Bain & Company × IVCA
India Venture Capital Report 2026

1. Headline Numbers

India’s VC/growth equity market reached approximately $16 billion in 2025, marking its second consecutive year of growth, notable given softer deployment across private capital overall.

This growth came despite an approximately 18% year-over-year decline in overall PE-VC activity in India, as global macro headwinds including tariff uncertainty, geopolitical tensions, and tighter liquidity constrained leverage-driven private capital flows.

India’s share in Asia-Pacific VC/growth deployment rose to ~20% (up ~2pp YoY), though global share slipped slightly to ~3%, owing to a sharper 1.8x rise in deployments in the us.

 

2. Deal Activity

Unlike 2024, when volume largely drove the rebound, 2025 saw more balanced growth across deal volume and average deal size. Larger ($100M+) funding rounds rebounded, particularly in software/SaaS and fintech, and $250M+ deals doubled year over year.

Both transaction volumes and average deal sizes rose 1.1x each, reaching 1,400 deals at an average ticket of $11.5 million. Activity remained concentrated in sub-$50M investments as investors backed new-age models across consumer tech, fintech, and software/SaaS.

Stage-wise: Early- to mid-stage funding volumes across Series A–C maintained moderately strong momentum in 2025, rebounding to 2022 levels, as dry powder found new waves of innovation. Seed funding volumes increased modestly, driven by investor focus on consumer tech and deeptech start-ups, particularly AI/generative AI players.

 

3. Sectors in Focus

Fintech, Strongest Rebound
Fintech posted one of the year’s strongest rebounds, with deal value more than doubling year over year. While payments made up the largest transaction segment, wealthtech emerged as a key theme, supported by increased adoption of India’s digital public infrastructure (DPI) rails, rising household savings, and a growing preference for goal-based investing.

​

Key deals: PhonePe (~$600M), Snapmint ($125M in lending), and Groww ($205M in wealthtech) were among the five $100M+ fintech deals in 2025 vs. two in 2024.

Wealthtech specifically: Wealthtech deal value grew ~5x vs. 2024, with the mass/mass affluent-focused segment accounting for 72% of deal value in 2025, driven by Aadhaar/UPI-led digital rails materially reducing customer friction.

Software/SaaS, AI-Led Resurgence
Funding in software/SaaS increased approximately 1.5x year over year. Mature incumbents from the 2021–22 cycle returned to the market backed by geographic expansion and AI-led product evolution. Younger AI- and generative AI-native B2B companies also gained traction, particularly in vertical applications.

​

Growth was driven primarily by select large deals, Uniphore ($260M), MoEngage ($180M), Darwinbox ($140M), as companies scaled AI-integrated product offerings and expanded geographically.

Consumer Tech, Measured but Resilient
Consumer tech entered a more measured phase with fewer mega-deals than 2024, but still recorded higher deal activity compared to 2023. The Q-commerce rush was replaced by focused interest in verticalized platforms offering curated assortments across fashion, food, and baby care.

 

Verticalized Q-commerce was a standout green shoot: vertical Q-commerce funding grew ~20x (to ~$150M vs. ~$8M in 2024), with 20+ companies raising funds across food delivery, baby care, fashion, home services, and medicines.

AI/Generative AI
AI/generative AI applications captured a disproportionate share of funding by delivering faster, ROI-visible outcomes, particularly through vertical, workflow-embedded use cases. Foundational AI saw limited funding traction due to structurally high and recurring investment requirements in compute, proprietary data, and specialized talent.

 

In BFSI and healthcare, the two leading verticals, AI use cases shifted from conversational pilots to production-scale automation, with voice agents owning high-volume workflows end-to-end.

 

4. Investor Base & Fund-Raising
India’s VC/growth funding landscape consolidated in 2025, with capital increasingly concentrated among established investors. The share of leading VCs and PE/growth funds rose approximately 5 percentage points to 40% of total VC/growth investments.

Fund-raising rebounded sharply, reaching approximately $5.4 billion in 2025, roughly double 2024 levels, driven by a surge in $100M+ funds and a 35% increase in average fund size. Capital formation was led by established managers rather than first-time funds, signaling limited partners’ preference for proven teams.

Key fund-raises: Among global VCs, Accel raised $650M (Accel India VIII) and Bessemer raised $350M+. Domestic VCs saw 14 raises of $100M+, including A91 Partners ($650M+) and Nexus Ventures ($500M+.

 

Thematic funds sharpened: Deeptech, AI, space, and climate emerged as dominant themes, exemplified by the $1 billion India Deep Tech Alliance.

First-time managers: Larger, established funds led the trend, while first-time managers found it harder to raise capital as LPs leaned more toward proven teams amid improving exit visibility.

 

5. Exit Landscape
Exit activity remained resilient in 2025 with overall value holding steady despite a shift in exit mix, a sharp rebound in strategic sales offset a modest decline in secondary exits and public trades.

Consumer tech and fintech continued to anchor the exit landscape, together accounting for more than 60% of total exit value. Fintech exit value was up approximately 70% year over year.

IPOs, Growing Pillar
IPO-led exits expanded, climbing 30% over 2024 levels, supported by a more accommodative regulatory environment and buoyant equity markets. IPOs with VC exits accounted for 28% of total VC/growth exits in 2025 vs. 22% in 2024.

 

Key IPOs: Groww (~$670M exit), Lenskart (~$475M), Dr. Agarwal’s Healthcare (~$255M), Urban Company (~$170M), Pine Labs (~$165M), and Meesho (~$85M) were among the notable IPOs with VC exits in 2025.

Structural IPO tailwinds: SEBI’s T+3 listing cycle shortened IPO timelines materially. A September 2025 reform extended founder/early investor holding periods, easing compliance and allowing founders to maintain higher ownership during the value creation phase. Demat accounts crossed ~210M in 2025, and DII equity inflows were ~$90B vs. ~$63B in 2024.

Strategic Sales, Sharp Comeback
Strategic exits rebounded sharply to $1B+ (approximately 15x more than 2024), led by fintech, consumer tech, and advanced manufacturing services. Buyers prioritized faster execution, valuation certainty, and assets offering clear synergy.

Key strategic deals: Four key deals drove the rebound, Kinara AI to NXP Semiconductors ($300M+), Axio to Amazon (~$155M), Fisdom to Groww (~$150M), and Minimalist to HUL (~$140M).

 

6. 2026 Outlook
Investor conviction is expected to concentrate around tech-first and infrastructure-led themes, including AI and generative AI, Q-commerce enablement, and clean energy. Capital is likely to increasingly flow to models demonstrating clear monetization and governance discipline.

Q-commerce capital is increasingly flowing toward shared infrastructure platforms, dark stores, warehousing, and delivery networks, lowering entry barriers for D2C brands through asset-light scaling.

Domestic macro resilience is expected to underpin the next phase of funding. Strong GDP growth, sustained public capex, rising consumption, and deepening digital inclusion all support technology adoption despite global uncertainty.

On global risks: rising protectionism and geopolitical tensions are increasing cost and capital volatility, although selective trade realignments, such as new bilateral agreements, are partially offsetting these headwinds.


IPO pipeline for 2026: Several large consumer tech (Zepto, Oyo, AceVector), fintech (PhonePe), and logistics platforms (Shiprocket, Shadowfax) have filed or are advancing toward DRHPs, pointing to a robust and visible IPO pipelin