New Delhi, January 11: Funding for Indian startups dropped by 33 per cent to USD 24 billion in 2022 as compared to the previous year though it was nearly double the amount recorded in 2019 or 2020, said a PwC India report on Wednesday.

Global investors were still positive about the Indian startup ecosystem despite the global slowdown, as per the report titled 'Startup Tracker-CY 22'. "Funding for Indian startups in CY22 was nearly USD 24 billion, a drop of 33 per cent in comparison to CY21 but was still more than twice the funds raised in CY20 and CY19 each", it said. 10 Emerging Indian Startup in 2023 Making Big Difference.

The startups received total funding of USD 13.2 billion in 2019, USD 10.9 billion in 2020 and USD 35.2 billion in 2021. Despite the funding slowdown, Amit Nawka, Partner - Deals & India Startups Leader, PwC India, said, "some areas like SaaS (Software as a service) and early-stage funding have remained upbeat. With significant dry powder waiting to be invested, it seems likely that the funding scenario will begin to normalise after 2-3 quarters."

Meanwhile, he added, many startups were using the current situation to tighten operating models and optimise cash runway by deferring discretionary spends and investments. The report said the early-stage deals accounted for 60–62 per cent of the total funding in 2021 and 2022 in volume terms and average ticket size per deal was USD 4 million per deal.

In value terms, it added, early-stage deals contributed to approximately 12 per cent of the total funding in 2022 compared to nearly 7 per cent in 2021. Growth and late-stage funding deals accounted for 88 per cent of the funding activity in 2022 in value terms, representing 38 per cent of the total count of deals. Google Backs Indian Agritech Startup Cropin in Its Rs 113 Crore Funding.

According to the report, average ticket size in growth-stage deals was USD 43 million and late-stage deal was USD 94 million during 2022. As regards the city-wise startup funding, the report said, Bengaluru, NCR and Mumbai accounted for nearly 82 per cent of total Indian startups as of December 2022. As many as 28 per cent of startups in the top three cities have raised in excess of USD 20 million.

Bengaluru witnessed the highest number of unicorns, followed by NCR and Mumbai. Similar trends have been noted for other companies that have raised more than USD 50–100 million, the report said.