Did India’s Listed Startups Secure Over $5 Billion from Public Markets in FY25?
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Synopsis
In FY25, Indian startups raised a staggering $5.3 billion through public markets, marking a significant shift in funding dynamics. This report reveals the challenges and triumphs faced by these companies amid economic fluctuations, highlighting their maturation in the public arena.
Key Takeaways
- Venture-backed Indian startups raised over $5.3 billion in FY25 from public markets.
- Public markets have become a dominant source of growth capital.
- FY25 marked a significant maturation of India’s startup listings.
- Mutual fund participation in startups increased significantly.
- Foreign investors returned strongly in Q4 of FY25.
New Delhi, July 21 (NationPress) Venture-backed Indian startups successfully raised more than Rs 44,000 crore ($5.3 billion) in FY25 through public markets, leveraging initial public offerings (IPOs), follow-on public offerings (FPOs), and qualified institutional placements (QIPs), according to a report released on Monday.
The public markets have surpassed private capital in late-stage fundraising, confirming their status as the primary source of growth capital, per the Rainmaker Group's 'RainGauge Index FY25 Annual Report'.
Fiscal Year 2025 also represented the first complete market cycle for India’s startup listings, following an exuberant IPO phase in 2021–22, significant corrections in 2023, and a period of rationalization in 2024.
“This all played out against the backdrop of a cyclical economic downturn in India during FY25, which led many consumer-facing businesses to face margin pressures and declining revenue growth,” the report noted.
The fiscal year also witnessed a secondary exit exceeding Rs 20,000 crore as private equity and venture capital investors realized early profits via block transactions.
“FY25 not only challenged India’s startup listings but also fostered their maturation,” stated Kashyap Chanchani, Managing Partner at The Rainmaker Group.
The public market has emerged as the favored arena for India’s standout companies. We’ve experienced the complete journey - from the IPO frenzy to the valuation slump, and now a definitive re-rating driven by fundamentals, Chanchani added.
This financial year also saw notable structural shifts.
Moreover, participation from mutual funds surged, with average holdings in RainGauge Index companies, a curated list of listed startups by Rainmaker Group, rising from 10 percent in March 2024 to 14 percent in March 2025, according to the report.
Despite the initial corrections and record foreign institutional investor outflows of over Rs 78,000 crore in the first quarter of FY25, foreign investors made a strong comeback in Q4, driven by expectations of interest rate cuts and favorable macroeconomic indicators in India, the report highlighted.
The Rainmaker Group is a prominent investment bank in India, specializing exclusively in private markets.
Point of View
I view this report as a testament to India's evolving startup scene. The significant capital raised in FY25 reflects not only resilience but also a maturing market that is adapting to both challenges and opportunities. It underscores the importance of public markets in fostering innovation and growth within the country.
NationPress
21/07/2025
Frequently Asked Questions
How much did Indian startups raise in FY25?
Venture-backed Indian startups raised over Rs 44,000 crore ($5.3 billion) in FY25 from public markets.
What are the primary funding methods used by startups?
Startups utilized initial public offerings (IPOs), follow-on public offerings (FPOs), and qualified institutional placements (QIPs) for funding.
How did the public market perform compared to private capital?
Public markets surpassed private capital in late-stage fundraising, becoming the main source of growth capital.
What economic factors influenced the startup environment in FY25?
A cyclical economic slowdown impacted consumer-facing companies in FY25, leading to margin compression and weak revenue growth.
What changes were observed in mutual fund participation?
Mutual fund holdings in RainGauge Index companies increased from 10 percent in March 2024 to 14 percent in March 2025.
