Tracxn: Indian startups raised $5.46B in H1 2023, down from $17.1B in H1 2022 and $13.4B in H1 2021; Tiger Global made just one deal while SoftBank made none
Several high-flying Indian startups, including Byju's, Swiggy and PharmEasy, have experienced a dramatic downward adjustment in their valuations
Context & Ripple Effects
This H1 2023 tally extends a slide that was already unmistakable in Q3 2022, when Indian funding fell 80% year over year. What changed by mid-2023 is who left: Tiger Global, among the most aggressive late-stage check-writers of the 2021 peak, made just one India deal, and SoftBank made none.
The markdowns at Byju's, Swiggy and PharmEasy are the repricing side of the same coin — the 2021-vintage valuations are being written down as fresh capital evaporates. The full-year picture confirmed the depth: roughly $7B for all of 2023, the lowest since 2018.
First-order effects
- Tiger Global's single deal and SoftBank's zero represent a near-total withdrawal of the two most prolific growth-stage funders of India's 2021 peak, immediately starving late-stage Indian startups of their primary capital source.
- Byju's, Swiggy and PharmEasy are absorbing dramatic downward valuation adjustments, resetting the comparable-price floor for every consumer and health-tech round that follows.
Second-order effects
- With US cross-over capital gone, growth-stage Indian companies must fill Series B/C gaps from domestic and regional investors, shifting term-sheet leverage toward smaller local funds and away from the mega-funds that set prices in 2021.
- As private growth money dries up, the public markets become the pressure valve — a path the corpus later validates with 40+ Indian startup IPOs in 2024, up 80% year over year.
Third-order effects
- Funding is mean-reverting toward pre-boom norms — 2020's ~$9.3B was the last baseline before the 2021 spike — implying the $25B–$37B years were a liquidity anomaly, not a new floor.
- If global mega-funds deploy cyclically rather than continuously, Indian late-stage valuations will keep whipsawing with worldwide rate and liquidity conditions, and sector rotation decides where scarce dollars land — later tallies show AI startups bucking the decline while the broader market stays depressed.
The trend: Indian venture funding is working through a boom-bust-rebuild cycle, swapping 2021's mega-round volume for fewer, more selective checks and public-market exits.