Source: Indiafilings
The final week of January (Jan 26 – Jan 31) brought a cooling period for the Indian startup ecosystem in terms of raw capital, yet the week was far from quiet. While total funding declined significantly week on week, the narrative was dominated by strategic Series C rounds, major layoffs in the gaming sector, and a dramatic shift in the electric vehicle (EV) market.
Here is your comprehensive breakdown of the week’s most critical business moves.
The Funding Landscape: A 58% Weekly Drop
After a blockbuster week last week that saw over $354 million flow into startups, this week the tap tightened. A total of 23 startups raised approximately $147.64 million.
The deal flow was balanced between 4 growth-stage powerhouses and 19 agile early-stage ventures. Despite the lower total, the average funding over the last two months remains steady at roughly $192 million per week, suggesting this dip may be a temporary breather rather than a long-term trend.
Growth-Stage Highlights
Growth-stage firms pulled in $77.8 million across four major deals:
- Easy Home Finance: The Mumbai-based lender secured $30 million in a Series C round led by Investcorp.
- JJG Aero: The aerospace manufacturer also bagged $30 million in its Series B round via Norwest Venture Partners.
- 4baseCare: The precision oncology firm closed the first part of its Series B with Rs 90 crore ($9.8 million).
- SpotDraft: The legal-tech favourite extended its Series B with an $8 million injection from Qualcomm Ventures.
Early-Stage & Deeptech Momentum
Early-stage deals contributed $69.84 million. Notably, The Guild (formerly EtherealX) led the pack with a $20.5 million Series A round to pursue its spacetech ambitions. Agrani Labs also made waves, securing $8 million for AI semiconductor development.
City & Segment Trends
Bengaluru continues to justify its “Silicon Valley of India” title, hosting 14 of the week’s 23 deals. Delhi-NCR followed with 5, while Hyderabad saw 2.
In terms of sectors, Deeptech and AI were the clear favourites, indicating that investors are prioritising high-barrier technologies over traditional consumer plays.
Jobs, Layoffs, and Market Shifts
It wasn’t all positive growth this week. The ecosystem felt the sting of regulatory and market pressures:
- Zupee: The gaming giant announced it is parting ways with 200 employees (40% of its staff) following the ongoing struggles in the real-money gaming sector.
- Ola Electric: In a surprising turn, Ola Electric’s market share plummeted to under 6% this January, down from nearly 25% a year ago. The company is now reducing its workforce by 5% to lean further into automation.
IPO Watch & Financial Results
The public markets saw mixed signals. Turtlemint has officially refreshed its DRHP for a Rs 660 crore IPO, while Shadowfax had a cold reception on the bourses, listing at a 9% discount.
On the earnings front, the “Path to Profitability” is becoming clearer for some:
- Paytm reported a profit of Rs 225 crore in Q3 FY26.
- CRED slashed its operating losses by 51%.
- Swiggy, however, saw losses jump by 32% despite healthy revenue growth.
Acquisitions and Fund Launches
- M&A: Macobs Technologies (Menhood) is entering the health space by acquiring a majority stake in D2C brand Getmymettle.
- New Capital: Navam Capital closed its maiden fund at over Rs 315 crore, while Red Vanda Partners launched a Rs 100 crore fund specifically targeting early-stage ventures.
The final week of January 2026 serves as a microcosm of the “new normal” for the Indian startup ecosystem. While the 58% dip in weekly funding might appear jarring on paper, it reflects a strategic tightening rather than a systemic retreat. Investors are moving away from the “growth-at-all-costs” era, choosing instead to double down on high-moat sectors such as Deep Tech, AI, and Aerospace, where the barriers to entry and the potential for global scale are significantly higher.
