India’s tech start-ups raised $2.5 billion in funding in Q12025, an 8.7 per cent increase from the same period last year, according to Tracxn’s Geo Quarterly India Tech Report.
According to data from market intelligence platform Tracxn, India is the third most-funded country globally after the US and the UK.
This quarter saw shifting funding dynamics in the tech ecosystem, with varied trends emerging across different stages of investment.
Late-stage witnessed total funding of $1.8 billion in Q1 2025, an increase of 114.54 per cent compared to $839 million raised in Q1 2024.
While, the seed stage saw total funding of $157 million in Q1 2025, a drop of 55.77 per cent compared to $355 million raised in Q1 2024, and the early stage saw total funding of $528 million in Q1 2025, a drop of 52 per cent compared to $1.1 billion raised in Q1 2024.
“While the funding environment remains dynamic, India’s start-up ecosystem continues to demonstrate adaptability and growth. Key sectors like auto tech, enterprise applications, and retail are attracting investor interest, and the rise in acquisitions signals a maturing market. Innovation and entrepreneurship remain at the core of this ecosystem, positioning India for long-term success,” Neha Singh, Co-Founder of Tracxn.
The report highlights that auto tech, enterprise applications and retail were the top-performing sectors in Q1 2025. Auto tech received funding of $1.1 billion, enterprise applications received $650.7 million and retail received $481.5 million in funding.
Six companies went into IPO in Q1 2025, Nukleus, Maxvolt Energy, Volercars, and Harshil Agrotech were among the companies that went public. There were no unicorns created in Q1 2025 as against 2 created in Q1 2024.
A total of 38 acquisitions took place this quarter, marking a 15.15 per cent increase from the previous quarter and a 40.74 per cent rise from 27 acquisitions in Q1 2024. The largest deal was Magma General’s $516 m acquisition by DS Group and Patanjali Ayurved, making it the highest-valued acquisition of Q1 2025, surpassing Minimalist’s $350 m acquisition by HUL.
Delhi-based tech firms accounted for 40 per cent of all funding seen by tech companies across India. This was followed by Bengaluru accounting for 21.64 per cent.
Accel, Blume Ventures and Peak XV Partners were the overall all-time top investors for Q1 2025. Venture Catalysts, Unicorn India Ventures and YourNest were the top seed-stage investors, while Avataar Ventures and Sofina were the top late-stage investors. Accel, Peak XV Partners and Vertex Ventures were the top early-stage investors this quarter.
