Q3 Reports The Lowest Tech Funding In The Last Five Years, Tracxn Report Says (Image:
The year 2021, an exceptional year of investment has been succeeded by a year which has seen a drop, in tech funding. The Q3 of 2023, July-September was the third straight quarter which saw a declining trend in funding. In the last five years, the Q3 is the lowest or least funded quarter, a report researched by Tracxn said, reported the ET. The $1.5 billion raised by startups in this quarter, is only 29% when compared to the April-June quarter and the 54% on a year on year basis.
In the July-September quarter, the Zepto, a quick commerce startup and Zyber 365, which is a startup for developing the ecosystem for decentralised and cyber secure products and applications, are the only two companies that have been able to take their value beyond $1 billion, to turn into a unicorn. In the last year, the corresponding quarter had four unicorns in among the startups, the Financial Express said.
Along with Zepto and Zyber 365, Perfios which is a fintech firm, Ola Electric and Ather Energy, both EV startups, have been able to raise above $100 million as part of funding. Perfios stands ahead with a series D funding of $229 million from Kedaara, a private equity firm. Venture capital firms Accel, Blume, and Peak XV Partners which was called Sequoia Capital India formerly, are the top investors in the Q3, the report said.
Tracxn co-founder, Neha Singh said on this, “despite facing the challenges of a funding winter, India ranks as the fifth highest funded country in Q3 and maintains its fourth position in terms of total funding for the year to date period.”
The report said that the startups which had raised a funding in the early and seed stages were now seeing a decline of about 75%, being badly hit, when compared to the corresponding quarter last year. The late stage of funding also saw a decline of 33%.
Abhishek Goyal, Tracxn co-founder said, on a month on month basis the funding of the startups have been seen to have gone up 91%, from $376 million in August to $720 million in September.
The top performers of this quarter were enterprise applications, fintech, and transportation and logistics tech. With a 68% year-on-year at $436 million, the growth in fintech sector was the highest among startups. On this, the report said that, this growth is propelled due to the quick growth which could be seen in the adoption of UPI in domestic and international markets like Bhutan, France, the UAE, Saudi Arabia, Bahrain and Singapore. The report further said that, Bengaluru saw the highest funding, followed by Mumbai and Noida, among Indian cities.
