New Delhi: In the December quarter of 2023, funding for startups hit a seven-year low, as they received the lowest equity investment since the underwhelming performance observed in the third quarter of 2016.“As of December 5, the fourth quarter of 2023 saw the lowest equity investment received by new-age ventures since the terrible performance in the third quarter of 2016,” Mint reported, citing data from research platform Tracxn.“The seven-year low in India funding is not something specific to India but seen across the major geographies, including the US, the UK, China and Southeast Asia, as well as globally, (with) similar lows in funding,” the Economic Times reported Neha Singh, cofounder of Tracxn, as saying.Indian startups witnessed a nearly 73% decline in fundraising in 2023, raising $7 billion as compared to $25 billion in the previous year – a significant drop from the funding recorded in 2022, the report said.The top funded sectors included fintech, retail, enterprise applications, environment tech, and space tech.In 2023, the fintech sector has received $2.1 billion in funding as compared to $5.8B received in the same period last year. PhonePe was the top funded company.The retail sector received a total of $1.9 billion in funding in 2023, a 67% decline from 2022. Lenskart was the top funded company.According to the Tracxn report, India dropped to the fifth position in 2023 among the highest-funded geographies globally. It had been ranked fourth in both 2022 and 2021.ET reported that mature startups have been the most affected by the slowdown, as big-ticket investors such as Tiger Global and SoftBank, known for their aggressive deal-making, took a backseat. “Investors also took longer to write new cheques, turning cautious after questions were raised over corporate governance at several venture-backed startups,” it added.
