India’s tech startups raised $2.5 billion in the first quarter of 2025, a 13.64% increase from the previous quarter and an 8.7% rise from the same period last year.
The report by Tracxn reveals that this funding growth has made India the third most funded country globally. Only the US and UK rank higher. Auto tech, enterprise applications, and retail were the top sectors in Q1 2025.
Late-stage startups saw a significant increase in funding. They secured $1.8 billion, up 38.46% from Q4 2024 and 114.54% year over year.
However, total funding for seed-stage and early-stage ventures declined. Seed-stage funding reached $157 million, down 23.79% from the previous quarter and a steep 55.77% drop compared to Q1 2024.
Early-stage startups in India raised $528 million, a 23.7% decrease from Q4 2024 and a 52% decline year-over-year. While the funding environment remains dynamic, India’s startup ecosystem continues to demonstrate adaptability and growth,” said Neha Singh, Co-Founder of Tracxn.
“Sectors such as Auto Tech, Enterprise Applications, and Retail are attracting investor interest. The rise in acquisitions signals a maturing market.
India’s rising tech funding triumph
Innovation and entrepreneurship remain at the core of this ecosystem. This positions India for long-term success.”
The auto tech sector attracted $1.1 billion in Q1 2025, surpassing funding levels from both Q4 2024 and Q1 2024.
Enterprise applications companies received $650.7 million, a 21.94% increase from the previous quarter. However, it’s an 8.12% decrease year-over-year. Retail startups secured $481.5 million, up 21.6% from Q4 2024.
Though, it’s a 2.3% decrease from Q1 2024. Six companies went public in Q1 2025, including Nukleus, Maxvolt Energy, Volercars, and Harshil Agrotech. No new unicorns emerged this quarter, compared to two in Q1 2024.
There were 38 acquisitions, a 15.15% increase from the previous quarter and a 40.74% rise over Q1 2024. The report states, “The largest deal was Magma General’s $516 million acquisition by DS Group and Patanjali Ayurved.
This makes it the highest-valued acquisition of Q1 2025, surpassing Minimalist’s $350 million acquisition by HUL.”
Delhi-based tech firms accounted for 40% of all funding seen by Indian tech companies. Bengaluru followed at 21.64%. Accel, Blume Ventures, and Peak XV Partners were the top overall investors for Q1 2025.
Venture Catalysts, Unicorn India Ventures, and YourNest led seed-stage investments. Avataar Ventures and Sofina were the top late-stage investors.
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