India’s deep tech funding soars to $1.6B by 2024: what’s driving the AI surge?

India’s deep tech funding has skyrocketed to $1.6 billion in 2024, a more than fivefold increase from the $300 million raised in 2020, according to a Bay Capital report.

This surge is driven primarily by AI-driven platforms, which dominated the 310 deals recorded in 2024, compared to 100 deals in 2020. The growth reflects a maturing investor base in India, with both retail and institutional investors gaining a sophisticated understanding of digital business metrics such as customer acquisition cost, lifetime value, and retention rates.

The report also highlights a strategic shift among startups, with several planning to reverse-flip and list on Indian stock exchanges. This trend is supported by reforms from the Securities and Exchange Board of India (Sebi), which now allow the listing of loss-making firms, making the Indian market more attractive and credible.

“Investors in India have become more sophisticated in their understanding of digital businesses,” the report states, emphasizing how this has improved startups’ ability to communicate their value propositions.

The combination of regulatory reforms and investor maturity is creating a robust ecosystem for deep tech innovation, particularly in AI, positioning India as a significant player in the global technology landscape.

As startups like InMobi, KreditBee, and Meesho plan to shift their base back to India for public listings, the country’s deep tech sector is poised for further growth and international recognition.

Key stats:
- Funding grew from $300 million in 2020 to $1.6 billion in 2024
- Deals increased from 100 to 310 in the same period
- AI-driven platforms dominate funding rounds

This momentum signals a deepening and credible Indian market for technology startups, supported by regulatory reforms and investor sophistication.

India’s deep tech funding surged to $1.6 billion in 2024, driven by AI platforms, according to Bay Capital. The number of deals rose from 100 in 2020 to 310 in 2024, reflecting growing investor sophistication and regulatory reforms encouraging startups to list domestically, boosting the ecosystem’s credibility.