SUMMARY
Indian startups raised $868 Mn across 90 deals in April 2024, up 15% from $754 Mn funding raised in March via 63 deals
However, funding declined 2% in April 2024 from $888 Mn in the year-ago and 66% from $1.52 Bn raised in April 2022
Seed and growth stage startups registered a year-on-year increase in funding in April, but late stage funding plummeted 50%
Continuing to show signs of revival in 2024 after a harsh funding winter, Indian startup funding grew in the month of April. Between April 1 and April 26, Indian startups raised $868 Mn, up 15% from $754 Mn in March. This is despite the funding hitting a five-year low of $512 Mn in January this year.
Meanwhile, the deal count also grew to 90 in April 2024 from 63 in the preceding month.
However, on a YoY basis, startup funding declined 2% in April 2024 from $888 Mn in the year-ago month, while it was 66% lower than the $1.52 Bn raised by Indian startups in April 2022.
It is pertinent to mention that the trend of YoY decline in funding was more pronounced in the first quarter of 2024. The funding raised by Indian startups slumped 33% YoY to $2 Bn in the March quarter, hitting a seven-year low.
Seed & Growth Stage Investments On The Up
Seed and growth stage startups registered a YoY increase in funding in April after a marginal decline last month. Seed stage startups netted $178 Mn across 46 deals last month, a 286% increase from $46 Mn raised a year ago across 25 deals.
The increase in seed funding was partially due to a $26 Mn cheque secured by former Zomato senior executive Mohit Gupta and Myntra’s founder Mukesh Bansal for their new omnichannel fashion startup Lyskraft.
Meanwhile, growth stage startup funding also jumped 78% YoY to $332 Mn last month. The lone mega funding of the month came in for growth stage startup, iBUS. The digital infrastructure solutions company raised $200 Mn in strategic funding from the National Investment and Infrastructure Fund (NIIF).
Besides, the month also saw growth stage enterprise tech startup ProcMart bag $30 Mn in a Series B funding round led by Fundamentum Partnership, a venture capital firm cofounded by Nandan Nilekani and Sanjeev Aggarwal, along with Edelweiss Discovery Fund.
However, the situation continued to remain grim for late stage funding. Late stage startups only managed to raise $314 Mn across 13 deals in April, a decline of 50%.
Enterprise Tech Startups Investors’ Favourite
Bolstered by iBUS’ mega funding, the enterprise tech sector attracted the maximum funding last month.
While startups in the sector cumulatively secured $305 Mn across 21 deals, the fintech sector, which was at the top spot in the first quarter of 2024, slipped to the second position. Fintech startups bagged $211 Mn across 12 deals in April. This included deals like Northern Arc’s $80 Mn fundraise and Altum Credo’s $40 Mn funding round.
Buoyed by IPO-bound Ola Electric’s $50 Mn debt funding as well as a similar funding round for GPS Renewables, cleantech emerged as the third-highest funded sector in April.
Mumbai Loses Third Spot To Chennai
Along with a shakeup in the funding landscape at a sectoral level, there were some changes in funding trends geographically.
Startups headquartered in Bengaluru continued to be the darling of investors, cumulatively bagging $432 Mn across 28 deals in April. Delhi NCR retained its second position with funding of $135 Mn.
Meanwhile, Chennai knocked off Mumbai from the third spot, with startups based in the Tamil Nadu capital bagging $87 Mn last month. In comparison, startups in Mumbai secured $66 Mn last month.
During the first three months of 2024, Mumbai was the third-highest funded startup hub. Startups in the financial capital of the country raised $351 Mn across 42 deals in Q1. Bengaluru was at the top spot with $853 Mn funding across 63 deals, while Delhi NCR startups netted $441 Mn across 48 deals in the March quarter.
