Indian startups raised $802M in February, a 54% drop from January, with fintech leading. Market sentiment affects large deals and IPOs
Chennai: Amidst significant declines in the stock markets, venture capital fund inflows into Indian startups halved to fall below the $1 billion mark in February despite a strong start in January.
According to data compiled by TheKredible, Indian startups raised a total of $802 million across 98 deals in February. On a monthly basis, February marked a 54 per cent decline from January which recorded $1.76 billion. However, when compared to the past three years' trends, funding in February remained relatively consistent.
Unlike January, which saw three homegrown startups securing over $100 million each, February had no deals exceeding the $100 million mark.
Large deals have been absent primarily due to the extended cooling down of the stock markets, where even some recent startup IPOs have floundered after a strong start. The weak sentiment is bound to have an impact on the domestic market as well, where homegrown VCs and family offices have been playing an increasingly larger role when compared to the erstwhile giants like Softbank and Tiger Global.
Fintech led the sectors with $183.62 million in funding, followed by e-commerce with $156.8 million. SaaS, AI, health-tech, EV, and automotive also raised notable amounts.
In February, Flipkart decided to shut down ANS Commerce, its full-stack e-commerce enabler. February also saw notable consolidation in the Indian startup ecosystem. Perfios acquired CustomerXPs, the fraud detection platform Clari5, for an undisclosed amount. Veranda Learning expanded its presence in commerce education by acquiring stakes in BB Virtuals and Navkar Digital. Meanwhile, Head Digital Works strengthened its portfolio with the acquisition of online poker platform Adda52, among others.
Further, the startup ecosystem saw significant leadership transitions, with 13 senior executives, including CEOs, MDs, CPOs, co-founders, and managing partners, stepping down from their roles. At the same time, over 28 key executive positions were filled.
