• Startup funding trends: Annual Indian startup funding has stabilized around $10 billion to $12 billion, with H1 2026 funding rising 12% to over $7 billion while deal volumes fell by more than 30% as capital concentrated into fewer, experienced teams.
• Sector investment shift: Investor capital is shifting away from consumer internet toward capital-intensive AI infrastructure, data centers, clean energy, and deep tech, driven in part by nations seeking domestic, sovereign AI stacks.
• Seed-stage caution: Seed deal volumes have nearly halved as investors maintain a wait-and-watch stance amid rapid AI model rollouts impacting sector valuations and shifting US trade tariffs affecting export-oriented businesses.
• Tech IPO momentum: VC-backed tech listings continue to gain traction with 13 IPOs in the first half of the year, driven by early-stage founders increasingly planning for domestic public listings as early as Series B or C rounds.
• Domestic capital expansion: Family offices and domestic venture funds are taking an increasingly larger share of startup funding in India, while major global funds such as Tiger Global and SoftBank remain relatively quiet.