Delhi Surpasses Bengaluru to Emerge as India’s Top Startups Funding Hub in Q1 2025

New Delhi, India – March 28, 2025 – In a significant shift within India’s entrepreneurial landscape, Delhi has overtaken Bengaluru as the leading city for startups funding in the first quarter of 2025. The National Capital Region (NCR) accounted for approximately 40% of all venture capital and private equity funding raised by Indian startups during this period, reflecting a transformation in investor preference and regional startups growth dynamics.

This development signals Delhi’s emergence not just as an administrative and political centre, but increasingly as an innovation and entrepreneurial powerhouse in India’s rapidly evolving start-up ecosystem.

Overview: India’s Startups Funding Rebounds in Q1 2025

According to data aggregated from investment tracking platforms and venture capital reports, Indian startups raised $2.5 billion in Q1 2025, marking a 13.64% quarter-over-quarter growth compared to Q4 2024. This increase follows a period of cautious optimism in the investment landscape, amid easing global economic volatility and recovering investor sentiment.

Despite continued global concerns over inflation, interest rate hikes in developed markets, and funding slowdowns in other regions, India has bucked the trend, with a renewed surge in deal-making and early-stage funding.

Delhi’s Rise: What’s Driving the Shift?

Delhi’s ascent to the top of India’s start-up funding leader board is the result of several structural and ecosystem-level developments:

1. Proximity to Policymakers and Regulators

Being close to the heart of India’s regulatory ecosystem gives startups in Delhi NCR a strategic advantage. Policy-driven sectors like FinTech, CleanTech and EdTech benefit from faster regulatory clarity and engagement with ministries and authorities.

2. Ecosystem Maturity

Delhi NCR now hosts over 7,000 active startups, with hubs in Gurgaon, Noida, and Central Delhi. The region has moved beyond early-stage startups, with many ventures now entering Series B and Series C rounds – drawing attention from global venture capital firms.

3. Sectoral Diversity and Demand

Delhi’s start-up landscape is diverse and consumer-centric, spanning e-commerce, EV mobility, fintech, D2C brands, health tech, logistics, and AgriTech. This diversity reduces sector-specific risk and appeals to a broader base of investors.

4. Talent and Infrastructure

With access to premier institutions like IIT Delhi, Delhi University, and IIIT Delhi, the region provides a robust talent pipeline. Additionally, improved infrastructure and connectivity in Gurgaon and Noida have made the area attractive for start-up operations.

Key Deals That Fuelled Delhi’s Funding Surge

Several high-value funding rounds in Q1 2025 contributed to Delhi’s dominance:

• Erisha E Mobility: Raised a substantial round (undisclosed, estimated $120–150 million) to expand its EV infrastructure, battery-swapping network, and local manufacturing. The funding round included participation from global climate tech funds and sovereign investors.
• Flipkart (NCR operations): Secured a new round of investment led by SoftBank and sovereign wealth funds, focusing on AI-powered supply chain optimization and next-generation commerce platforms. While Flipkart has operations across India, much of its strategic technology team operates from Gurgaon.
• OfBusiness (B2B commerce): Expanded funding to scale its fintech integrations and AI-based procurement tools for SMEs.
• 1K Kirana and Curelink: Early-stage retail tech and health tech startups that received seed-to-Series A funding from domestic and global VC funds.

Bengaluru: Still a Strong Tech Powerhouse

Although Delhi has taken the top spot in Q1 2025, Bengaluru remains India’s core technology and R&D engine. The city secured the second-largest funding volume during the quarter, with strong support from investors in deep-tech, SaaS, AI, and crypto/blockchain domains.

Notable Bengaluru-based funding activity included:

• Hasura (GraphQL API platform) and Jupiter (neobank) continuing to attract global VC interest.
• AI and robotics startups, especially those in generative AI and industrial automation, raised early-stage rounds.
• Bengaluru remains the preferred destination for tech-heavy startups, especially those requiring engineering talent and advanced computing resources.

Startups Ecosystem Outlook: What’s Next for 2025?

Looking ahead, India’s start-up ecosystem is expected to continue its upward trajectory, fuelled by the following trends:

1. Growth in Deep-Tech and AI

India is witnessing a surge in generative AI applications, cybersecurity platforms, and quantum computing ventures. Bengaluru and Hyderabad are emerging hubs in this space.

2. Green and Sustainable Tech

Delhi and Mumbai are showing momentum in climate tech, EV infrastructure, and sustainability startups, with funding flowing in from ESG-focused funds.

3. Health Tech and Bio-innovation

With public health becoming a strategic priority post-COVID-19, biotech and digital health startups – especially those offering affordable diagnostics and AI-driven patient care – are drawing global attention.

4. Tier-II and Tier-III Cities on the Radar

As infrastructure and digital literacy improve in India’s smaller towns, investors are beginning to back startups based in cities like Indore, Jaipur, Lucknow, and Bhubaneswar, broadening the funding map.

Investor Sentiment and Capital Trends

• Global VC interest is rebounding, particularly in late-stage startups with proven business models and path-to-profitability plans.
• Domestic funds and family offices are becoming more active, often leading rounds in seed and early-stage deals.
• Investors are demanding higher transparency, better unit economics, and shorter profitability timelines compared to the pre-2023 funding frenzy.

Conclusion: A New Phase of Indian Entrepreneurship

Delhi’s rise to the top of India’s start-up funding charts marks a new chapter in the country’s innovation narrative. The National Capital Region is no longer just a policy hub but is now firmly establishing itself as a national leader in start-up innovation, capital attraction, and sectoral diversification.

However, rather than replacing Bengaluru, Delhi’s ascent complements India’s multi-city innovation economy – where different regions bring unique strengths to the table.

The coming quarters will reveal whether Delhi can sustain this momentum, or if other cities will rise in the competitive race to become India’s innovation capital.

Reference: Data compiled from Tracxn, Crunchbase, PitchBook, and company press releases as of March 28, 2025. For investment decisions, always consult certified financial advisors and verified company disclosures.