Indian Startups Funding Q1 2021: Attracted 40% More, Amounting To $4.2 Billion [REPORT]

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After suffering through a year plagued with lockdowns, business slowdown and layoffs, Indian firms have begun 2021 on a positive note.

According to the data released by Venture Intelligence, Indian companies have been able to garner a whopping $11.9 billion in funding from over 199 deals within the first three months of this year.

Venture Intelligence’s data also highlights that a large funding amount in 2021 came from a smaller number of deals when compared to the first three months of the previous year when $6.5 billion was poured into Indian startups from 244 deals.

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Source: Venture Intelligence

This basically means that private equity/venture capital firms have written larger cheques to a smaller number of companies so far in this year.

Investments in startups alone made up $4.2 billion in funding as of March 2021, 40% more than the January-March quarter in 2020, wherein the figures stood at $3.5 billion. In the tech domain, Indian startups such as Zomato, Dream11 and BYJU’s led the majority of funding deals amounting to $1.36 billion.

However, that being said, the major part of the overall funding observed in the first three months of 2021 came through one gigantic deal – Piramal Enterprises acquiring Dewan Housing Finance aka DHFL, for a whopping $5.2 billion.

All in all, it is well understood that there is no holding Indian startups back from getting funded in the new normal. Even while the pandemic was in full swing last year, startups in the country managed to attract over 59 first time international investors, a 37% increase from 2019, where 43 global investors poured funds into Indian startups for the first time.

The global startup ecosystem has its eyes set on India as it has already become the home to 37 unicorns, with 11 of them making it in the coveted ‘$1 billion club’ in the pandemic year itself.

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But then, another recently released report by Credit Suisse revealed that they, via thorough investigation, have found India is the home for 100 unicorns whose combined market capitalization exceeds $240 billion!

Credit Suisse’s India Market Strategy report said that the existence of these many Indian unicorns can be majorly attributed to the lightning-fast pace at which new companies are forming in varied sectors backed by rapid innovation. And to help these companies grow, the availability of funding playing a very crucial role.

Credit Suisse’s report also mentioned that startups now make up 10% of all the new companies that are being formed in India every single year.

Thus, it now remains to be seen how many more funding deals and what amount the Indian startup ecosystem will attract going forward. We will keep you updated on all future developments. Until then, stay tuned.

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