India sees no new unicorn in Q1
Startup funding nosedives 75% to $2.8bn in March qtr of 2023 as against 14 unicorns in Q1 2022
Representational image.
- Rising inflation, interest rates continue to impact
- Funding volumes contracted due to reduction in late-stage funding
- Leading sectors in terms of funding were fintech, retail and enterprise applications
- Fintech segment witnessed a funding growth of 150% compared to Q4 of 2022
New Delhi: Indian startups raised a total of $2.8 billion in funds in the first quarter of 2023, a massive 75 per cent lower compared to the same period in the previous year ($11.9 billion), as rising inflation and interest rates continue to impact investments significantly amid a deepening funding winter, a report showed on Monday.
There were no new unicorns created in the January-March period, compared with 14 unicorns in Q1 2022, according to the report by Tracxn, a leading global market intelligence platform.
The funding volumes contracted due to the reduction in late-stage funding, which declined by 79 per cent in the first quarter ($1.8 billion) compared to Q1 2022.
Early-stage rounds saw funding of $844 million, a drop of 4 per cent compared to Q4 2022 but a drop of 68 per cent compared to Q1 of 2022.
Moreover, seed funding rounds in Q1 2023 saw funding of $153 million, a 16 per cent drop from Q4 2022. Although funding has decreased YoY, the MoM comparison is more promising as Indian startups saw a significant uptick of 54 per cent from $777 million in February 2023 to $1.2 billion in March 2023.
