Fundraising by venture capital firms remained muted in 2024, much like the year before that. According to data sourced by Pitchbook, 2024 saw the close of 38 new funds with $2.8 billion in commitments, while the year before that had seen 30 new funds raising $2.1 billion in total.
For perspective, between 38-49 new venture capital funds were closed every year since 2015, with commitments between $2.4-$4.5 billion.
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However, 2022 was an outlier year. The post-covid startup funding boom, induced by low interest rates globally, saw 93 new VC funds raise $11.2 billion in commitment, a big chunk of which could not be deployed during the funding winter that followed, leaving sufficient dry powder for subsequent years.
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“The overall fundraising environment was not easy in 2024, primarily because the majority of the world was going for elections last year and there were a lot of uncertainties about the political environment,” said Vikram Gupta, founder and managing partner, IvyCap Ventures. “Especially in India, 85% of the capital being dollar capital, a lot of that capital was held back,” he added.
Mumbai-based IvyCap Ventures, which has backed startups such as online beauty retailer Purplle, jewellery startup Bluestone, brands such as Bewakoof.com and Clovia, marked the final close of its third fund at Rs 2,100 crore ($251 million) in April last year.
Gupta noted that for most Limited Partners (LPs), 2024 was generally a year of cautious approach. But now with more certainty in the political environment, 2025 should be a better year in terms of fundraising for VCs. Sectors such as defence-tech, deep tech, space tech, Internet of Things (IoT), and artificial intelligence got lot of attention from LPs.
Moreover, with over 25 startups expected to list on the bourses this year, VCs are set to see significant exits through public market sale of shares.
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