Bengaluru led February 2024 startup funding with 53%, or Rs 2,661 crore, according to PrivateCircle. PrivateCircle Research found that Mumbai and Delhi NCR companies received Rs 922 crore and Rs 829 crore in financing, respectively, placing second and third in the funding race. The analysis showed a financing gap between Tier 1 and Tier 2, 3 cities. Tier 1 city startups raised 99% of February 2024 financing, while Tier 2 and 3 city startups raised 1%. Tier 1 city companies had an average deal size of Rs 33 crore, whereas Tier 2 and 3 city startups had Rs 4 crore, an almost eight-fold gap.
With roughly 34% of angel deals in Tier 2 and 3 locations, angel investment became the preferred investor type for businesses. Family offices did not participate in VC/PE deals for Tier 2 and 3 city startups, which made up 6%.
Logistics services provider Shadowfax raised Rs 829 crore in a series E round led by TPG New Quest, EV startup River raised Rs 332.2 crore in a series B round led by Yamaha Motor Co Ltd, Japan, and furniture rental platform RentoMojo raised Rs 210 crore in a Series D and D1 round led by Edelweiss Discovery Fund Series – I in February 2024.
Conclusion
PrivateCircle Research only examined investments by Indian-headquartered companies, excluding debt and secondary rounds. Startups were considered companies founded in 2008 or after in Tier 1 cities, including Ahmedabad, Bengaluru, Chennai, Delhi NCR, Hyderabad, Kolkata, Mumbai, and Pune.
