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Venture capital funding into Indian startups touched a new high in the third week of June, and this benchmark was achieved largely due to the funding raised by quick commerce unicorn Zepto.

VC funding for the third week of June came in at $872 million cutting across 31 deals. In comparison, the previous week saw a total funding of $223 million.

This sharp rise in VC funding was largely due to the $665 million raised by Zepto. Any spike in VC funding largely happens with large deals flowing into the ecosystem, though these kinds of transactions have been fewer in number.

The funding received in the third week of the month is in fact the highest since 2023. This reveals the challenges that the startup ecosystem continues to face in terms of raising funding and the expectation is that this environment is likely to persist at least for another three more months.

It is likely that certain large deals are in the offing as a report states that Whatfix, a SaaS startup, is in the process of raising funding in the range of $100-150 million.

The other positives for the ecosystem during the week has been the blockbuster listing of Ixigo, which was very close to doubling its IPO price. Additionally, Ola Electric received the approval from SEBI for its IPO and there will be a lot of focus on this issue.

Venture capital firms continue to raise capital as evidenced this week from 8X Ventures and VentureSoul Partners.

At the same time, the challenges remain for the ecosystem. A report by Hurun showed a drop in the unicorn count in the country. On similar lines, funding for the first six months of the year was down 13%.

The third week of June has been a mixed bag for the Indian startup ecosystem and this is likely to be a trend going forward.

Key transactions

Quick commerce unicorn Zepto raised $665 million from Avenir, Lightspeed, Avra, Glade Brook, Nexus, and StepStone, at a $3.6 billion valuation.

Ummeed Housing Finance raised $76 million from A91 Partners, Mirae Asset Venture Investments, Anicut Capital, and Norwest Venture Partners.

MSME lender Aye Finance raised Rs 250 crore (around $30 million) in debt funding from Dutch entrepreneurial development bank FMO.

Craft beer manufacturer Bira91 raised $25 million from Kirin Holdings Singapore.

Fashion brand WROGN raised Rs 125 crore (around $15 million) from TMRW House of Brands, an Aditya Birla Group Venture.

Tech startup OrbitShift raised $7 million from Peak XV’s Surge and Stellaris Venture Partners.

Dvara Kshetriya Gramin Financials (Dvara KGFS), a rural-focused financial services company, raised $7 million in debt from Enabling Qapital.

Healthtech startup Alyve Health raised $5.5 million from Axilor Ventures, 1Crowd Fund, Inhealth Ventures and Trifecta Capital.

Agritech startup Balwaan Krishi raised Rs 40 crore (around $4.7 million) from the private equity arm of JM Financial Ltd.

D2C fashion brand The Pant Project raised $4.25 million from Sorin Investments, MGA Ventures, Huddle, Dexter Ventures and other angel investors.