Executive summary

India’s venture capital (VC)/growth equity market continued its upward trajectory in 2025, reaching approximately $16 billion and logging its second consecutive year of growth. This performance was especially notable against the backdrop of softer deployment across private capital overall.

Unlike 2024, when volume largely drove the rebound, 2025 saw more balanced growth across deal volume and average deal size. Larger ($100+ million) funding rounds rebounded, particularly in software/software-as-a-service (SaaS) and fintech, and $250+ million deals doubled year over year. Small and mid-stage activity held firm, with investors focusing on innovation in artificial intelligence (AI), consumer tech, and fintech.

Consumer tech entered a more measured phase. There were fewer mega-deals in 2025 than in 2024, but the sector still recorded higher deal activity compared to 2023.
The quick commerce (Q-commerce) rush of last year was replaced by focused interest in verticalized platforms offering curated assortments and tighter supply chains across categories such as fashion, food, and baby care. Capital continued to flow to scaled direct-to-consumer (D2C) brands in higher-margin segments, with investors prioritizing retention-led growth and disciplined unit economics.

Fintech posted one of the year’s strongest rebounds, with deal value more than doubling year over year. While payments made up the largest transaction segments, investors also expanded into subsectors with more predictable monetization models. For example, wealthtech emerged as a key theme, supported by increased adoption of India’s digital public infrastructure (DPI) rails, rising household savings, and a growing preference for goal-based investing, particularly among the mass and mass affluent segments.

Funding in software/SaaS increased approximately 1.5x year over year. Mature incumbents from the 2021–22 cycle returned to the market, backed by geographic expansion and AI-led product evolution. Younger AI- and generative AI-native business-to-business (B2B) companies also gained traction, particularly in vertical applications. In sectors such as banking, financial services, and insurance (BFSI) and healthcare, use cases moved beyond pilots toward production-scale automation in underwriting, compliance, revenue cycle management, and workflow augmentation.

Exit value held steady overall, but the composition shifted. IPO-led liquidity events gained share, while strategic sales rebounded sharply from 2024 lows. Fintech and consumer tech accounted for the majority of exit value. Regulatory easing, strong retail participation, and resilient equity markets underpinned renewed price discovery and execution certainty, strengthening the pathway from private scale to public markets.

Fund-raising saw a significant increase. Capital raised by VC/growth equity funds doubled year over year, reaching approximately $5.4 billion, driven by a surge in $100+ million vehicles. Thematic focus sharpened around AI, deeptech, climate, space, and industrial technology, signaling a broadening of India’s venture ambition.

India’s VC/growth ecosystem continued to mature, marked by disciplined capital deployment, increased comfort with exit pathways, tighter governance, and clearer visibility into durable value creation. Resilient consumption, sustained public capex, and increased digital infrastructure spending supported this momentum. These conditions for steady, disciplined expansion are expected to remain intact.

About IVCA

The Indian Venture and Alternate Capital Association (IVCA) is a not-for-profit apex industry body that promotes the alternate capital industry and fosters a vibrant investment ecosystem in India. IVCA is committed to supporting the ecosystem by facilitating advocacy discussions with the Government of India, policymakers, and regulators, thereby contributing to the growth of entrepreneurial activity, innovation, and job creation in the country, and supporting the development of India as a leading fund management hub. IVCA represents 490+ funds with a combined AUM of over $350 billion. Our members include some of the most active domestic and global venture capital and private equity funds, as well as funds focused on infrastructure, real estate, and credit. The association also includes limited partners, investment companies, family offices, corporate venture capital investors, and knowledge partners. These funds invest across a wide spectrum of strategies, including early-stage and emerging companies, venture growth, buyouts, special situations, distressed assets, credit, and venture debt, among others.