India has emerged as the third-largest recipient of tech startup funding globally in the first half of 2025, outpacing Germany and Israel and standing behind only the United States and the United Kingdom, according to the latest India Tech Semi-Annual Funding report by market intelligence platform Tracxn.
Despite a broader investment slowdown, Indian startups raised $4.8 billion between January and June 2025. This marks a 25% drop from $6.4 billion in the same period last year and a 19% decline from $5.9 billion in the second half of 2024. The number of unicorns created also fell, with only two new unicorns emerging in H1 2025, down from three a year ago.
Tracxn co-founder Neha Singh said that while funding levels have dipped, India’s tech ecosystem continues to mature. “There is strong investor conviction in sectors that address deep structural challenges such as transportation, retail, and enterprise tech,” she said, adding that quality IPOs and notable acquisitions reflect long-term value creation in the Indian startup landscape.
Funding Falls Across All Stages, but Big Deals Continue
The funding downturn was visible across all investment stages. Seed-stage funding dropped to $452 million, a 23% decline from H2 2024 and 44% lower than H1 2024. Early-stage funding fell to $1.6 billion—6% lower than the previous half-year and 16% down year-on-year. Late-stage deals amounted to $2.7 billion, a 25% fall from H2 2024 and 27% below the year-ago period.
Nevertheless, large-ticket funding deals persisted. Five startups raised over $100 million during H1 2025, although this was down from nine in H2 2024 and ten in H1 2024. Among them were Erisha E Mobility with a $1 billion Series D round, GreenLine with $275 million in Series A, and Infra.Market with $222 million in Series F. Other significant rounds were seen in companies like Spinny and Darwinbox. Most of these large rounds came from the transportation, logistics, retail, and construction tech sectors.
Sector Trends: Transport and Retail Lead the Way
Among the sectors, Transportation and Logistics Tech showed the strongest recovery, raising $1.6 billion—a 104% increase from H2 2024 and 54% higher than the same period last year. The Retail Tech sector secured $1.2 billion, marking a 25% rise from H2 2024, though still 32% lower than H1 2024. Meanwhile, Enterprise Applications attracted $1.1 billion, showing declines of 21% and 26% from the previous half-year and year-ago period respectively.
IPOs Slow Down, But Acquisitions Rise Sharply
Public listings slowed in the first six months of 2025. Just 12 Indian startups went public during this period, compared to 21 in H1 2024. Some of the notable IPOs included Ather Energy, Tankup, SS Innovations International, and Infonative Solutions.
However, startup acquisitions surged, with 73 deals recorded, up from 54 in H1 2024. The biggest acquisition was Magma General Insurance, acquired by DS Group and Patanjali Ayurved for $516 million. Another significant deal saw HUL acquire skincare brand Minimalist for $350 million.
Bengaluru and Delhi Lead in Startup Capital
Geographically, Bengaluru emerged as the top city, contributing to 26% of the total startup funding in H1 2025. It was closely followed by Delhi, which accounted for 25% of the overall investments, further reinforcing their status as India’s startup hubs.
Investor Landscape: Accel Tops Global Deals
In terms of investor activity, Accel (U.S.) led globally with 30 investment rounds. On the domestic front, Blume Ventures added seven new startups to its portfolio.
At the seed stage, the most active investors were Venture Catalysts, 100X.VC, and Antler. For early-stage investments, key players included Peak XV Partners, Accel, and Lightspeed Venture Partners. Late-stage funding was driven by investors such as Sofina, Premji Invest, and the SoftBank Vision Fund.
Resilient Despite Headwinds
India’s position ahead of Germany and Israel in global startup funding rankings underlines the resilience of its tech ecosystem, even amid a broader funding correction. With continued interest in core sectors and a healthy pace of exits through acquisitions, the Indian startup landscape remains a crucial player in the global innovation economy.
