Venture capital (VC) investments in India have surged in 2024, reaching $16.77 billion across 888 deals from January to November, according to the India Brand Equity Foundation (IBEF). This represents a 14.1 per cent increase in funding value and a 21.8 per cent rise in deal volume compared to the same period in 2023.
The technology sector led the growth, attracting $6.50 billion, a 52.5 per cent year-over-year (YoY) increase. The consumer related sector followed with $2.30 billion, up 32.2 per cent, while the financial sector saw a slight decline to $2.20 billion. Notable deals included KiranaKart Technologies (Zepto) securing $1.3 billion and Poolside AI SAS raising $500 million.
Optimism for India’s startup growth in 2025
Industry leaders are optimistic about continued growth into 2025, with expectations of more IPOs and increased late-stage funding as cautious investors begin deploying capital. Industry leaders like Bhaskar Majumdar and Sajith Pai foresee a positive shift in India’s startup ecosystem, with easing conditions in the coming year.
Despite concerns over India’s economic reliance on the “India1” segment, which consists of 30 million households contributing heavily to GDP, investor confidence remains strong due to robust savings and capital inflows. Emerging sectors, such as electric mobility and green hydrogen, are creating new opportunities, while traditional sectors like fintech and e-commerce continue to attract attention.
Meanwhile, intellectual property (IP)-driven ventures in deep-tech industries, including robotics, drones, and semiconductors, are gaining traction. The evolving global landscape, particularly the impact of the new US administration on international capital flows, is expected to bring both challenges and opportunities for Indian startups in 2025.
China’s VC market slows down in 2024
In contrast, China’s VC market has experienced a significant slowdown in 2024, with a total of 2,313 deals generating $32.3 billion in funding from January to November, according to GlobalData. This marks a year-on-year (YoY) decline of 23.1 per cent in deal volume and a 22.5 per cent drop in funding value.
This downturn reflects a challenging year for China’s VC ecosystem, driven by regulatory crackdowns, macroeconomic uncertainties, and subdued market conditions. However, China remains a key player in the global VC market, accounting for 15.2 per cent of the total global deal volume and 13.6 per cent of the funding value during the period.
Despite the slowdown, China saw several notable deals, including $1.5 billion raised by Changxin Technology, $1.4 billion by AVATR, $1.1 billion by IM Motors, and $1 billion by Moonshot AI, highlighting the country’s continued significance in the global VC landscape.
(With ANI Inputs)