The report found that 73% of founders view a domestic IPO as the most likely exit option, up from 64% in 2023 and 63% in 2022. Meanwhile, mergers and acquisitions (M&A) as an exit route have continued to decline, dropping to 19% in 2024, down from 22% in 2023 and 28% in 2022.
“2024 reversed the trend of a weak funding environment, with investments increasing to around $12 billion. We saw numerous tech IPOs, such as Swiggy, Ola Electric, Firstcry, Blackbuck, Awfis, Ixigo, etc. While the macro is challenging, we expect several high-quality companies to go public in 2025,” said Ashish Sharma, managing partner, Innoven Capital India.
The 10th edition of the India startup outlook report, based on insights from over 100 startup founders, also found a slight shift in priorities. The emphasis on profitability has decreased, with 53% of founders prioritising profitability over growth in 2024, down from 62% in 2023.
Despite this, the percentage of startups that are profitable at earnings before interest, taxes, depreciation and amortisation (Ebitda) level has risen steadily, reaching 41% in 2024, up from 30% the previous year.
Hiring expectations have also improved, with 47% of founders planning to expand their teams in 2025, up from 39% in 2024. However, gender diversity in leadership remains low with 83% of startups having less than 20% women in leadership roles.
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The report also highlighted a dip in positive fundraising experiences. While 63% of founders who attempted to raise funds in 2024 reported a favourable experience, this was down from 68% in 2023. However, founders expect the funding environment to improve in 2025, with those in SaaS, fintech, and consumer startups being the most optimistic.
Most founders believe that focus on sustainable business models has been a key outcome of the funding slowdown, leading to valuation corrections. As funding activity picks up, 83% of founders remain optimistic about raising their next round at a higher valuation this year.
