India’s tech startup sector witnessed a significant surge in funding during the first quarter (January-March) of 2025, securing a total of $2.5 billion in investments. This represents a 13.64% increase compared to the final quarter of 2024 and an 8.7% rise year-over-year, solidifying India’s position as the third-highest funded nation globally, following the United States and the United Kingdom.
The quarter was characterized by a strong emphasis on late-stage funding, which reached $1.8 billion. This marks a substantial 38.46% increase from the previous quarter, and an impressive 114.54% jump compared to the first quarter of 2024. Conversely, early-stage funding experienced a dip, decreasing to $528 million, which is down 23.7% quarter-over-quarter. Seed-stage investments also declined, falling to $157 million, a notable 55.77% decrease year-over-year.
Several significant funding rounds contributed to the overall positive trend. Delhi-based electric vehicle company, Erisha E Mobility, secured a $1 billion Series D round. HR tech platform, Darwinbox, raised $140 million in a Series D round, with the company valued at $947 million. Infra.Market completed a Series F round, securing $121 million and attaining a valuation of $2.55 billion.
The auto tech sector stood out as the top-performing category, attracting $1.1 billion, representing a significant 403.35% increase from the final quarter of 2024. Enterprise Applications and Retail also experienced substantial growth, raising $650.7 million and $481.5 million, respectively.
In addition to direct funding, mergers and acquisitions (M&A) activity also saw a rise, with 38 deals recorded during the quarter, a 15.15% increase from the previous quarter. The largest acquisition was Magma General Insurance, which was acquired for $516 million. The acquisition of Minimalist by HUL for $350 million also contributed significantly.
Initial public offerings (IPOs) saw an uptick, with companies such as Nukleus, Maxvolt Energy, and Volercars entering the public markets. However, a notable shift occurred, as no new unicorns were created during the quarter, contrasting with the first quarter of 2024 when two companies achieved a billion-dollar valuation.
Delhi led in total funding, attracting $1 billion and accounting for 40% of the total investment, followed by Bengaluru with $541 million. Key investors included Accel, Blume Ventures, and Peak XV Partners.
