India's Startup Funding Shifts: Angel Investors & VCs Fuel Early & Growth Stages
India's startup ecosystem is witnessing a shift in early-stage funding, with angel investors and venture capitalists (VCs) playing crucial roles. Angel investors, who use personal capital to back startups at pre-seed and seed stages, have seen a rise in activity. Meanwhile, VC firms are focusing on growth and scale-up stages. Government initiatives also provide additional funding support.
Angel investors in India, such as Kunal Shah, Anupam Mittal, and Sanjay Mehta, are actively supporting startups in sectors like SaaS, healthtech, fintech, and climate tech. They not only provide capital but also mentorship, connections, and hands-on guidance. Angel networks like Indian Angel Network, LetsVenture, and Mumbai Angels facilitate these investments.
On the other hand, top VC firms like Sequoia Capital India, Elevation Capital, Accel India, Nexus Venture Partners, and Blume Ventures are focusing on Series A and B rounds. They invest in startups with proven traction, typically at cheque sizes ranging from ₹10 crore to ₹500+ crore. These firms are known for their active investments in early to growth-stage Indian startups.
Early-stage funding in India dropped to about $3 billion in H1 2025, reflecting tighter capital markets and more cautious investor behavior. However, the previous year saw a record high in exits, with private equity and VC exits reaching $22.7 billion. Government initiatives like Startup India, SIDBI Fund of Funds, AI Innovation Grants, and Green Startup Accelerators provide additional funding options for entrepreneurs.
The Indian startup landscape continues to evolve, with angel investors and VC firms playing significant roles in early and growth-stage funding. Despite a slight dip in early-stage funding, the ecosystem remains vibrant, with government support and a robust exit environment. As investors become more selective, startups must demonstrate strong unit economics and innovative solutions to attract capital.
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