85% dip in top VC funding in '23; hopes up for '24

Investments by major foreign venture capital (VC) firms, including Tiger Global, Peak XV Partners, Accel, and SoftBank, in India witnessed a major decline of over 85 per cent in 2023, amid the startup ecosystem facing a funding winter.

- ARYAMAN GUPTA

Despite the investment downturn, foreign investors remain optimistic about the Indian market and are poised to ramp up investment activity this year.

Over the past two years, prominent global VC firms have also divested from some of their investments.

Peak XV Partners (formerly Sequoia India), a prominent investor in India, saw an 87 percent year-on-year (Y-o-Y) decrease in investments, amounting to $197.5 million across 23 deals in 2023, down from $1.5 billion across 38 deals in 2022, according to Tracxn a market intelligence platform.

Similarly, early-stage investor Accel's investments in India across various stages plummeted by 84 percent Y-o-Y to $197.5 million across 18 deals last year, from roughly $1.2 billion across 50 deals in 2022.

Accel has notable investments in companies like Flipkart, Swiggy, Freshworks, and Zetwerk, among others.

Tiger Global, headquartered in the US, reduced its investments by around 71 per cent Y-o-Y to $869.9 million across just five deals in 2023, down from $3 billion across 45 deals in 2022.