Investment flows into India’s technology startup ecosystem slowed in 2025, even as exits and public listings showed stronger momentum.
Cumulative equity funding for Indian tech startups stood at $10.5 billion in 2025, marking a 17% year on year decline and a 4% drop from the $11 billion raised in 2023, according to a sector report. The fall comes after a modest recovery in 2024, following the funding peak of 2021 and the prolonged funding slowdown that followed.
Data from the Indian tech funding report by Tracxn shows the decline was spread across stages. Early stage funding rose by 7%, but seed funding fell 30%, while late stage investments dropped 26% compared to the previous year. There were 14 funding rounds above $100 million in 2025, down from 19 in 2024 and 16 in 2023.
Merger and acquisition activity showed mixed trends. The tech sector recorded 136 acquisitions in 2025, a 7% increase over the 127 deals seen in 2024, but an 11% decline from the 153 acquisitions completed in 2023.
IPO activity strengthened during the year. A total of 42 tech companies went public in 2025, representing a 17% increase from 36 IPOs in 2024 and a 62% rise compared to 26 listings in 2023. Key IPOs included Meesho, Aequs and Ravel. The number of new unicorns remained steady at 5, unchanged from 2024.
Neha Singh, co founder of Tracxn, said capital allocation has become more measured.
“The sustained momentum in early stage funding, rising IPO activity, and steady unicorn creation highlight a maturing ecosystem that is increasingly focused on building scalable, high quality businesses. The growth in exits and continued investor interest across core sectors such as enterprise applications, retail, and fintech show a resilient startup market.”
Enterprise applications, retail and fintech emerged as the top funded sectors, despite double digit declines. Enterprise applications attracted $2.6 billion, down 17% from 2024. Retail startups raised $2.4 billion, also a 17% drop, while fintech secured $2.2 billion, reflecting a 5% year on year decline.
Large funding rounds were led by transportation and logistics tech, environment tech and auto tech. Notable deals included Erisha E Mobility’s $1 billion Series D, Zepto’s $300 million Series H and GreenLine’s $275 million round.
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