Indian Startups Funding Surge Reaches $375.52 Million

Indian startups experienced a significant funding surge this week, securing approximately $375.52 million across 32 companies. This included a total of 7 growth-stage deals and 22 early-stage deals, while 3 startups opted to keep their transaction details confidential. In comparison, the prior week had 23 startups raising around $137 million.

Growth-stage Deals

In the growth-stage funding arena, contactless payment solutions provider ToneTag raised $78 million in a Series B funding round led by ValueQuest S.C.A.L.E. Fund. Additionally, contract lifecycle management platform SpotDraft obtained $54 million in a Series B round from Vertex Growth Singapore and Trident Partners. Modern banking technology firm Zeta secured $50 million, bringing its valuation to $2 billion. Other growth-stage startups receiving funding this week included AI startup 75F, mobility service provider Rapido, electric bus manufacturer PMI Electro Mobility, and direct-to-consumer footwear brand JQR.

Early-stage Deals

In the early-stage segment, 22 startups collectively garnered $64.82 million. SaaS startup Lucidity topped the early-stage funding with $21 million in a Series A round. This was followed by cross-border workforce mobility platform BorderPlus, men’s sexual health brand Boldcare, and B2B manufacturing startup CapGrid Solutions, among others. Furthermore, online English tutoring app Bambinos.live, patient monitoring startup Lifesigns, and flexi-talent financial research platform Rubyworks raised undisclosed amounts.

City and Segment-wise Deal Breakdown

Bengaluru-based startups dominated the funding landscape with 15 deals, followed by startups from Delhi-NCR, Mumbai, and other locations. In terms of segments, fintech startups led with 5 deals, with SaaS, AI, and Healthtech companies following closely with 3 deals each. Other segments, including edtech, EV, and e-commerce, also secured funding.

Series-wise Funding Overview

This week, Seed funding topped the charts with 11 deals, followed by Series B and Series A funding rounds, along with pre-seed and pre-Series A deals.

Week-on-week Funding Trend

Startup funding increased dramatically by 2.7 times, reaching $375.52 million compared to approximately $136.93 million raised in the previous week. Over the past eight weeks, average funding has been around $291.21 million, with 25 deals each week.

Key Leadership Changes

This week witnessed several significant leadership appointments. Navi appointed Rajiv Naresh as CEO at Navi Technologies and Abhishek Dwivedi as CEO of Navi Finserv, while Sachin Bansal transitioned to executive chairman of Navi Group. EV manufacturer Euler Motors named Ashish Tandon as global head of customer excellence, and actor Pankaj Tripathi joined audio platform Velevet as co-founder. Additionally, Razorpay promoted Khilan Haria to Chief Product Officer.

Noteworthy departures included Peak XV’s managing partners Shailesh Lakhani and Abheek Anand, who announced their exit, along with Lizzie Chapman, co-founder of Swiffy Labs.

Mergers and Acquisitions

This week, some notable acquisitions occurred, including quick commerce platform KiranaPro acquiring Joper.app, a hyperlocal grocery delivery service, and MSys Technologies acquiring fintech company Gophers Lab.

New Fund Launches

Venture capital firm Triton announced the first close of its second fund, targeting a total of Rs 240 crore ($28 million). IXP, a Life Sciences VC supported by JV Ventures, launched its inaugural fund aimed at early-stage B2B companies, covering pre-seed to Series A stages. WTFund, led by Nikhil Kamath, introduced its second cohort, featuring 22 founders, and provides grants of up to Rs 20 lakh, along with mentorship opportunities. IPV Ideaschool has opened applications for its third accelerator program, offering Rs 1 crore in pre-seed funding to five startups and access to its ecosystem for funding, mentorship, and partnerships.

Employee Stock Ownership Plan (ESOP) Buyback

Rapido, the ride-hailing company, announced its first-ever Employee Stock Ownership Plan (ESOP) liquidation program open to present and former employees.

New Launches and Collaborations

New partnerships and launches included Exotel teaming up with Knowmax to enhance enterprise access to knowledge, Tata Elxsi and Garuda Aerospace signing a Memorandum of Understanding (MoU), Rebel Foods launching ‘QuickiES’, a rapid food delivery app, DPIIT collaborating with Rukam Capital to strengthen product startups, Gupshup introducing AI agents for improved engagement, and Pristyn Care opening its first super-speciality hospital in South Delhi. Additionally, Rapido plans to introduce a women-only bike taxi service in Karnataka.

Financial Results of the Week

Several companies reported their financial results: Info Edge-backed Truemeds crossed Rs 300 crore in gross revenue for FY24, while Nazara’s profits fell by 54% in Q3 FY25. Ola’s ride-hailing business declined by 11% in FY24 but achieved EBITDA profitability. Veranda Learning approached Rs 100 crore in revenue for Q3 FY25, and WheelsEye reduced losses by 71% to Rs 39 crore in FY24. Mamaearth parent company Honasa returned to profitability in Q3 FY25, while TBO Tek reported Rs 422 crore revenue in Q3 FY25, maintaining flat profits. Extramarks’ losses decreased by 85% to Rs 48 crore in FY24 as revenue dropped by 37%. Freshworks’ revenue reached $194.6 million in Q4, with projections of $809 million for CY25. Awfis reported Rs 318 crore revenue and Rs 15 crore profits in Q3 FY25, while Magicpin tripled its revenue to Rs 870 crore in FY24 while cutting losses. Tracxn’s profit fell by 36% in Q3 FY25 amid flat revenue, and Yatra reported a profit increase of 10X in Q3 FY25, with doubled revenue. LiquiLoans saw revenue surge 3.4X to Rs 696 crore in FY24, remaining profitable, while Nykaa’s revenue in Q3 FY25 amounted to Rs 2,267 crore, with profits soaring by 52%. EaseMyTrip generated Rs 150 crore in revenue for Q3 FY25, but profits declined, and Ranveer Allahbadia’s Monk-E neared Rs 100 crore in revenue for FY24, with profits jumping by 59%.

Potential Deals

Upcoming deals include Rapido aiming to raise Rs 250 crore in Series E funding from Prosus, Lahori in discussions for Rs 400-450 crore, Solv considering a merger with Jumbotail, and The Whole Truth seeking Rs 133.3 crore in Series C funding.

Industry News This Week

Major developments included Groww extending its lead over Zerodha in active users, with Dhan and INDmoney also gaining ground. PhonePe recorded 8 billion UPI transactions in January, regaining a spot in the top 10. Swiggy announced an additional 2% fee for restaurants, while Easebuzz received final RBI approval to function as an online payment aggregator. Zetwerk intends to file IPO draft papers within the next six months, and Tamil Nadu has prohibited online real money gaming for minors. India’s wearable market is expected to shrink in 2024, with smartwatch sales dropping by 34.4%, as reported by IDC.

Funding Weekly Recap

In summary, startup funding surged this week by 2.7 times, reaching $375.52 million compared to around $136.93 million gained the previous week. The startup funding landscape showcases significant shifts, with Groww leading the stockbroking sector supported by 13.23 million active users, claiming a 26.66% market share. UPI processed nearly 17 billion transactions valued at Rs 23.48 lakh crore in January, with PhonePe leading at 47.67% market share. B2B manufacturing unicorn Zetwerk is planning to draft IPO papers within six months to raise $400-500 million. India’s wearable device market faced its first annual decline with total shipments dropping by 11.3% year-on-year according to IDC’s tracker.