Indian startups raised $6.9 billion in 409 funding rounds during April-June 2022, which was down by 33 per cent as compared with $10.3 billion mopped up in the previous quarter. Startup fundraising also declined on a year-on-year (YoY) basis from $10.1 billion, according to Tracxn Geo Quarterly Report: India Tech Q2 2022.
During the March 2022 quarter, the top startups in fundraising include VerSe ($805M- Series J), Delhivery ($304M- Series J), and udaan ($275M- Series D), followed by ShareChat ($255M- Series G) and upGrad ($225M- Series F).
The Tracxn report said the fall in fundraising during the June 2022 quarter has led to a consensus among market players of a ‘winter of funding’ or a downturn in investors’ confidence and sentiments towards funding startups. Funding winter is a result of the market slowdown and economic volatility based on the current macroeconomic conditions and geopolitical situation intensifying inflation, interest rates, and commodity prices.
Abhishek Goyal, co-founder of Tracxn, said, “Though investors are a little wary due to the current environment it hasn’t dampened the investment spirit of the community. They have become more decisive about the startups they want to nurture and are focusing extensively from a long-term gain perspective. Our in-depth monitoring of the Indian startup space is compiled into a quarterly report to not only track the progress of VC and PE investments, but to also provide insights on emerging practice areas.”
Neha Singh, co-founder of Tracxn, said, “The Tracxn report is a quarterly overview of the entire Indian startup ecosystem. It taps the journeys of various startups and institutional investors’ growth and successes. Through this report, we aim to give industry stakeholders key insights into the ecosystem that would help in business decision making backed by extensive market intelligence and thorough research and data analysis.”
Meanwhile, according to data from Venture Intelligence, about USD 12 billion was invested in growth and early-stage companies between January and April this year, compared with USD 11.2 billion pumped in during the corresponding period last year.
Interestingly, the data showed that the deals involving funding of USD 100 million and more are also higher this year as compared with last year. About 33 companies raised funding of USD 100 million or more during January-April 2022, while the number was 29 during the same period last year.
Also, another data from Venture Intelligence showed that only 3.5 per cent of the startups raising $100 million or above during January-June 2022 were profitable as compared with 29.2 per cent in the year-ago period.
According to the data from Venture Intelligence, a total of 57 companies in India raised funding of $100 million or more during January-June 2022 as against 48 such firms during the corresponding period last year. Interestingly, it also showed that the overall funding for the Indian start-ups this year is almost the same as last year, showing shrinking deal size.
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