Indian startups on path to raise $8-12 billion in 2024: Peak XV MD

Indian startups will likely see an influx of $8-12 billion worth of investments this year, according to venture capital firm Peak XV’s Managing Director Rajan Anandan.

Speaking on the first day of StartUp Mahakumbh on March 18 in Delhi, he also underlined that India’s startup ecosystem has emerged as the most vibrant globally.

Private capital of around $20 billion is still not invested in the startup ecosystem, Anandan said, which is aligned to be infused in privately-owned companies and startups in the country.

The investment run rate in Indian startups before 2021 and 2022 was about $8-10 billion, which went up to about six times to $60 billion in 2021 and 2022 taken together, he said.

"Last year, it was $7 billion, which people said is low. It could have been zero because basically six years of funding came in two years. This year we are well on track for $8-10 or 12 billion. We are going to have an ecosystem which is going to have $10-12 billion for few years and it will go at the natural pace that it should," Anandan said.

The amount of funding that is sufficient for building the Indian startup ecosystem, Anandan said, is $10 billion each year.

The shift in investment focus in the United States towards artificial intelligence (AI) and next-generation software operations is the reason India’s startup ecosystem is emerging as the most vibrant in the world, he added.

Pertaining to the investments PeakXV has made in 2023, Anandan said the venture capital firm has invested in consumer businesses. These were not receiving any funding in the US any longer.

"India today has 20 startups that are being publicly traded. We think that over the next 7-8 years, there will be 100 startups that will go public," Anandan said.

A rise in investments is coming back across the stages of funding, Anandan hinted.

(With PTI Inputs)