase in funding value, despite the modest growth in deal numbers, has been driven largely by substantial transactions. Noteworthy deals include $665 million raised by quick commerce firm Zepto, $300 million by e-commerce startup Meesho, and $216 million by online pharmacy PharmEasy.

According to Bose, a representative from GlobalData, the rise in funding is a reflection of big-ticket deals that have boosted overall figures. Moreover, Indian companies are experiencing a strong recovery in overseas fundraising in 2024, following a slow year in 2023. This revival is largely attributed to a growing demand for high-yield bonds from international investors, amid improving liquidity conditions.
In a related development, DMI Finance is reportedly set to raise funds from MUFG at a valuation of $3 billion.

India accounted for 7 per cent of the total VC deals announced globally in the first seven months of 2024, with the country’s share of the disclosed funding value standing at 4.3 per cent.

“India is not only a key market in the Asia-Pacific region, second only to China, but also ranks among the top five globally in terms of both VC deal volume and value,” Bose added.

The country continues to be a pivotal market for VC activity, bolstered by a strong pipeline of promising startups that attract substantial capital, despite the prevailing global economic uncertainties. This trend underscores India’s resilience and growth in the global venture ecosystem, even amid a cautious investment climate, according to Bose.