The volatility in India’s startup funding ecosystem persisted through the final week of May 2025. After a brief upswing, investor momentum slowed once again. From May 26 to 31, startups in India raised just $92.9 million across 15 deals — a steep 60% drop from the $231.7 million raised in the previous week. However, amid the lull, one big story stole the spotlight: Drools, a pet food brand, became the third unicorn of 2025, marking a significant milestone in an otherwise quiet week.
Let’s take a closer look at the funding landscape, major deals, IPO moves, and M&A activity shaping India’s startup space this week.
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Image Credits: Zee Business
Drools Enters Unicorn Club, Nestlé Backs the Bite
Pet food startup Drools emerged as the dark horse of the week. The company became India’s third unicorn of the year through a secondary transaction that saw Nestlé India acquiring a minority stake. The deal reflects the growing investor appetite in the petcare space, which is witnessing increased consumer demand, higher spending, and rising brand loyalty.
With Nestlé’s backing, Drools is now in a stronger position to challenge global incumbents and expand aggressively in both Indian and international markets.
Funding Tumbles, But Cleantech and Consumer Services Lead
Despite the low deal value, some sectors showed resilience. The consumer services sector — led by hyperlocal player Snabbit ($19 Mn) and quick commerce startup Slikk ($10 Mn) — was the most funded, pulling in a collective $30 million across three deals.
Cleantech came in close, with Battery Smart bagging $29 million in Series B funding from a clutch of climate-focused investors including Rising Tide Energy and LeapFrog Investments.
On the contrary, ecommerce, despite four deals, raised only $4 million, with two of the transactions being undisclosed. The highest number of deals may not always mean the highest capital inflow.
Early-Stage Funding Takes a Hit
Seed-stage activity also saw a significant drop. Just $3.2 million was raised by four startups at this stage — a sharp fall from the $27.6 million raised in the previous week.
Notable seed and early-stage rounds included:
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Contineu.ai ($1.2 Mn, SenseAI Ventures)
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KhiladiPro ($1 Mn, Shastra VC)
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Cleevo ($1 Mn, Eternal Capital)
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Orbitt Space (Pre-seed, $1 Mn from pi Ventures)
IPO Rush: Groww, Amagi, Razorpay, Moneyview Gear Up
Despite the funding slowdown, Indian startups are not stepping off the IPO gas pedal.
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Groww confidentially filed its IPO papers with SEBI, eyeing a $700 Mn to $1 Bn raise.
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Amagi, the SaaS-based media company, dropped “Private” from its name in preparation for listing.
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Razorpay completed a major milestone by reversing its flip and merging its U.S. parent with its Indian arm.
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Moneyview rebranded its holding entity to Moneyview Pvt Ltd, signaling movement toward its $400 Mn IPO.
M&A Buzz: Imarticus, KiranaPro & Jumbotail Make Moves
The week also saw notable mergers and acquisitions:
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Imarticus Learning acquired MyCaptain for ₹50 Cr in a cash-and-stock deal.
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KiranaPro acquired Likeo for $1 Mn to strengthen its virtual try-on capabilities.
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Jumbotail’s $50 Mn acquisition of Solv India got the green light from the Competition Commission of India (CCI).
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Open-source platform Plane acquired U.S.-based Sort in an undisclosed deal.
What’s Brewing?
Some interesting developments point to a potentially active June:
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Pronto, the home services startup, is in talks to raise $12 Mn Series A.
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Fashion-focused Snitch may soon close a $33 Mn Series B.
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KNOT, a Gen Z fashion label, is eyeing $3 Mn in seed funding.
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Lendingkart may raise $12 Mn in debt from InnoVen Capital.
Image Credits: Bajaj Markets
Final Take
While the dip in funding may cause some concern, the Indian startup ecosystem remains lively, with unicorns emerging, IPO ambitions rising, and strategic M&As underway. Investors appear to be moving cautiously but are still placing big bets on categories with strong fundamentals — especially cleantech, quick commerce, and petcare.
