India saw 883 venture capital (VC) funding deals worth $8.3 billion from January to September (Q1-Q3) 2024. This marks a year-on-year (YoY) improvement of 7.3% in deal volume, while the growth in funding value stood significantly high at 52.8%, according to the latest data shared by the U.K.-based data and analytics major GlobalData.
This marks an increase from 823 VC deals in the year-ago period of Q1-Q3 2023, whereas the total disclosed funding value stood at $5.5 billion.
In the nine-month period of 2024, India also accounted for 7.2% of the total number of VC deals globally, while its share in the corresponding disclosed funding value stood at 4.5%.
Experts say the challenge that the Indian start-up ecosystem faced in raising money in 2023 seems to be “fading away” as VC funding continued to improve this year. “Going by the trend, it is evident India remains an attractive market for VC firms and now there is a shift in investors’ approach from cautiousness to cautious optimism,” says Aurojyoti Bose, lead analyst at GlobalData.
The growth in the number of big-ticket deals, valued over or equal to $100 million, also indicates optimism among VC firms regarding the Indian startup ecosystem. The data shows the number of big-ticket VC deals increased from 10 during Q1-Q3 2023 to 15 during Q1-Q3 2024.
Notable ones include $665 million and $340 million raised by Zepto in two separate funding rounds, $300 by Meesho, $216 million by PharmEasy, $210 million by PhysicsWallah, $173.5 million by OYO, and $150 million by Radiance, among others.
India, apart from being a key Asia-Pacific market standing just next to China, is also among the top five investment destinations globally for VC firms, says Bose.
With 1,36,000 startups and 99 unicorns, India ranks 4th globally in funding, behind the U.S., UK and China. “India’s tech ecosystem continues to demonstrate resilience,” said Neha Singh, co-founder Tracxn.
“The emergence of six new unicorns and a surge in IPOs with 29 tech companies going public in 2024 YTD reflects investor confidence in the ecosystem. While overall funding has slowed, late-stage investments and the increasing momentum in fintech and retail show that innovation-driven growth is still thriving in India’s startup landscape,” she said in Tracxn’s September report.
Showing a sign of recovery, companies seem upbeat this year, they are stepping up hiring, and layoffs have declined 55%. Since H1 2022, countries grappled with funding winter for four consecutive half-year periods, but 2024 shows promise. The uptick in funding is reflected in hiring, especially of freshers, and an increase in several new start-ups. There has been a 37% increase in several start-ups since last year and a 14% rise in several jobs, says Ankit Agarwal, founder and CEO of Unstop, a New Delhi-based hiring platform backed by Japan-based Mynavi and Coursera. “Of these, 53% of jobs are for freshers.”
