Athira Sethu
Kochi, 25 March 2025
During the first quarter of 2025, India’s technology startups raised $2.5 billion, a 13.64% quarter-on-quarter increase and an 8.7% year-on-year increase from the same period last year. The feat made India the third best-funded nation in the world after the US and the UK. The report, by market intelligence platform Tracxn, cited robust growth across industries such as auto tech, enterprise applications, and retail.
The report also indicated a change in the trends of funding, though. Late-stage startups registered a big boost in funding, while early-stage and seed-stage startups received a decrease in total funding.
Late-stage companies raised $1.8 billion, an increase of 38.46% compared to the previous quarter and a staggering 114.54% increase over Q1 2024. On the other hand, seed-stage startups witnessed a 23.79% fall from the previous quarter with a mere $157 million. Early-stage companies also declined, with their investment dropping by 23.7% from the last quarter to $528 million.
The Tracxn report also revealed that some sectors are still drawing high investor interest. Auto tech, for example, had $1.1 billion poured in Q1 2025, which was significantly greater than before.
Enterprise software earned $650.7 million, a 21.94% gain from the last quarter, while retail had $481.5 million, a 21.6% gain from the previous quarter.
The report further stated that six companies listed in Q1 2025, including Nukleus, Maxvolt Energy, and Volercars. Nevertheless, no new unicorns were formed this quarter, as opposed to Q1 2024 when two new unicorns were formed. Besides, there were 38 acquisitions in Q1 2025, a 15.15% increase compared to the last quarter and a 40.74% increase compared to Q1 2024. The biggest deal was Magma General’s acquisition by DS Group and Patanjali Ayurved for $516 million.
Delhi-located tech companies dominated the funding round, capturing 40% of the overall investment, followed by Bengaluru at 21.64%. Investors such as Accel, Blume Ventures, and Peak XV Partners were the most prominent investors for the quarter.
