Indian startups raised more than $11 Bn in 2023: Report

It was an arduous year for Indian startups as the funding crunch continued to haunt the ecosystem. Not that there wasn’t good news: a few inched closer to debuting on the bourses, some hit profitability, and yes, a couple graduated to the unicorn club. But there is no denying that startups struggled to raise money, which led them to recalibrate their strategies. With VC money drying up, there were several mass layoffs at different startups and few companies like ZestMoney, Striker, Anar, Quizy, Frontrow, Fantok and Akudo shut their operations. In our annual report card, we take a granular look at the capital flow in the ecosystem, mergers and acquisitions, and more.


According to startup data intelligence platform TheKredible, more than 980 startups raised venture capital worth more than $11 billion in 2023. The fundraising exercise saw 181 growth stage deals mopping up $8.8 billion while 656 early stage startups raised $2.5 billion. Meanwhile, 147 startups did not disclose their deal size. The startup ecosystem also produced two unicorns this year: Zepto and InCred. In 2021 and 2022, the number of startups that attained a billion dollar valuation were 44 and 26, respectively.

Y-o-Y and M-o-M trend

There was a sharp decline in startup funding from $25 billion in 2022 and $38 billion in 2021 to $11 billion in 2023. The number of deals also dropped from 1,625 in 2021 to 1,556 in 2022 and 984 in 2023. That said, the quantum of funding in 2023 is on par with 2020.


To recap, January started with $1.15 billion in funding but fell below $1 billion in February and again hit $1.37 billion in March. Notably, March was the second-best month in terms of the amount raised in 2023 while December emerged as the most funded month for homegrown startups, thanks to $600 million fundraise by Flipkart. During 2023, three times monthly funding fell below $500 million: July, August, and November.

Check TheKredible to download the full PDF report and database.

Top 10 growth stage deals in 2023

Late stage companies such as PhonePe, Flipkart, and Lenskart were the top three companies in terms of quantum of fundraise, with $850 million, $600 million and $600 million amount raised, respectively. It’s worth noting that Lenskart and PhonePe raised money in multiple tranches.


Lending platform DMI Finance and EV firm Ola Electric also made it to the top 5 list with $400 million and $385 million fundraise, respectively. Udaan, Byju’s, Zepto, Perfios and GreyOrange were among the top 10 list.

Top 10 early stage deals in 2023

InsuranceDekho led the pack of early stage companies as it raked in $150 million in a Series A round. The company went on to raise another $60 million in a Series B round in October.


Agilitas Sports, ChargeZone, BluSmart, and Sarvam AI were in the top 5 early stage fundraising startups in 2023. Check TheKredible for more details.

Mergers and Acquisitions

The year 2021 saw more than 250 mergers and acquisitions. This declined to 204 in 2022 and further reduced to 145 in 2023. While the majority of deals were undisclosed, we have created a top 10 list of M&A concerning the deal size. 

The acquisition of Sachin Bansal’s Chaitanya India by Svatantra Microfin was one of the top acquisitions in 2023. The second on the list is construction marketplace Infra.Market which acquired Strata Geosystems for $110 million.


Some of the notable deals in 2023 include the acquisition of Upwards by Lendingkart, Doubtnut by Allen, GoMechanic by Servizzy, Trillion Loans by BharatPe, Ustraa by VLCC, LYNK by Swiggy, Revv by CarDekho and the merger of Slice with North East Small Finance Bank.

ESOP buyback and payout 

Besides record fundraising, Flipkart also announced $700 million worth cash payout to its 20,000 employees. As per data compiled by TheKredible, more than 80 startups have bought back ESOPs worth $1.46 billion since 2020 or in the last four years. 


Flipkart alone accounted for more than 50% of the entire buyback/payout since 2020. Apart from Flipkart, Swiggy, Log9 Materials, Perfios, CarDekho, Zypp and BetterHalf also announced their ESOP buyback or liquidity plan this year. Overall, the total EOSP buyback/payout/liquidity in 2023 stood at nearly $802 million. In 2021 and 2022, the buyback amount was recorded at $440 and $200 million respectively.

City and segment wise deals

Bengaluru, once again topped the list with 433 startups from the city having raised more than $6.2 billion in funding during 2023. This formed 55% of the total funding. Delhi-NCR-based startups were the next with 217 deals amounting to $2.2 billion. Like 2021 and 2022, Mumbai, Chennai, and Pune made it to the top 5 list this year. Notably, the contribution from Delhi-NCR-based startups fell below 20% in 2023 in terms of the amount raised.

