Bengaluru: Karnataka Tech Funding Report 9M 2025 by Tracxn highlights a period of mixed performance for the state’s tech ecosystem, with early-stage funding showing notable strength even as total investments declined.
Karnataka tech startups raised $2.7 billion in the first nine months of 2025, down 40% from $4.5 billion during the same period in 2024 and 23% lower than the $3.5 billion recorded in 2023.
Bengaluru-based companies contributed nearly all of the funding during this period.
Karnataka Tech Funding Report 9M 2025: Overall Funding Declines as Large Rounds Shrink
The Karnataka Tech Funding Report 9M 2025 shows a significant reduction in large-ticket deals.
Only two rounds crossed the $100 million mark, compared to eight such rounds in 9M 2024 and seven in 9M 2023.
Groww raised $202 million in a Series F round, while Jumbotail secured $120 million in its Series D round.
Also Read: Maharashtra Tech Funding Report 9M 2025: Mumbai Leads with 65 Per Cent of State’s Tech Investments
Karnataka Tech Funding Report 9M 2025: Trends Across Stages
- Seed-stage investment in Karnataka reached $287 million in 9M 2025, showing a 22% drop from $366 million in 2024 and a 21% decline from $361 million in 2023.
- Early-stage funding, however, saw strong momentum, increasing 20% to $1.1 billion from $914 million in 9M 2024, and rising 26% from $871 million in 2023.
- Late-stage funding fell sharply to $1.3 billion in 9M 2025, a 59% decline from $3.2 billion in 2024 and a 41% fall from $2.2 billion in 2023.
Sector Performance: FinTech, Enterprise Applications, and Retail Lead
- FinTech emerged as a top-performing segment with $841 million raised, a 38% increase from $608 million in 2024 but lower than the $1.1 billion recorded in 2023.
- Enterprise Applications secured $830 million, down 19% from $1.0 billion in 2024 and 26% lower than 2023 figures.
- The Retail sector attracted $730 million, a 43% decline from $1.3 billion in 2024 but a 10% increase from $663 million in 2023.
IPOs and Unicorns: Reduced Market Activity
- Karnataka reported two IPOs in 9M 2025 – Ather Energy and BlueStone – reflecting a 67% decline from six IPOs in 9M 2024.
- Three new unicorns emerged during the period, down from five in 2024 but higher than the single new unicorn in 2023.
Acquisition Activity Remains Steady
- A total of 35 acquisitions took place in 9M 2025, slightly below the 37 deals recorded in 9M 2024 but higher than 31 in 2023.
- The highest-valued acquisition was Groww’s $150 million purchase of Fisdom, followed by ICRA’s $26 million acquisition of Fintellix.
Also Read: Delhi NCR Tech Funding Report 9M 2025 Shows Auto Tech Leading with USD 1.3B Funding
Karnataka Tech Funding Report 9M 2025: Investor Participation Across Funding Stages
Investor activity remained robust across stages.
- Seed Stage: Venture Catalysts, Antler, and Rainmatter were the most active.
- Early Stage: Accel, Peak XV Partners, and Elevation Capital led key deals.
- Late Stage: Sofina, SoftBank Vision Fund, and Mars Growth Capital drove major late-stage investments.
Ecosystem Outlook
The Karnataka Tech Funding Report 9M 2025 reflects a dynamic and evolving ecosystem that continues to attract early-stage capital while witnessing more selective participation in late-stage deals.
The emergence of new unicorns, steady acquisition activity, and consistent investor engagement underscore the state’s resilience and maturity during the period.
