Synopsis
India's venture capital funding rebounded significantly in 2024, totaling $13.7 billion, a 43% increase from the previous year. The report by Bain & Company highlights a surge in deal activity and a favorable investment climate driven by policy reforms.Key Takeaways
- 43% increase in VC funding to $13.7 billion.
- 1,270 transactions recorded, a 45% rise.
- Policy reforms enhancing the startup ecosystem.
- Consumer technology led funding with $5.4 billion.
- Exit values reached $6.8 billion in 2024.
New Delhi, March 11 (NationPress) India’s venture capital (VC) landscape showcased a remarkable resurgence in 2024, achieving a total funding of $13.7 billion, which signifies a 43 percent increase from 2023, as reported by global consultancy Bain & Company on Tuesday.
Transaction activity surged with 1,270 deals recorded, representing a 45 percent rise in deal volumes. This revitalization strengthens India's status as the second-largest market for venture capital and growth funding within the Asia-Pacific region, particularly as 2024 funding levels largely align with 2023, the report highlights.
Deal volumes rose across various sizes and stages, while the average deal size remained consistent.
Small and medium deals (under $50 million), accounting for approximately 95 percent of total deals, saw an increase of about 1.4x, while deals exceeding $50 million nearly doubled, bouncing back to pre-pandemic levels as premium assets attracted investments.
Megadeals (valued over $100 million) also experienced a resurgence with a 1.6x rise in volumes as investors rallied behind high-quality firms that managed to navigate through the two-year funding slump, as per the report.
Policy reforms such as abolishing the angel tax, lowering Long-Term Capital Gains (LTCG) tax rates, eliminating the National Company Law Tribunal (NCLT) process, and streamlining Foreign Venture Capital Investor (FVCI) registrations have contributed to positive momentum for India's startup ecosystem and funding, the report indicates.
"India's evolving investment landscape demonstrates a strategic pivot toward sustainable, long-term growth — concentrating on profitability, innovation, and regulatory alignment, with policy reforms enhancing momentum and funding. Investors are increasingly favoring companies that display robust unit economics and resilience amid global macroeconomic challenges,” stated Sriwatsan Krishnan, partner at Bain & Company.
“The top ten most-funded companies captured a quarter of total VC inflows, with nine being consumer-focused, highlighting the sector’s supremacy in India's transforming startup arena," Krishnan added.
The report reveals that technology-driven sectors, including consumer technology, software, and SaaS (software-as-a-service), as well as fintech, continued to lead, obtaining over 60 percent of the total funding.
Consumer technology emerged as the leading sector, drawing in $5.4 billion in funding, more than doubling its 2023 figures, with a fourfold increase in deals over $100 million.
This significant growth was propelled by major investments in quick commerce, edtech, and B2C commerce, with firms like Zepto ($1.4 billion funding in 2024), Meesho ($275 million), and Lenskart ($200 million) securing noteworthy funding rounds.
The rapid growth in this sector underscores a clear investor preference for scalable business models with a proven path to profitability.
Funding for software and SaaS (including generative AI) maintained its momentum, rising 1.2x to $1.7 billion, driven by customer investments in development and testing tools, as well as established international go-to-market strategy playbooks, according to the report.
Traditional sectors also experienced notable growth, with BFSI and consumer/retail investments increasing by 3.5x and 2.2x, respectively.
The growth in BFSI was primarily fueled by investments in affordable housing finance and green financing initiatives, while the consumer and retail sectors attracted capital in food & beverage and fashion.
India's exit landscape also saw heightened activity, with exit values reaching $6.8 billion in 2024. Public markets played a pivotal role, accounting for three-fourths of the exit value. IPOs surged by approximately 7x as numerous venture-backed companies successfully listed, further cementing the country’s reputation as a maturing startup ecosystem.
The report concludes that India’s venture capital market is entering a phase of disciplined growth, where investors are emphasizing financial sustainability, operational excellence, and clear exit strategies.
The broader ecosystem is expected to continue evolving with a growing concentration of capital toward businesses exhibiting strong governance, scalable operations, and sustainable growth models.
