India Deals Barometer Report: Startup funding doubles to $2.2b in Feb on Neysa’s megadeal

By Pramugdha Mamgain

09 March, 2026

Indian startup funding surged in February, driven by the billion-dollar raise of AI infrastructure startup Neysa, which accounted for half of the month’s total.

Privately-held startups in the country raised $2.2 billion last month, nearly double the $1.1 billion secured in January, according to proprietary data compiled by DealStreetAsia. Much of it came from Neysa’s $1.2 billion funding round, which was also the largest transaction in the month.

Deal volume also rose to 123 in February from 119 in the previous month. The values of 15 deals were undisclosed, the data showed.

On a year-on-year basis, total deal value zoomed 2.3x from $943 million in the same month last year, while deal volume rose 13.8% from 108 last year.

Startup fundraising in India

February saw two megadeals—transactions valued at $100 million or more—led by Neysa and Fractal Analytics.

Neysa’s $1.2 billion round was led by private equity funds affiliated with Blackstone, along with multiple co-investors, and also propelled the company into the startup unicorn club, taking its valuation past the $1 billion mark.

Top 10 deals in February 2026

Meanwhile, Bengaluru-based Fractal Analytics raised nearly $138 million, ahead of the opening of its initial public offering, from a mix of leading domestic mutual funds and global institutional investors. SBI Small Cap Fund and Life Insurance Corporation of India (LIC) emerged as the largest domestic participants in the anchor book.

Neysa’s deal propels software to the top

Buoyed by Neysa’s $1.2 billion deal, startups in the software sector raised a whopping $1.25 billion across 19 transactions in February, accounting for nearly 57% of the total deal value recorded during the month.

Other notable software deals included Portkey, which raised $15 million, followed by Loop AI at $14 million, Myelin Foundry at $5.3 million, CraftifAI at $3 million, and Kris@Work at $3 million, among others.

Outsourcing emerged as the second-most funded industry during the month, attracting $145.5 million across two transactions. These included the $138 million round by Fractal Analytics and a $7.5 million investment in Navikenz.

Retail ranked as the third-most funded sector in February, securing $108 million across 12 deals. Palmonas led the segment with $22 million in funding, followed by Pepperfry ($17.6 million), Showroom B2B ($17 million), ZILO ($15.3 million), Material Depot ($10 million), and DSLR (Aramya) ($9 million), among others.

Together, the three industries—software, outsourcing and retail—accounted for about 68% of the total deal value.

Growth-stage value rises, share in overall funding falls

While growth-stage funding increased in value in February, its share of overall startup funding declined compared with the previous month.

Growth-stage startups—companies raising Series B and later rounds, including private equity and pre-IPO financings—secured $1 billion in funding in February, accounting for nearly 45% of the total capital raised during the month. In comparison, growth-stage deals had raised $564.7 million in January, representing about 50.7% of the month’s total funding.

Startups that raised growth rounds in February included IDfy ($53-million Series F), The Whole Truth ($51-million Series D), Supertails ($30-million Series C), Olyv ($23-million Series C), Palmonas ($22-million Series B), Varaha ($20-million Series B), Pandorum Technologies ($18-million Series B), Wishlink ($17.5-million Series B), among others.

Pre-seed and seed-stage startups saw a marginal increase in funding value in February, raising $76.9 million, compared with $71.9 million in January. However, the number of deals declined to 39 from 43 in the previous month.

The largest seed round during the month was raised by MeltPlan, which secured $10 million for its construction-native AI planning engine in a round led by Bessemer Venture Partners, with participation from NoaVC and WND Ventures.

Other notable seed deals included funding rounds by Elixiir Foods ($9 million), Navikenz ($7.5 million), Fibr AI ($5.7 million), Pulse ($4 million), CraftifAI ($3 million), and ThirdAI ($3 million), among others.

Meanwhile, funding for startups in the pre-Series A and Series A stages declined nearly 5% month-on-month, falling to $264.8 million across 37 deals in February, compared with $278.6 million across 38 deals in January.

The largest Series A round of the month was raised by Jain Cord, a Gurugram-based manufacturer of cotton and linen fabrics, which secured $24 million from the Lohia Family Office, operated under Indorama Capital Holdings Pte. Ltd.

Other notable Series A rounds in the month included Constelli ($20 million), Showroom B2B ($17 million), Xflow ($16.6 million), ZILO ($15.3 million), C2i Semiconductors ($15 million), Portkey ($15 million), Loop AI ($14 million), Vervesemi ($10 million), and Material Depot ($10 million).

Debt funding escalated to $600 million in February from $56.2 million in January.

Top investors

Venture capital firm Peak XV Partners emerged as the top investor in February with 11 investments in total. The firm’s investees included recruitment platform Kello, AI-native workspaces startup Memfold AI, social media platform Round1, interactive video bazaar Zoop, wealthtech startup Stable Money, fashion quick-commerce startup ZILO, C2i Semiconductors, consumer AI startup Companion Labs, wearable startup Temple, clean-label food brand The Whole Truth, and healthcare-focused fintech startup Care.fi.

Accel occupied the second spot with five investments, including in interior design and home decor startup Material Depot, ethnic wear brand DSLR (Aramya), proptech startup Spintly, AI-native martech startup Fibr AI, and data infrastructure startup S2.dev.

Venture Catalysts, along with its accelerator fund 100Unicorns, Antler India, Inflection Point Ventures, Titan Capital made at least four investments each.

DealStreetAsia Partner Content

‘In an era of virtual dealmaking, stakeholders tend to be more transparent’ – DFIN’s Peter McMillan

Over half the deals in the next 3 months will be hosted virtually according to 79% of the respondents in DFIN’s DealMaker Meter Survey. Peter McMillan, Head of Sales for APAC at DCIN speaks of the advantages of virtual dealmaking as well as the pitfalls to be avoided, in an exclusive interview with DealStreetAsia

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