Bengaluru
The funding in India’s tech startup ecosystem for the year 2023 has hit a five-year low, leading to a drop in India’s global ranking from 4th to 5th place, as per a new report. The total funding for the year until December 5 stands at $7 billion, a significant 72% decline from the $25 billion recorded in the previous year. The report, from leading global market intelligence platform Tracxn, reveals that only two new unicorns were created in 2023—Incred and Zepto—compared to 23 in the previous year. Additionally, there were 119 acquisitions in 2023, a 36% drop from the 187 acquisitions in 2022. The decline in funding is observed across all stages, with late-stage funding dropping over 73%, followed by early-stage funding (70%) and seed-stage funding (60%). The last quarter (Q4) recorded the lowest funding of $957 million to date, marking it as the lowest-funded quarter since Q3 2016. India’s drop from 4th to 5th place among the highest-funded geographies globally in 2023 reflects the funding slowdown. Despite the challenges, Tracxn remains optimistic about India’s tech startup ecosystem, citing favorable government policies and a fast-growing economy.
