Karnataka Tech Funding Plummets to $1.7 Billion in H1 2025

Startups in Karnataka raised $1.7 billion in the 1st half of 2025, according to data from the Tracxn report. This is a 30% drop from the $2.4 billion recorded in the 2nd half of 2024 and 44% lower than the $3 billion raised in H1 2024.

Bengaluru-Based Firms Lead the Tally

Most of the capital raised went to startups based in Bengaluru. The city continued to be the largest contributor to Karnataka’s tech funding. Accel, AngelList, and LetsVenture were among the most active investors in the region.

Fintech attracted $701 million in H1 2025, showing a 255% increase from the $197 million raised in H2 2024. This was also 57% higher compared to H1 2024. Other active sectors included enterprise applications and retail.

Enterprise application startups raised $619 million in H1 2025, which was a slight 3% rise over the same period last year. Retail startups saw funding of $542 million, up 27% from H2 2024, but down 48% compared to H1 2024.

Startup Funding by Stage

Seed-stage funding dropped to $141 million, down 41% from H1 2024. Early-stage deals brought in $611 million, marking a 3% decline. Late-stage investments fell sharply to $930 million, a 56% drop from the same time last year.

Only 2 funding rounds crossed the $100 million mark in H1 2025. These included Groww’s $202 million Series F round and Jumbotail’s $120 million Series D. In comparison, there were 4 such deals in H2 2024 and 5 in H1 2024.

2 new unicorns emerged from Karnataka in H1 2025, up from one in H2 2024. Ather Energy was the only company from the state to go public during this period.

Read more: Startup Funding: India Surpasses Germany & Israel in Global Tech Startup Funding in H1 2025!

Conclusion

Overall funding activity in Karnataka declined in H1 2025, though certain sectors and companies continued to see deal flow. The broader trend showcases reduced investor activity compared to previous periods.

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