(MENAFN- KNN India) New Delhi, Mar 26 (KNN)
Funding for Indian start-ups took a hit in the first quarter of 2024, dipping 29 per cent year-on-year to USD 1.6 billion amidst economic fluctuations, according to a report by market research firm Tracxn.
The decline was even steeper on a sequential basis, with funding falling 20 per cent from the previous quarter's USD 2 billion.
Despite the funding slump, India managed to secure the fourth-highest position globally in terms of funds raised in Q1, trailing behind the United States, China, and the United Kingdom.
This downturn comes after investments in India's start-up ecosystem had grown for three consecutive quarters in 2023.
The report highlights a significant 46 per cent drop in late-stage funding, although early-stage funding saw a 28 per cent increase.
Notable start-ups that raised substantial amounts in Q1 include Shadowfax, Credit Saison, Capillary, Rentomojo, and Captain Fresh, with the former two receiving over USD 100 million collectively.
Amid the funding slowdown, India's tech start-up ecosystem welcomed two new unicorns including fintech firm Perfios and artificial intelligence specialist Ola Krutrim.
Neha Singh, Co-founder, Tracxn, expressed confidence in India's resilient tech start-up ecosystem, stating, "Despite the funding slowdown and economic fluctuations, India's tech start-up ecosystem is still one of the top-performing tech ecosystems globally.”
Singh emphasised,“Even with the slowdown seen in this quarter, we anticipate the bounce back quickly, propelled by government initiatives and a large consumer base comprising the world's largest young population.”
“India's strong tech ecosystem and demographic advantages promise a bright future and solidify its position as a global tech leader," she further added.
The report further revealed that retail, fintech, and enterprise applications were the top-funded sectors in Q1. While retail received USD 494 million, marking a 34 per cent decline from the previous quarter, enterprise applications and fintech saw substantial growth of 48 per cent, securing USD 448 million and USD 429 million, respectively.
Geographically, Bengaluru emerged as the leader in total funds raised during Q1, followed by Mumbai and Noida.
(KNN Bureau)
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