Startup Funding In India Reduced By 33% Due To Global Slowdown; Only $6.9 Billion Invested In 90 Days

Total funding raised by Indian startups in the June quarter fell 33 percent sequentially to $6.9 billion.

It was not just lower than the $10.3 billion logged between January and March 2022, but also saw a decline compared to the same quarter of the previous year ($10.1 billion in Q2 of 2021).

Funding winter

The funding seems to have cooled off the previous high witnessed in Q3 2021.

This falls in line with a funding ‘winter’ being observed currently, which is expected to continue for another year.

There is a major consensus amongst market players of a downturn in investors’ confidence and sentiments towards funding startups.

This trend can be attributed to market slowdown and economic volatility based on the current macroeconomic and geopolitical conditions.

Top funded startups

Indian startups raised $6.9 billion in Q2 of 2022 (April-June) in 409 funding rounds.

The top startups being: 

• VerSe ($805 million – Series J)
• ?Delhivery? ($304 million- Series J)
• ?Udaan? ($275 million- Series D)
• ShareChat? ($255 million- Series G) 
• ?upGrad? ($225 million- Series F)

New unicorns

121 new startups closed their first funding rounds, four startups turned unicorns, 62 startups got acquired and 5 launched their IPOs.

The four startups that turned unicorns are ?LeadSquared?, ?Purplle?, ?Physics Wallah?, and ?Open.

With these additions, the total valuation of unicorns grew to $31.8 billion in the past quarter (Q2 2022).

Approaching unicorn status

Three startups became “soonicorn” or are on the verge of becoming a unicorn. 

They are GOAT Brand Labs, Fashinza, and Itilite with fundraises of $88 million, $135 million, and $47.2 million respectively.

IPOs

eMudhra, Delhivery, Handicrafts village, Eighty Jewellers, and Veranda Learning Solutions filed for IPOs

Acquisitions

Blinkit (By Zomato), Whiteteak (By Asian Paints), and MyHQ (By ANAROCK) were the top acquisitions

The third quarter of last year was a rich period, with investments grossing $15 billion in funding rounds which hasn’t been surpassed in recent times.

Top cities, sectors

Bengaluru, Delhi, and Mumbai attracted the maximum investments in the country. 

The top sectors that attracted the maximum funding during the period were social platforms, internet first media, payments, business-to-business ecommerce, and ecommerce enablers.