India’s Listed Startups Raise Over $5 Billion: Is the Public Market Now the Real VC?

In a year where the Indian economy weathered headwinds of a slowdown and consumer demand cooled off, one corner of the financial world stood tall — the public markets. For India’s vibrant startup ecosystem, FY25 turned out to be a year of maturity, resilience, and re-rating. The numbers speak loud and clear: Indian venture-backed startups raised over ₹44,000 crore (~$5.3 billion) through IPOs, FPOs, and Qualified Institutional Placements (QIPs), as per Rainmaker Group’s latest RainGauge Index report.

In simpler terms — public markets didn’t just show up, they outpaced private capital as the go-to source of growth capital for late-stage startups. This signals a significant shift: India’s breakout companies are no longer waiting for the next big VC cheque. They’re going public, performing, and winning long-term investor confidence.

IPOs Are Back — But This Time, It’s Different

The journey of Indian startup listings has come full circle. From the IPO frenzy of 2021–22, the reality check and valuation corrections in 2023, to the rationalisation and steady performance in 2024, FY25 ushered in a new era — one marked by fundamentals, discipline, and investor trust.

“FY25 didn’t just test India’s startup listings, it matured them,” said Kashyap Chanchani, Managing Partner at The Rainmaker Group. “We’ve now seen the full arc — the IPO frenzy, the valuation winter, and now a clear re-rating driven by fundamentals. This is the age of seasoning,” he added.

The message is clear: the market is no longer listening to fancy stories. It’s now pricing in substance, scale, and sustainability.

A Season of Exits and Entries

FY25 also saw a record ₹20,000+ crore in secondary exits. Prominent PE/VC firms like Peak XV Partners and TPG unlocked early bets via block trades, capitalising on the market’s appetite for listed tech and consumer digital plays.

Meanwhile, mutual fund participation in listed startups saw a significant jump. Average mutual fund holdings in RainGauge Index companies rose from 10% in March 2024 to 14% by March 2025. This growing institutional participation indicates increased confidence in the financial maturity and governance standards of these new-age companies.

Big Names, Bigger Moves

FY25 wasn’t just about money — it was also about milestones. Some of India’s most familiar startup names made it to the big leagues of the stock market:

• Zomato joined the NIFTY50 and SENSEX, India’s most tracked market indices.

• Swiggy entered the NIFTY Next 50, even before its full-fledged IPO.

• Nykaa, PB Fintech, Ola Electric, and others found a spot in the NIFTY MidCap150.

These entries aren’t just symbolic wins — they bring in serious institutional capital, trading volumes, and long-term investor attention.

🌐 FIIs Exit and Re-Enter — The Comeback Story

At the start of FY25, the market faced turbulence. Foreign Institutional Investors (FIIs) pulled out a whopping ₹78,000 crore in Q1 amid global rate hike fears. But by Q4, the sentiment had shifted. Rate-cut expectations and India’s steady macro fundamentals brought foreign investors back with renewed enthusiasm.

This re-entry shows confidence — not just in India’s economy, but in the resilience of its tech and digital-first companies.

Four Startup Archetypes: Where Do They Stand?

One of the most insightful parts of the RainGauge report is its segmentation of India’s listed startups into four performance archetypes:

1. Scale with Profitability – Startups like Policybazaar and CarTrade have delivered consistent growth while turning profitable.

2. Scale with Margin Pressure – Companies like Zomato and Delhivery continue to grow, while selectively recovering margins.

3. Profit over Growth – Some players have slowed their topline but focused on improving bottom lines.

4. High-Burn Strugglers – Quick commerce and electric vehicle (EV) players still operate in high-burn zones, facing sharper scrutiny from the market.

This kind of segmentation makes it easier for investors to track which startups are truly maturing, and which are still figuring out their path.

A Market That’s Growing Up

FY25 wasn’t about hype. It was about hard choices — chasing margins, cutting losses, cleaning books, and proving that India's startup dream is more than just a pitch deck.

As public markets become the dominant growth engine, startups are realising that the listing game isn’t just a one-time event — it’s a long-term relationship with the investor community. The IPO is no longer the finish line; it’s the beginning of the real test.

And if FY25 is anything to go by, India’s listed startups are slowly but surely growing up.