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Seed funding drops 25% in 2024 as VCs retreat

Economic TimesEconomic Times · 8m ago
Seed funding drops 25% in 2024 as VCs retreat
Medial

Seed funding in India experienced a 25% decline in calendar year 2024 as investors remained cautious. Despite this, startups managed to secure $11.3 billion in overall funding, marking a 6% increase compared to the previous year. Pre-IPO and late-stage funding rounds gained popularity due to the shorter paths to liquidity and stronger returns they offer. Seed-stage funding dropped to $971 million from $1.3 billion in the previous year. The decline in seed funding can be attributed to new venture capitalists pulling back from the market, while institutional investors continue to invest steadily. Deep-tech funding, on the other hand, saw an 11% growth. Late-stage funding and early-stage startups performed well in 2024.

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VCs double down on fintech Coast, which aims to be the Brex for 'real-world' industries VCs double down on fintech Coast, the 'Brex for real-world industries'

TechCrunchTechCrunch · 1y ago
VCs double down on fintech Coast, which aims to be the Brex for 'real-world' industries VCs double down on fintech Coast, the 'Brex for real-world industries'
Medial

Coast, a fintech startup focused on expense management for businesses with fleet operations, has raised $25 million in equity funding and $67 million in debt financing. The company offers an expense management software and a commercial charge card designed for fleet operators in industries such as trucking, plumbing, and delivery services. Coast's platform provides detailed visibility into employees' spending, integrates with fleet management software, and offers real-time data on vehicle status and location. The funding will be used to expand Coast's capabilities and financial product offerings to fleet operators.

Seed VCs are turning to new ‘pro rata’ funds that help them compete with the big firms

TechCrunchTechCrunch · 1y ago
Seed VCs are turning to new ‘pro rata’ funds that help them compete with the big firms
Medial

SaaS Ventures, along with other investment firms like Alpha Partners and SignalRank, are helping seed-stage and Series A VCs exercise their pro-rata rights. Pro-rata rights allow VCs to buy more shares in a company during subsequent funding rounds to maintain their ownership percentage. However, in later rounds, new lead investors often want their preferred allocation, potentially squeezing pro-rata investors out of the round. These investment firms provide capital to seed-stage VCs, enabling them to participate in later rounds and exercise their pro-rata rights. The trend of funds dedicated to pro-rata rights is gaining traction as VCs face challenges in funding these rights due to higher valuations.

Funding Winter shuts over 35,000 startups in 2023. Will VCs fund tech ventures?

LivemintLivemint · 1y ago
Funding Winter shuts over 35,000 startups in 2023. Will VCs fund tech ventures?
Medial

The Indian startup ecosystem faced numerous challenges in 2023, resulting in the closure of over 35,000 ventures, as per a report by Bain & Company and the Indian Venture and Alternate Capital Association (IVCA). Factors such as inflation, higher interest rates, softening global consumption, and geopolitical uncertainties contributed to a decline in funding. Deal volume and average deal size both decreased, with a shift towards more seed deals. Tech startups faced a decline, while traditional sectors like BFSI, consumer brands, and healthcare received more attention. Despite the challenges, India remained the second-largest destination for venture capital and growth funding in the Asia Pacific region.

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