Venture Capital in India Surged, IPO Boom Fuels Strong Exits: Report The report further states that the strong domestic fundamentals, progressive regulatory reforms, and rising public market activity have helped India's position as Asia Pacific's second-largest VC destination while global funding remained flat.
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Venture capital (VC) landscape in India demonstrated resilience and recovery in 2024, with funding amounting to USD 13.7 billion, which is 1.4 times the 2023 levels, according to a report by management consultant firm Bain & Company.
The report further states that the strong domestic fundamentals, progressive regulatory reforms, and rising public market activity have helped India's position as Asia Pacific's second-largest VC destination while global funding remained flat.
2024 also saw an increase in deal volumes– 880 deals in 2023 compared to 1,270 marking a 45 per cent increase. Less than USD 50 million sized deals made up to 95 per cent of the overall, with USD 50 million+ deals nearly doubling to pre-pandemic levels, said the report. Deals such as Zepto, Meesho, and Lenskart were notable.
Tech-first sectors remained attractive for investors, acquiring more than 60 per cent of the total funding. Funding in consumer tech continued to rise 2.3 times to USD 5.4 billion. The report recognized that B2C commerce and quick commerce were "breakout themes" of the year, with rapid consumer adoption and dynamic propositions from the leading companies.
VC and growth funding in sectors such as software and SaaS, including new-age technology such as artificial intelligence (AI) climbed 1.2 times to USD 1.7 billion from 2023 to 2024. Gen AI funding rose 1.5 times during the period.
"AI isn't just another technological wave—it's a paradigm shift reshaping industries worldwide. Beyond enterprise applications, AI is unlocking massive opportunities in consumer tech, supercharging vertical SaaS, and accelerating digital transformation. From AI-native applications to infrastructure for model testing, the potential for disruption is immense," said VC firm Accel in a statement.
Traditional sectors such as banking, financial services, and insurance (BFSI) and consumer/retail also enjoyed significant fundraise, driven by factors such as underlying strengths, including large addressable markets, untapped demand, and favorable socioeconomic tailwinds, said the report.
"Consumer businesses in India continue to demonstrate robust long-term growth potential, underpinned by favorable demographics, increasing purchasing power, and growing consumer preferences for experimenting with innovative and 'Made in India' brands," said DSG Consumer Partners.
2024 also saw investors other than VCs stepping up, with private equity firms such as KKR investing in Rebel Foods, while family offices and corporate institutions also stepping up funding activity, leading to an increased volume by 1.8 times.
Activity in exits on the other hand remained steady, according to the report with a total of USD 6.8 billions harnessed by the investors. On the back of a significant seven-fold IPO boom in India, public market exits jumped from 50 per cent to 76 per cent.
"We also believe that the IPO market looks bullish, with a strong pipeline of companies set to go public this year. More investment will flow in areas like climate tech, AI, consumer tech, fintech, and edtech. We will also see a rise of hybrid models that blend digital and physical presence," said Lightspeed Partners in a statement.
