The Indian startup ecosystem has the ability to adapt and persevere amid challenges. The same was witnessed in 2024. It was a year of a mixed bag as a slight decline in funding was noticed amid several success stories.
A latest report by Tracxn reveals that the Indian startups raised $30.4 billion in 2024. However, the figure was less compared to that of $32.5 billion collected in 2023. The drop was a matter of concern for many, but it is worth taking a note that India added several new unicorns in 2024. Some of the new unicorns in the year are Rapido, Ather, Perfios, Porter and Money View.
One encouraging trend was the rise in early-stage investments. Seed and Series A funding rounds gained momentum as investors placed their bets on promising ideas equipped with long-term potential. The shift is a good gesture that investors are looking beyond short-term returns. They are in fact keen on supporting businesses having strong fundamentals.
Government removed angel tax and it was a welcome step that provided relief to startups and investors. However, high operational costs, infrastructure gaps, compliance hurdles and more such challenges remained significant barriers.
There has been an inspiring rise in entrepreneurs from Tier 2 and Tier 3 towns. The founders are coming up with some fresh ideas to solve hyperlocal in areas that were previously overlooked.
However, the funding space become more cautious despite the successes. Many deals were focused on sustainability and profitability. They avoided chasing valuations.
The year 2025 holds immense promise for startups and particularly in segments like AI, machine learning and blockchain. Deep Tech, Electric Vehicles and Clean Tech are expected to attract more investments than other startups.
