Source: Starup Rise EU
Venture capital (VC) funding for Indian startups stayed sluggish in the fourth week of July. While startups raised a total of $120 million across 21 deals during the week of 19 July to 25 July, it is only slightly off from funded amounts of $124 million in the previous week.
Funding Levels Remain Flat
Investors continue to be cautious with their dollars. As measured in July, VC funding provided to startups has been consistently around $100 million per week, a much lower weekly funding amount than earlier this year when VC funding was around $200 million per week.
There is an apparent decrease in large deals and a trend for the majority of funding going to either early-stage or late-stage startups. In fact, this week, early-stage and late-stage startups both received approximately $52 million. Growth-stage startups end the week with approximately $11 million in funding, indicating that investors continue to be less willing to invest in startups that are seeking to grow.
Investors Remain Cautious
In general, sentiment in the startup community is not good right now. There are a lot of investors who are still not feeling confident in deploying large amounts of capital. This is not only due to the macroeconomic headwinds, but there is no underlying, strong new trend to generate excitement – excluding artificial intelligence (AI), which still generates a modicum of excitement.
Right now, it does not seem funding will go up any time soon. Unless there is an interruption in the market, or we see more excitement from investors, venture capital funding is Unless market dynamics shift, funding is expected to remain subdued in the near term.
This Week’s Key Deals
Despite the slowdown, some startups have raised decent amounts of capital.
Netrasemi, a semiconductor startup, raised ₹107 crore (roughly $12.3 million) from Zoho Corporation and Unicorn India Ventures.
- Retail startup SuperK raised ₹100 crore (roughly $11.5 million) from 3STATE Ventures, Caratlane founder Mithun Sacheti, cricketer Shubman Gill, Blume Ventures and Xeed Ventures.
- AI startup Kluisz.ai raised $9.6 million from RTP Global, Unicorn India Ventures and others.
- Education financing platform EduFund raised $6 million from Cercano Management and MassMutual Ventures.
- Infra-tech startup Enlite raised ₹46 crore (around $5.3 million) from Avaana Capital and Claypond Capital.
- Travel and lifestyle brand Escape Plan received a $5 million investment from Jungle Ventures and Fireside Ventures.
Conclusion
The fourth week in July confirmed it looks like venture capital funding will continue to be weak in India. With no substantial changes or massive deals within the fund-raising landscape, the investors have maintained their cautious stance. It seems unlikely we will see a significant upturn in private investors’ involvement unless confidence returns or compelling new ideas come into the fund-raising ecosystem in some form.
