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The Indian tech startup ecosystem displayed resilient progress in CY2024, reflecting a year of calculated recovery driven by selective investor participation, steady funding momentum and sustained activity in the entrepreneurial space, according to a Nasscom-Zinnov report titled ‘Road to Recovery – Indian Tech Start-up Landscape 2024’.
The report, released on the sidelines of the Startup Mahakumbh, said that the tech startup sector witnessed a 23 per cent surge in funding, amounting to USD 7.4 billion in CY24.
The number of deals also saw a rise, a 27 per cent increase compared to CY23. The report said that the revival was further underscored by a 2.1x increase in the founding of new tech startups, bringing the total number of startups to anywhere between 32000-35000.
Venture capital theses showcased a priority towards sustainable performance and strong basics over aggressive capital deployment. In terms of funding stages, seed-stage startups showed highest growth at 29 per cent, followed by early stage with 25 per cent and late stage by 21 per cent in CY2024, compared to the previous year.
Rajesh Nambiar, President, Nasscom, said that the growth across mature and emerging sectors, specifically in DeepTech and AI, outlines the Indian tech startup ecosystem’s growing maturity, evolving from being just a hub of opportunities to becoming a strategic force driving India’s digital economy.
“DeepTech startups play an increasingly crucial role in shaping India’s innovation landscape. Our focus now must be on strengthening the foundational pillars of this growth, from enhancing capital access to building robust innovation infrastructure, ensuring our startups can compete globally while solving uniquely Indian challenges,” said Nambiar.
Approximately, 67 per cent of tech startup funding was focused on ‘matured’ sectors, characterized by high aggregate funding value and deal share. Among these sectors, retail tech and health tech emerged as frontrunners and exceeded their 5-year performance averages.
According to the report, Nascent sectors, including aviation, maritime, defence, and environment tech displayed continuous momentum in deal activity, reflecting growing investor interest in emerging tech sectors.
Pari Natarajan, CEO, Zinnov added that the Indian entrepreneur’s story is one of hope, resilience, and an unshakable drive to change the world, and at the heart of India’s growth, startups are fueling innovation and economic transformation.
“India’s tech startup ecosystem has entered a new phase of strategic resilience and scale, with a 2.1X surge in new startups, a record year for tech IPOs, and DeepTech funding soaring 78 per cent to USD 1.6B—87 per cent of which is AI-led. This surge in deep tech funding signals a new era—one where India is not just a consumer of cutting-edge technology but a creator, a leader, and an architect of innovation. The momentum we are witnessing today is an opportunity for the entire ecosystem—investors, academia, industry, and policymakers—to come together and accelerate India’s journey as a deep tech powerhouse,” added Natarajan.
Significantly, India added the 2nd highest number of unicorns at 6, compared to other ecosystems in 2024, taking the combined valuation of current Indian unicorns to over USD 220 billion, with the Unicorns’ share in total funding in CY2024 standing at 33 per cent.
DeepTech funding in CY2024 grew by 78 per cent, reaching USD 1.6 billion. Compared to CY2023, the number of deals in DeepTech startups increased by 24 per cent in CY 2024. Median deal sizes in DeepTech startups outgrew tech startups in CY2024 for all the funding stages. Late-stage DeepTech startups saw the highest growth of 2.7X in median deal sizes as compared to CY 2023, according to the report.
The Nasscom Industry Pulse Survey said that tech start-up founders remain optimistic in their outlook, with the sector outperforming the projected outlook for 2024, with 88 per cent of founders reporting revenue growth. Key drivers included shifts in business models and go-to-market strategies, strategic partnerships for expanded market access, and an increased focus on DeepTech investments.
