In recent months, Indian startup funding has noticeably shifted away from the once-frequent mega-rounds exceeding US $100 million. Although the so-called “funding winter” is now largely behind us and venture capital firms have resumed raising new funds, very large private-funding deals are becoming increasingly uncommon.

Key Highlights

• Mega-funding rounds over $100 million are decreasing while Indian start-ups increasingly choose IPOs as growth-capital exit.
• Private funding focuses now on smaller to mid-sized rounds while listing via public markets gains traction in India.

Instead, capital deployment is concentrating in smaller and mid-sized funding rounds — typically in the range of several million to around US $50 million. At the same time, a growing number of startups are choosing to go public via an initial public offering (IPO) rather than rely exclusively on private rounds. For many firms, listing on the public markets is becoming an alternative path to raise growth capital.

This evolution is reflective of a maturing startup ecosystem: investors are increasingly favouring scalability and growth sustained by public-markets access rather than chasing ever-bigger private valuations. At the same time, regulatory and market-dynamics have encouraged a turnaround: the threshold and rules for IPOs in India have become more enabling for growth-stage companies.

Also Read: Indian Startup Funding Falls to $969M in Nov Despite Strong IPO Surge

The implications of this shift are multifold. For startups, choosing an IPO route can bring greater visibility, liquidity, and potentially a firmer footing for long-term growth, but also greater scrutiny and regulatory compliance. For investors, the tapering of mega-rounds suggests a more selective private-capital deployment and possibly more disciplined valuations. And for the ecosystem at large, the decline of mega deals alongside a rise in IPOs signals that exit routes and capital flows are being redistributed and recalibrated.

Overall, the trend suggests that while India’s startup funding engine remains active, its focus is evolving: fewer ultra-large private rounds, more modest sized private deals, and an enhanced role for public listings as a growth-capital channel.