Indian Startup Funding All Time High; H1 2021 Funding Grew 100% Over Last Year

  • Indian startups raised a total of $10.8 Bn in the first six months of 2021, which is more than 2x what was raised in the first half of 2020.
  • The first half of 2021 comfortably eclipsed the previous historic half-yearly peak of H2 2017, when $7 Bn was raised by Indian startups.
  • The emergence of 14 new unicorns in just the first six months of 2021 is another major indication of the growing investor appetite around growth and late-stage startups.

The worst for VC investments 

The period between January and June 2020 was arguably the worst for VC investments and startup funding in India. In particular, it was the opening quarter of the fiscal year FY2021 — April to June 2020 —  which was the hardest for startups. Funding amount witnessed a massive decline of 74%, while Indian startups on an average fired 22% of their total employee count during the pandemic-induced lockdown. But one year down the line from June 2020, there couldn’t be a bigger change in the funding prospects for startups in 2021.

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H1 2020 closed at $5.2 Bn across 390 deals

While H1 2020 closed at $5.2 Bn across 390 deals, in H1 2021 (January to June 2021), the total funding raised by Indian startups hit a historic peak of $10.8 Bn raised over 614 funding deals. The total startup funding in the first half of 2021 is already 95% of the total funding amount raised in all of 2020.

Further, this is 2x the funding amount seen in H1 2020 and it also comfortably eclipses the previous historic half-yearly peak of H2 2017, when $7 Bn was raised by Indian startups.

In terms of the number of deals too, H1 2021 pulled ahead of the historic peak of H1 2016, which had recorded 578 deals. In comparison, in H2 2020 (July to December), the deal count was 534, while the total amount raised was $6.3 Bn.

In Q1 2021, Indian startups raised a total of $2.7 Bn from 268 funding deals, so a bulk of the amount and deal tally came in the second quarter of 2021 (April-June quarter), amid the second Covid wave, which severely affected lives and livelihoods of Indians.

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