From Ecommerce To Fintech: Here Are The Top Funded Startup Sectors Of 2024

The year 2024 marked a significant turnaround for the Indian startup ecosystem, signalling recovery and growth after the market corrections of 2022 and 2023.

According to Inc42’s ‘Indian Tech Startup Funding Report 2024’, startups raised over $12 Bn in funding this year, a 20% increase from the $10 Bn raised last year. This growth shows a rebound in investor confidence and entrepreneurial momentum.

As of December 21, 2024, 993 funding deals were finalised, marking an 11% growth compared to the previous year. 

The year also witnessed a surge in IPO activity, with 13 new-age tech companies, including Swiggy, Go Digit, MobiKwik, Awfis, among others, making their stock market debut. Listed players like Zomato, Zaggle, and Nazara Technologies also raised additional funds. 

Leading the funding landscape in 2024 were fintech, consumer services, enterprise tech, and ecommerce sectors, which together accounted for two-third of the total funding raised. In terms of deal count, ecommerce took the top spot with 203 deals, followed by enterprise tech and fintech with 167 and 162 deals, respectively. 

Beyond the usual suspects, there was also a noticeable resurgence of investor interest across sectors such as edtech, healthtech and consumer services. Now, as we stand at the end of 2024, let’s take a look at the top funded sectors this year as part of Inc42’s ‘Year In Review’ series.

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Fintech Leads The Way As The Most Funded Sector Of 2024

Fintech continued to dominate the investment landscape at the sectoral level in 2024 as well. Over 162 deals materialised in the sector this year, with startups collectively raising $2.5 Bn.

However, on a year-on-year (YoY) basis, total funding dropped 17% from $3 Bn raised across 129 deals last year. Despite this, fintech remained the standout sector and continued to be the most funded in India’s startup ecosystem.

Of the $893 Mn funding raised by seed stage startups in 2024, fintech startups accounted for 18.3%. The sector also emerged as the most funded one in terms of funding raised by growth stage and late stage startups. Among growth stage startups, fintech accounted for 17.1% of the $3.5 Bn raised. For late stage startups, fintech’s share was at 23.8% of the total $7 Bn in funding.

Finova Capital, Drip Capital, and M2P secured some of the biggest funding deals in the fintech sector this year. While Finova raised $135 Mn, Drip Capital and M2P bagged $113 Mn and $101 Mn, respectively.

Ecommerce A Strong Performer Despite Slowdown

On the back of the rapidly growing base of online shoppers and the growth of D2C platforms, ecommerce continued to be among the top funded sectors of 2024.

However, the sector saw a sharp decline in terms of funding amount. Ecommerce startups raised $1.5 Bn in 2024, down 42.3% compared to the $2.6 Bn raised in 2023. Despite this dip, the Indian ecommerce sector saw the maximum number of funding deals at 203 deals in 2024. 

As a result, ecommerce emerged as one of the most funded sectors in the early stage, with startups in the space raising $127 Mn out of the total $893 Mn raised by early stage ventures.

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Some of the biggest deals of the year included those of Kushal’s, The Ayurveda Experience and Curefoods. While Kushal’s raised $34 Mn, The Ayurveda Experience secured $27 Mn and Curefoods raised $25 Mn. 

Another Strong Year For Enterprise Tech

Enterprise tech emerged as the third-most funded sector in India’s startup ecosystem in 2024, with over 167 startups raising $1.8 Bn. However, unlike fintech and ecommerce sectors, the funding amount for the enterprise tech sector zoomed 38.5% from $1.3 Bn in 2023, when 150 startups bagged capital.

The sector led the deal count at the seed stage, accounting for 21.5% of the total 433 deals. It also topped the funding amount, securing 28.1% of the total $893 Mn raised.

Enterprise tech also witnessed some of the largest funding rounds of the year, including iBUS’ $200 Mn fundraise, and Whatfix’s $125 Mn deal.

Zepto’s $1.3 Bn Fundraise Boosts Consumer Services’ Fortunes

The year gone by also saw consumer services emerge as one of the most funded sectors in 2024. With a funding of $1.8 Bn across 48 deals, the sector saw significant growth this year compared to $385 Mn raised across 39 deals in 2023. 

This increase largely on the back of the mega funding rounds of quick commerce major Zepto, which raised $1.3 Bn in total across three separate rounds. The rise in funding indicates a strong surge in investor interest in the consumer services space.

The consumer services sector has been buoyed by the rise of quick commerce, which has seen rapid growth in popularity over the last couple of years. This is evident in the performance of first movers like Blinkit, Swiggy Instamart, and Zepto, which together reported over $1 Bn in revenue in the fiscal year 2023-24 (FY24). 

Cleantech Continues To Prowl In The Shadows

Grabbing the fourth spot on the list of the most funded sectors of 2024 was the cleantech sector.  It saw 75 deals totalling $829 Mn this year, a slight decline from $861 Mn raised in 2023 via 57  deals. The increase in the number of deals shows a dip in the average deal size in 2024. 

The funding in the cleantech sector came on the back of investments in solar power, EV infrastructure, and budding innovation in green hydrogen and nuclear fusion. However, it is also pertinent to note that the cleantech space has been on a decline since at least 2022. 

Although two-thirds of India’s 800 climate tech startups have secured seed funding, less than 3% have raised Series B or beyond, highlighting the need for later-stage investments to scale impactful solutions.

Meanwhile, healthtech moved ahead of deeptech to claim the fifth spot in 2024, raising $716 Mn across 78 deals. This surge came due to the growing adoption of AI by startups. Meanwhile, the deeptech sector secured $460 Mn across 73 deals in 2024. 

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Peering Into The Crystal Ball: What 2025 Holds For The Startup Ecosystem

The year 2024 saw India’s startup ecosystem staging a rebound, signaling its ability to bounce back and adapt despite global economic challenges. With a notable increase in overall funding, deal activity, and IPO momentum, the ecosystem demonstrated renewed investor confidence and entrepreneurial vigor. 

Going forward, the year 2025 is expected to bring new challenges and avenues of growth for Indian startups. For starters, GenAI startups are expected to rake in a funding of $395 Mn (up 36% YoY), driven primarily by innovations in vertical AI, enterprise AI, and responsible AI sub-segments.

Besides, the consumer services sector is projected to raise capital north of $2 Bn (+11% YoY), fueled by growing popularity of quick commerce and subscription services. Meanwhile, cleantech will remain a critical sector, with a focus on EV components, climate tech, charging infrastructure, and waste management. 

Inc42 estimates the healthtech sector to lap up $850 Mn in funding (+21% YoY) in 2024 on the back of increasing use of AI in healthcare, biotechnology, and fitness solutions. The edtech sector is likely to continue to face headwinds, with funding anticipated to decline by 33% to $400 Mn. However, the startups in the sector will see new opportunities through innovation in AI-driven tutoring and gamified education platforms.

Ecommerce funding is expected to grow 20% YoY to $1.8 Bn in 2025, with emphasis on instant delivery, hybrid retail, and clean-label brands.

“With 2024 being a successful year for the ecommerce industry, 2025 is poised for even greater growth. This growth will be driven by an increasing number of online shoppers, particularly from Tier II & III cities, where improved digital literacy and internet accessibility are expanding the consumer base,” according to coupons and cashback app CashKaro’s cofounder Rohan Bhargava.

[Edited By Vinaykumar Rai]

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