Funding slows sharply ahead of Union Budget 2026, with hardware deals leading by volume
As the ecosystem braces for Union Budget 2026, to be tabled by Finance Minister Nirmala Sitharaman, startup funding activity cooled noticeably. Was this a pause for policy clarity—or a sign of deeper caution?
Between January 26–30, Indian startups raised $95.6 Mn, a 68% drop from the $302.8 Mn raised the previous week. Deal count stood at 18, reflecting investor restraint amid macro uncertainty.
Funding Snapshot: A Sharp Week-on-Week Dip
The slowdown was broad-based, cutting across stages and sectors.
- Total funding fell to $95.6 Mn, down sharply from $302.8 Mn.
- Investors appeared selective, prioritising conviction bets over volume.
Like traffic easing before a signal turns green, capital seems to be waiting for policy cues.
Fintech Tops by Value, Hardware Leads by Volume
Easy Home Finance anchored the week with a $30 Mn Series C, making fintech the most funded sector by value.
- The Advanced Hardware & Technology segment saw the highest deal count at four.
- Hardware startups cumulatively raised $17 Mn, signalling sustained interest in deeptech fundamentals.
Is capital quietly rotating from fast-growth apps to hard-engineering moats?
Healthtech & AI Hold Ground
Healthcare and AI startups continued to attract steady interest despite the broader slowdown.
- 4baseCare raised $9.8 Mn in a Series B round.
- AI startups such as SpotDraft and Mysa secured mid-sized cheques, reinforcing enterprise demand.
Investors appear to be backing defensible science and workflow-critical software.
Ashish Kacholia Emerges as Most Active Investor
Ace investor Ashish Kacholia stood out with two investments this week.
- Backed 4baseCare and 1Buy.AI, spanning healthtech and B2B ecommerce.
- His activity underscores growing crossover interest from public-market veterans.
Is smart money positioning early for the next IPO cohort?
Seed Funding Takes a Hit
Early-stage capital tightened further as risk appetite softened.
- Seed-stage funding fell 40% week-on-week.
- Only three startups raised a combined $12.9 Mn at this stage.
Founders may need longer runways—or sharper differentiation—to unlock first cheques.
Startup IPO Updates: Mixed Market Signals
Public markets delivered a reality check for new entrants.
- Logistics major Shadowfax closed 11.37% below issue price on its BSE debut.
- Insurtech soonicorn Turtlemint filed an updated DRHP for its INR 660 Cr IPO.
Listings are happening, but pricing discipline is clearly back.
Other Key Developments
Capital formation and consolidation continued behind the scenes.
- Navam Capital closed its maiden deeptech-focused AIF at INR 315 Cr, above target.
- Macobs Technologies acquired a 50.01% stake in Getmymettle for INR 10.5 Cr, entering the protein segment.
Even in slower weeks, strategic moves rarely stop.
TL;DR
Indian startups raised $95.6 Mn between Jan 26–30, down 68% week-on-week, as investors paused ahead of Union Budget 2026. Fintech led by value, hardware by deal count, while seed funding and risk appetite declined sharply.
AI Summary (Points)
- Total funding fell to $95.6 Mn across 18 deals
- Easy Home Finance’s $30 Mn round led the week
- Hardware startups saw the highest deal count
- Seed funding dropped 40% week-on-week
- IPO and fund closures continued despite slowdown
