Surge in Funding for Indian Startups

Indian startups have witnessed a substantial surge in funding over the last two months, fueled by mega deals from prominent players such as Unacademy and upGrad. According to a report by business intelligence firm Tracxn, a staggering $10.8 billion has been raised by Indian tech startups during this period, marking a significant uptick in investment activity.

Funding Trends

The report highlights that a total of 256 deals were sealed in July and August 2021, indicating robust investor interest and confidence in the Indian startup ecosystem. This surge in funding comes on the heels of a strong performance in the preceding quarters, with $6.5 billion raised across 412 deals in the April to June quarter, and $5.7 billion across 432 deals in the January to March quarter.

Quality Over Quantity

Although the number of startups securing funding in the first two months of the third quarter was relatively lower, the total funding amount saw a substantial increase. In August alone, Indian startups raised an impressive $3.2 billion across 115 rounds, with 17 companies being acquired during the same period. Bengaluru emerged as the frontrunner, clinching the lion’s share of deals as usual.

Edtech Dominance

Notably, three out of the top 10 deals in August were in the edtech sector, underscoring the growing importance of education technology in the Indian startup landscape. Edtech giant Eruditus secured the largest deal of the month, raising a whopping $650 million led by Accel and SoftBank, propelling its valuation to $3.2 billion and cementing its status as the fourth unicorn in the Indian edtech space.

Unicorn Club Expansions

Meanwhile, upGrad, led by Ronnie Screwvala, joined the unicorn club after raising $185 million at a valuation of $1.2 billion. The company attracted fresh investments from Temasek, IFC (International Finance Corporation), and IIFL. Another notable entrant into the unicorn club was Unacademy, which raised $440 million in a funding round led by Mirae Asset and SoftBank, elevating its valuation to $3.44 billion. Byju’s, with a valuation of $16.87 billion, continues to reign as the highest valued edtech startup globally.

The surge in funding for Indian startups, particularly in the edtech sector, reflects the growing investor confidence in the potential of homegrown tech ventures to drive innovation and transformation across various industries.