India’s startup funding momentum cooled sharply in the week ending December 27, with 11 startups raising a total of $95.54 million, a steep 74% decline compared to the $363.9 million raised by 31 startups in the previous week. The slowdown highlights growing investor caution as the year draws to a close, even as select growth-stage and early-stage companies continue to attract capital.
Of the total deals this week, four were growth-stage, five early-stage, while three startups chose not to disclose funding details.
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Credits: Entrackr
Growth-Stage Deals Dominate Despite Overall Dip
Growth and late-stage funding accounted for the lion’s share of capital raised, touching $73 million during the week. Leading the pack was CoreEL Technologies, which raised $30 million in a Series B round led by ValueQuest Scale Fund, with participation from 360 ONE Asset. The funding underscores investor interest in deeptech and electronics manufacturing platforms with defence and strategic applications.
Dugar Finance followed with $18 million in debt funding, backed by Switzerland-based Symbiotics and Indian banks, highlighting sustained appetite for structured credit deals. Meanwhile, PlasmaGen Biosciences raised ₹150 crore, led by ViNS Bioproducts along with HNIs, family offices, pharma entrepreneurs, and existing investors—signalling confidence in India’s growing biotech ecosystem.
Quick service restaurant chain Wow! Momo also secured ₹75 crore from Singularity AMC, reinforcing the continued investor belief in scalable consumer food brands with strong unit economics.
Early-Stage Funding Remains Selective
Early-stage startups collectively raised around $22.5 million across five deals, reflecting cautious optimism rather than exuberance. PowerUp Money led this segment, raising $12 million in a Series A round from Peak XV Partners. The deal points to sustained interest in fintech platforms offering differentiated value propositions in personal finance.
Other early-stage fundraises during the week included Prosperr.io, Naxatra Labs, LokSuvidha Finance, and Entuple E-Mobility, spanning sectors such as fintech, deeptech, and mobility.
Additionally, MagicDecor, Supply6, and Quintrans announced fresh funding but did not disclose the amounts, indicating quieter capital inflows beneath the headline numbers.
Bengaluru Leads as Fintech Tops Sectoral Charts
On a city-wise basis, Bengaluru continued to dominate India’s startup funding landscape, accounting for six deals. Chennai, Ahmedabad, Nagpur, Mumbai, and Pune each recorded one deal, reflecting a geographically diverse, though Bengaluru-centric, funding environment.
Sector-wise, fintech startups led with three deals, followed by deeptech with two deals. Other sectors attracting capital included foodtech, AI, spacetech, biotech, mobility, decor, and e-commerce, highlighting the breadth of India’s startup ecosystem even in a slower funding week.
Seed Rounds Lead Series-Wise Activity
In terms of funding stages, seed rounds topped the charts with four deals, followed by Series A and Series D with two deals each. Series F and pre-Series B rounds also saw activity, indicating investor willingness to back both early traction and scaled business models selectively.
Fund Launches, M&A, and Key Corporate Moves
Beyond funding, the week saw notable ecosystem developments. Anicut Capital closed Grand Anicut Fund IV at ₹1,275 crore ($142 million), surpassing its initial target, to back startups across consumer, SaaS, manufacturing, hospitality, and engineering services. Meanwhile, Nikhil Kamath and Kishore Biyani jointly launched The Foundery, a residential startup launchpad focused on building early-stage Indian ventures.
On the M&A front, FirstCry parent Brainbees Solutions acquired K.A. Enterprises (Hygiene), Livspace bought Abby Lighting, and telematics startup Cautio acquired BYTES to strengthen two-wheeler safety solutions.
Layoffs, Buybacks, and Financial Highlights
Employee liquidity remained in focus as Dhan completed an ESOP buyback worth nearly ₹50 crore, benefiting around 180 employees. On the flip side, Yellow.ai laid off over 100 employees, impacting nearly 30% of its workforce, as it pivots toward greater AI-led automation.
A Cautious Close to the Year
While weekly funding has dipped sharply, the eight-week average stands at $243.39 million across 25 deals, suggesting that investor interest hasn’t vanished—only become more discerning. As 2025 approaches, capital appears set to flow toward startups demonstrating strong fundamentals, operational efficiency, and clear paths to profitability.
