New Delhi, Jun 26 (KNN) In a significant turn of events, India's startup ecosystem is witnessing a revival in funding, with a particular focus on late-stage startups poised for initial public offerings (IPOs).

This trend marks a departure from previous years, reflecting growing investor confidence and a maturing startup landscape.

The surge in IPOs is particularly noteworthy, with 17 startup IPOs recorded so far in 2024, compared to just 6 in the first half of 2023.

This increase is accompanied by an overall uptick in startup funding, which reached USD 4.1 billion in H1 2024, up from USD 3.96 billion in H2 2023.

Late-stage startups are dominating this funding landscape, with USD 2.4 billion invested across 50 deals in H1 2024, indicating a trend towards larger deal sizes.

Notable funding rounds have made headlines, with quick-commerce startup Zepto raising USD 665 million and e-commerce giant Flipkart securing USD 950 million from Walmart and Google.

These substantial investments underscore the growing appetite for late-stage startups with clear IPO potential.

In preparation for public listings, startups are increasingly focusing on improved performance, compliance, and internal systems. This shift has attracted a diverse group of investors keen to back startups with clear IPO trajectories.

However, the picture isn't entirely rosy. Early-stage startups continue to face funding challenges, with investments remaining flat at USD 1.3 billion in H1 2024 and down 28 per cent year-over-year.

The shift in focus has been attributed to several factors. A record surge in stock markets has boosted investor confidence, while the improved performance of listed startups has set positive benchmarks for the industry.

There's also a better understanding of the path to IPOs among founders and investors alike. Additionally, startups have reoriented their strategies towards profitability and strong unit economics, aligning more closely with public market expectations.

With USD 19.6 billion in dry powder available and 199 India-focused VC funds seeking to raise an additional USD 11.2 billion, the investment landscape appears primed for further growth.

Experts anticipate an accelerated pace of investments in the latter half of 2024 as investors look to deploy capital and diversify their portfolios.

(KNN Bureau)