Tech Sector Dominates with 52.5% VC Funding Surge to $6.5B

CIOTechOutlook Team | Monday, 23 December 2024, 04:54 IST

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The technology industry represented the biggest portion of VC investment at $6.50 billion, increasing by 52.5 percent compared to the same period last year. Consumer discretionary came next with $2.30 billion, an increase of 32.2 percent, while the financial sector drew in $2.20 billion, showing a decrease of 0.6 percent.

According per sources, between January and November 2024, venture capital (VC) activities in India reached a total value of $16.77 billion across 888 transactions, reflecting a 14.1 per cent increase in value and a 21.8 per cent rise in the number of deals compared to $14.69 billion across 729 transactions in the same timeframe of 2023.

Significant agreements feature KiranaKart Technologies (Zepto) valued at $1.3 billion, Poolside AI SAS at $500 million, and Sterlite Power Transmission at $289 million. The year has indicated a resurgence in funding, and industry leaders anticipate this momentum to persist in 2025.

Bhaskar Majumdar, founder and managing partner at Unicorn India Ventures sees a continuation of current trends with more companies heading for initial public offerings (IPOs) and increased activity in later-stage funding rounds. "A lot of funds have been sitting on dry powder and it's only now that they are starting to release," he said.

Both 2023 and 2024 presented difficulties, as worldwide VC investments fell due to reduced interest from LPs (limited partners) in the asset class. Majumdar noted that this trend was starting to shift, as a more positive environment was developing for "right" deals.

Sajith Pai, Partner at Blume Ventures, notes that 2025 is likely to be a year of "great easing" or "great moderation" for the Indian startup ecosystem, growth markets will continue to revive, and IPO activity will remain strong.

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