Over the past decade, India’s startup ecosystem has evolved from being a capital-starved, metro-centric experiment to a far more inclusive and stable market, driving investor interest and global attention. Liquidity events have created a new cohort of experienced second-time founders, as domestic and global capital flows deepen, and policy boosts such as production-linked incentives and semiconductor and defence pushes are defining where the next wave of value could emerge. The funding ecosystem itself has a story of evolution. In 2025, Indian startups raised more than $11 Bn from over 936 deals. The overall funding, however, declined 8% from the level reached in 2024. Capital deployment became more disciplined, particularly at the growth stage, where funding rose to $4 Bn in 2025, up from $3.5 Bn a year back. After two years of macroeconomic headwinds, supply chain shocks, and geopolitical uncertainties, compounded by post-COVID capital corrections, 2025 marked a year of valuation reset. Investor confidence has stabilised, with over 90% of investors planning to deploy capital this year. Strategic sectors such as defence tech, applied AI, clean energy, and advanced hardware are seeing rapid capital allocations. These shifts reflect more capital infusion and a broader recognition that India’s next wave of… Read MoreInc42 Media