Segment wise, ecommerce was on top with 167 startups raising over $2.9 billion. Fintech, SaaS, healthtech, and EV startups were next on the list. Amount wise, EV startups raised more money than SaaS and healthtech.

Series wise deals

In 2023, seed and pre-seed stage startups dominated the chart with more than 450 deals combined. This was followed by 146 Series A and 132 pre-Series A deals. In the growth stage, Series B, Series C, and Series D saw 52, 36 and 27 deals respectively. In late stage deals, Series E, Series F, and Series G saw 9, 4, and 1 deal(s) respectively. There were 35 debt fundings and 6 pre-IPO rounds.


Interestingly, there were half a dozen deals including Noise, Kabira Mobility

LeadsConnect, Course5 Intelligence and EyeMantra, which have been operating for a decade but raised their maiden round in Series A.

The complete breakdown can be seen in the chart below:

Layoffs, shutdowns and departures

The Indian startup ecosystem saw more than 24,000 layoffs in 2023, up from 20,000 in 2022. Once again edtech company Byju’s was on top with nearly 7,000-8,000 layoffs alone in multiple tranches. Besides Byju’s, Dunzo, Unacademy, ZestMoney, Udaan, and Simplilearn were among the ones that announced layoffs two or more times.

A caveat: The number of employees laid off during 2023 could be higher since several startups may not have reported and there were undisclosed firings in several companies.


During mass firings, more than 15 startups announced their shutting-down operations. The list includes ZestMoney, Anar, Akudo, Striker by MPL, and Quizy among others. Cricket NFT startup Rario, which raised $120 million led by Dream Capital, reportedly fired 60% of its employees and was on the verge of shutting down. GoMechanic also fired 70% of its employees before getting acquired by LifeLong Group.

Meanwhile, the startup ecosystem also saw sudden departures of top level executives especially between October and November. For context, Dunzo and Polygon saw exits of two co-founders each. DealShare also saw the exits of its CEO and COO. The full report can be found here.

Comparison H1 Vs H2

For a better understanding of startup funding, we have created a comparison graph for the first and second half of the year which showed that the number of deals was almost similar during the two periods. Merger and acquisition, however, saw a sharp decline from 81 in the first half to 64 in the second half. The number of layoffs also went down.


Trends in 2023

After edtech, it’s fintech and gaming: While edtech is still the worst-hit sector for consecutive years, fintech and gaming startups are next on the list to bear the brunt. For context, the new guidelines for BNPL companies by the Reserve Bank of India forced companies like ZestMoney and Paytm to halt their future plans. Soon after the 28% GST rule for real money gaming platforms, half a dozen gaming-focused companies shut their operations while several fired hundreds of employees. The number could be larger. Meanwhile, the government has started sending notices to such gaming firms over tax liabilities. As per industry report, India’s gaming market is expected to grow from $2.8 billion in 2022 to $5 billion by 2025. Given the high revenue and profit making segment, gaming firms are likely to go through tough times in the coming months.

Rise in tech IPOs: As per data, 11 Indian startups including Paytm, Zomato, EaseMyTrip, Nazara, Nykaa, and Freshworks, listed on the bourses in 2021. In 2022, only two companies Delhivery and Tracxn managed to go IPO. However, 2023 saw the entry of MamaEarth, ideaForge, Yudiz, Zaggle and Yatra Online on the stock exchange. Moreover, Ola Electric, FirstCry and Awfis also filed their draft red herring prospectus with SEBI. A bunch of startups like Droom, OYO, boAt, Snapdeal, Mobikwik, PharmEasy, and Digit Insurance stalled their plan of going IPO even after filing DRHP. 

Secondary deals: Despite the challenging environment, secondary deals are happening and this can be gauged from the recent buying of shares in FirstCry. SoftBank, the largest stakeholder in the e-commerce firm, sold part of its stake twice in the past four months. The Japanese investor will also sell its stake during the FirstCry IPO. Two more SoftBank-backed firms — Lenskart and Meesho — saw secondary deals this year. Growth stage startups like Perfios, Atomberg, GIVA, Mintify, and Credgenics, also saw secondary deals or provided partial exits to their early backers that reflect a positive outcome of 2023.

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