VC investment in India rises to $3.5 billion across 355 deals in April-June

New Delhi, July 22
Venture Capital (VC) investment in India rose to $3.5 billion across 355 deals in the second quarter of 2025 (Q2 2025) from $2.8 billion across 456 deals in the preceding quarter, a report said on Tuesday.

During the period, fintech remained one of the hottest sectors for investment in the nation, said KPMG in its latest 'Venture Pulse Q2 2025' report.

“India’s venture capital landscape demonstrated resilience in Q2’25, with funding rising despite global uncertainties. Key sectors like fintech, health-tech, and logistics drew strong investor interest, reflecting confidence in India’s innovation potential,” said Nitish Poddar, Partner and National Leader, Private Equity, KPMG in India.

The quarter’s performance underscores the country’s growing role in shaping the region’s startup ecosystem, Poddar added.

Meanwhile, global venture capital investment declined to $101.05 billion in the quarter from $128.4 billion in Q1 2025.

However, despite the drop, the Q2 remained a relatively strong quarter despite ongoing geopolitical conflicts, trade tensions, and macroeconomic uncertainty, the report stated.

The focus on VC investors remained largely on large-scale opportunities, especially in the AI and defence-tech space.

According to the report, the US dominates global VC investment in AI, attracting deals worth over $1 billion in the space

"The US attracted almost 70 per cent of global VC investment during Q2’25. The AI, defence tech, and space tech sectors accounted for the five largest deals, the report highlighted.

Defence-tech-focused AI companies also raised funds in other parts of the world.

While defence-tech and AI were the hottest sectors of VC investment during the second quarter of the year, fintech also saw a new wave of interest from global VC investors, the report stated.

Meanwhile, VC Investment in Europe holds near steady as investors shift focus to larger and late-stage deals.

VC investment in Europe held nearly steady at $14.6 billion in Q2’25, down only slightly from $16.3 billion in Q1’25, despite a drop in deal count from 2,358 to 1,733, the KPMG report said.

At the same time, VC investment remained very weak in Asia, despite a slight increase in total investment from $12.6 billion in Q1 2025 to $12.8 billion — still the second-lowest total in over a decade.

Deal volume in Asia dropped from 2,663 in Q1 2025 to just 2,022 in Q2 2025, the report noted.