In addition to funding, India saw a decrease in the number of new unicorns in H1 2023, which also listed the top investors for the year thus far as IPV, Accel, and 100X.VC.
In comparison to the same period in 2022, funding for Indian startups decreased by 72% in the first half of 2023, according to a report titled “Tracxn Geo Semi-Annual Report: India Tech- H1 2023.” From January to June (H1) of this year, the total amount of startup funding in the country was $5.5 billion.
Despite being ranked among the top three funded geographies in the world after the United States and the United Kingdom, the report also stated that the Indian startup funding trend exhibits a global decline, according to CNBC.
In H1 2023, there was also a decline in the number of funding rounds in the Indian startup ecosystem. There were 536 funding rounds in H1 2023 compared to 946 in H2 2022 and more than 1,500 in H1 2022.
However, India’s economy is still one of the fastest-growing, and the startup ecosystem in the nation has enormous growth potential, according to Neha Singh, co-founder of Tracxn.
The company stated in a formal statement, which CNBC reported, that “The growth in this sector can be attributed to the growing Electric Vehicles (EVs) industry in the country, driven by rising EV adoption and favourable government policies promoting cleaner mobility.”
In addition to funding, India saw a decrease in the number of new unicorns in H1 2023, according to the report, which also listed the top investors for the year thus far as IPV, Accel, and 100X.VC.
At Indian startups, a lack of funding has already resulted in layoffs and postponed stock listings. It is expected to get worse and probably result in industry consolidation. V T Bharadwaj, the current managing director of venture capital firm A91 Partners and a former managing director of Sequoia Capital India, declared that “this is a fundamental reset, not just another blip.”
As quoted by ANI, he continued, “I don’t think I’ll again see a record fund-raising year like 2021 for at least a decade.
Tech companies were highly valued and listed on the stock market at prices that generated enormous profits for their investors. The cryptocurrency market was also flourishing. However, interest rates increased, stock market valuations declined along with them, and the cryptocurrency markets crashed in the second half of 2022 and into 2023.