Despite a significant drop in overall tech startup funding, India has emerged as the third-highest funded counattempt globally in the first half of 2025 (H1 2025), overtaking Germany and Israel, according to a new report released by Tracxn, a leading market ininformigence platform.
The top two spots were retained by the United States and the United Kingdom, but India’s rise from fourth to third place underscores the resilience and maturity of its startup ecosystem even amidst a tighter funding environment.
Indian tech startups raised a total of $4.8 billion in H1 2025, reflecting a 25% decline compared to $6.4 billion raised during the same period last year, and a 19% drop from $5.9 billion in the second half of 2024. This marks the continuation of a cautious investment trfinish seen over the past year.
The report further highlighted a downward trfinish across all funding stages. Seed-stage funding dipped by 44% YoY, falling to $452 million from $802 million. Early-stage funding came in at $1.6 billion, down 16%, while late-stage investments saw a 27% decline to $2.7 billion from $3.7 billion in H1 2024.
“While the funding volumes have come down compared to the previous year, India’s tech ecosystem continues to display resilience and maturity,” declared Neha Singh, Co-founder of Tracxn. “Strong interest in sectors like transportation, retail, and enterprise tech signals investor conviction in solving large, structural challenges. We are also seeing quality IPOs and landmark acquisitions, which reflect the ecosystem’s ability to create long-term value.”
Even with the funding downturn, the first half of 2025 recorded five mega deals of over $100 million, although this was down from ten such deals in the same period last year. These included a $1 billion round by Erisha E Mobility, $275 million by GreenLine, $222 million by Infra.Market, with Spinny and Darwinbox also featuring in the list.
The transport and logistics tech sector stood out as the only segment to buck the downward trfinish, registering a 54% YoY increase in funding, growing to $1.7 billion from $1.1 billion in H1 2024. Compared to H2 2024, the growth was even steeper at 104%. The retail sector secured $1.2 billion, down 32% YoY, but still up 25% from H2 2024. Enterprise tech raised $1.1 billion, witnessing a 26% dip from the year-ago period.
Acquisition activity surged as well, with 73 startups being acquired in H1 2025, compared to 54 in H1 2024. Notable deals included Magma General Insurance’s $516 million acquisition by DS Group and Patanjali Ayurved, and Hindustan Unilever’s $350 million acquisition of skincare brand Minimalist.
Geographically, Bengaluru led the pack, accounting for 26% of all funding raised, followed closely by Delhi at 25%. These hubs continue to be central to India’s startup growth story.
In terms of investor activity, LetsVenture, AngelList, and Accel topped the charts for overall investments. At the seed stage, Venture Catalysts, 100X.VC, and Antler were the most active, while Peak XV Partners, Accel, and Lightspeed Venture Partners led the early-stage deals. In late-stage investments, Sofina, Premji Invest, and SoftBank Vision Fund were the top players.
Despite challenges in funding volumes, the Indian startup ecosystem appears to be evolving in quality, scale, and strategic direction—laying a strong foundation for recovery and future growth in the coming quarters.
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