According to a survey released on Sunday, the Indian startup ecosystem had the lowest six-month investment in the previous four years in the first half of this year, with 298 transactions totaling $3.8 billion. This represents a decrease of over 36% from the second half of 2022 ($5.9 billion).
According to the PwC India study, direct-to-consumer (D2C), SaaS, and fintech remained to be the most financed industries.
84% of the financing activity from January to June was made up of growth and late-stage investment agreements. These accounted for 43% of all transactions during this time.
The research said that the average ticket size for growth-stage agreements was $19 million and for late-stage acquisitions it was $52 million.
“Despite substantial untapped money reserves held by venture capitalists (VCs), there is a slowdown in startup investment. According to Amit Nawka, Partner, Deals & India Startups Leader, PwC India, “Active VC firms in India have secured new funds in the past year, and we can expect the pace of investments to pick up in the coming months.”
In the meanwhile, he said, there has been an increase in the amount of information and coverage put into investors’ due research before making investments.
In terms of volume, early-stage agreements accounted for 57% of the overall financing in H1 CY23. Early-stage agreements made up around 16% of the overall capital in value terms, which was the lowest percentage compared to the previous two years.
With almost 83% of all startup investment activity, Bengaluru, Delhi-NCR, and Mumbai remain the top three startup cities.
