Indian startup funding jumps to $2 Bn in February on Neysa’s mega round

India’s startup funding activity showed a mixed trend at the start of 2026. February recorded a sharp jump in total deal value despite limited big ticket funding. Startups raised about $2 billion during the month, driven largely by Neysa’s $1.2 billion equity plus debt round, while no other startup secured a $100 million plus deal in February. The month also saw two listings, Fractal and Aye Finance, both of which received a muted market response.

According to data compiled by Entrackr, Indian startups raised a total of $2 billion across 134 deals in February 2026. Growth and late-stage funding made up $1.6 billion from 17 deals, while early-stage startups raised $405 million through 100 deals. In addition, 17 funding rounds remained undisclosed.

[M-o-M and Y-o-Y trend]

February 2026 recorded $2 billion in startup funding, a sharp jump from $930 million in January and well above $870 million in December. On a year-on-year basis, funding rebounded from $803 million in February 2025, while deal activity increased from 98 to 134 deals.

[Top 10 growth-stage deals]

Growth-stage funding in February was led by Neysa, which raised $1.2 billion in a Series B round. This was followed by Drivn at $80 million through an undisclosed round and IDfy, which secured $53 million in Series F funding. Consumer-facing startups also featured among the larger deals, with The Whole Truth raising $51 million in a Series D round and Supertails closing $30 million in Series C funding.

The rest of the top ten included Stable Money ($25 million), Olyv ($23 million), Varaha ($20 million), Constelli ($20 million), and Pandorum Technologies ($18 million). Collectively, these transactions covered AI, EVs, SaaS, fintech, climate tech, defence tech, biotech, and consumer segments.

[Top 10 early-stage deals]

Early-stage funding activity in February was led by Temple, which raised $54 million in a seed round. This was followed by Showroom B2B at $17 million and Xflow, which secured $16.6 million, both in Series A rounds. ZILO, C2i Semiconductors, and Portkey each raised $15 million in Series A funding.

The rest of the top ten included Loop AI ($14 million), Prayaan Capital ($12 million), and Material Depot along with Vervesemi (both at $10 million). These deals spanned healthtech, fintech, AI, semiconductors, e-commerce, fashion tech, interior design, and MSME lending.

[Mergers and acquisitions]

February saw a steady flow of strategic acquisitions and majority stake transactions across sectors. Bertelsmann acquired an 80% stake in logistics startup LetsTransport, while Rainmatter and USV took majority stakes in PensionBox and Nutritional Lab, respectively.

Consumer and platform-led deals included Marico acquiring a 60% stake in clean nutrition brand Cosmix, while aerospace startup LAT Aerospace acquired Sharang Shakti. In announced transactions, upGrad completed the acquisition of Internshala, BillDesk moved to acquire Worldline SA, and Capillary Technologies announced plans to acquire SessionM Inc..

[City and Segment wise deals]

In February, funding activity was concentrated across a few key hubs. This time, Mumbai accounted for the bulk of capital raised at $1.33 billion across nine deals, or 66.46% of total funding, largely driven by large-ticket transactions. Bengaluru led deal volume with 61 deals and $304.34 million, which accounted for 15.22% of the total, while Delhi-NCR followed with 40 deals worth $286.58 million, equal to 14.33%. Other cities saw limited activity during the month. Hyderabad raised $30.12 million across four deals, or 1.51%, while Pune recorded four deals totalling $3.85 million, or 0.19% of overall funding.

In February, funding activity was heavily skewed toward the AI segment, which recorded 22 deals worth $1.28 billion, or 64.05% of the total capital raised. E-commerce saw 16 deals and $61.27 million, equal to 3.06%, while fintech closed 13 deals amounting to $95.85 million, or 4.79%.

[Series-wise deals]

In February, Series B funding accounted for seven deals, or 63.68% of the total capital raised. Series A followed with 26 deals at 11.88%, while seed-stage rounds led deal volume with 56 deals, accounting for 7.28%. Early-stage activity remained limited, as pre-Series A rounds saw 13 deals at 1.21%, and pre-seed rounds recorded nine deals, or 0.31% of total funding.

[Layoffs, departures and key hires]

Home décor and interior design company Livspace laid off more than 1,000 employees as part of a move to become an AI-native organisation. The company’s co-founder, Saurabh Jain, and chief business officer Lalit Mittal have also exited the firm.

Overall, the month recorded eight exits across the startup ecosystem, even as more than 20 key executive roles were filled. For a detailed overview of these developments, click here.

[Trends]

AI leads the overall funding: AI accounted for about 64% of February’s funding, largely driven by Neysa’s $1.2 billion round, highlighting the impact of large, single-ticket deals on monthly totals.

Muted IPO sentiment: The two February listings—Fractal and Aye Finance—saw a subdued market response, pointing to continued caution around public market debuts.

ESOP buybacks: February recorded two ESOP buybacks by CoinDCX and Unacademy, both from stressed sectors such as crypto and edtech.

Temple’s standout seed round: Temple, a new startup founded by Deepinder Goyal, raised $54 million in a seed round from 94 investors, making it one of the most widely participated seed financings in recent times.

[Conclusion]

Overall, February highlighted how a single mega deal reshaped monthly funding trends, as Neysa’s large round pushed headline numbers sharply higher despite otherwise measured activity. Deal volumes improved, early-stage participation remained steady, and AI continued to attract strong investor interest. At the same time, muted IPO responses and selective capital deployment reflected ongoing caution. Large seed rounds such as Temple’s also signalled confidence in proven founders. Taken together, the month pointed to an ecosystem that is active yet selective, where capital is increasingly concentrated in scale-ready companies and high-conviction opportunities.