Mumbai Becomes India's Top Startup Funding Hub in 2024
With a remarkable 154% year-on-year growth, Mumbai's startup ecosystem has overtaken Bengaluru to become India's most funded hub in 2024. This surge is largely attributed to significant investment rounds by companies like Zepto, PharmEasy, and Eruditus.
Startup FundingMumbaiBengaluruIndian StartupsVenture CapitalReal Estate MumbaiJan 05, 2025
Total funding raised by Indian startups surged by 20% year-on-year (YoY) to $12 Bn, levels not seen since 2020.
This uptick has rekindled founder optimism and raised hopes for an even better 2025.
One of the most notable trends of 2024 is Mumbai surpassing Bengaluru to become India's most funded startup hub.
According to Inc42’s Indian Startup Funding Report 2024, Mumbai's startup funding soared to $3.7 Bn, a staggering 154% increase from $1.5 Bn in the previous year.
This significant growth can largely be attributed to multiple mega funding rounds by companies like Zepto.
The quick commerce giant, for instance, raised $665 Mn in its Series F funding round in June 2024, doubling its valuation from $1.5 Bn to $3.6 Bn.
Follow-up rounds in August and November added $340 Mn and $350 Mn, respectively, with Zepto alone accounting for 37% of Mumbai's total funding in 2024.
It's worth noting that although Zepto moved its base to Bengaluru this year, its funding rounds were attributed to Mumbai to maintain data consistency.
Mumbai not only outpaced Bengaluru in median ticket sizes, up 15% YoY to $3.4 Mn, but it also saw a notable growth in growth-stage funding and deal counts.
Growth-stage startups in the city raised $472 Mn in 2024, a 28% increase from the previous year, with the number of deals jumping 67% to 50.
Late-stage funding in Mumbai witnessed a 206% YoY surge to $3 Bn, and the number of late-stage deals increased 16% to 29.
Among the top 10 funding deals in the Indian startup ecosystem in 2024, four were from Mumbai.
Healthtech unicorn PharmEasy raised $216.2 Mn in a down round led by the family office of Manipal Group chairman Ranjan Pai in April 2024.
Edtech unicorn Eruditus followed suit in October, securing $150 Mn in a Series F round led by TPG’s global impact investing platform, The Rise Fund.
In December, cloud kitchen unicorn Rebel Foods bagged $210 Mn in Series G funding led by Temasek.
Despite these successes, early-stage funding in Mumbai saw a 21% YoY increase to $137 Mn, but the number of early-stage deals declined by 13% to 70.
This trend raises concerns about Mumbai's ability to sustain its startup ecosystem.
Rajesh Sawhney, the founder of GSF Accelerator, highlights that Mumbai is losing talent and startups to Bengaluru as most new founders come from larger startups or big tech companies.
The exodus of major players like Zepto and Ola has a significant impact, as it reduces the availability of affordable talent crucial for scaled-up companies.
However, the future of startups in Mumbai looks promising.
The city remains a financial hub with high consumption rates, and industries like Bollywood, entertainment, and media continue to thrive.
Sectors such as media tech, D2C brands, and other innovations are likely to emerge from the region.
The Maharashtra government is also taking proactive steps to support startups, aiming to expand the state's startup portfolio from 8,300 to 50,000.
Startups are increasingly looking at Maharashtra as a key destination for setting up manufacturing units, supported by the state's initiatives.
Last year, Ather Energy, an IPO-bound electric two-wheeler maker, announced plans to establish its third manufacturing facility in the state.
Additionally, Maharashtra’s cabinet approved Adani Group’s proposal to set up a $10 Bn semiconductor manufacturing plant in collaboration with Israel’s Tower Semiconductor, bolstering India’s ambition to become a global hub for chip manufacturing.
IIT Bombay’s Society for Innovation & Entrepreneurship (SINE) is launching an INR 100 Cr VC fund to support tech-focused startups, further boosting the ecosystem.
With these strategic investments and initiatives, the future of startups in Mumbai appears bright despite the current challenges.
Frequently Asked Questions
Why did Mumbai surpass Bengaluru as India's top-funded startup hub in 2024?
Mumbai surpassed Bengaluru due to a 154% year-on-year increase in startup funding, largely driven by significant investments in companies like Zepto, PharmEasy, and Eruditus.
What are the key sectors contributing to Mumbai's startup funding growth?
Key sectors contributing to Mumbai's growth include quick commerce, healthtech, edtech, and cloud kitchens.
What challenges is Mumbai's startup ecosystem facing?
Mumbai's startup ecosystem faces challenges like the exodus of major players to Bengaluru, a lack of affordable talent, and a decline in early-stage deals.
What initiatives are the Maharashtra government taking to support startups?
The Maharashtra government aims to expand the state's startup portfolio from 8,300 to 50,000 and is supporting startups through initiatives like Ather Energy's manufacturing facility and Adani Group's semiconductor plant.
What role does IIT Bombay’s Society for Innovation & Entrepreneurship (SINE) play in Mumbai's startup ecosystem?
IIT Bombay’s SINE is launching a VC fund of INR 100 Cr to support tech-focused startups, providing crucial financial backing and mentorship.
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