Venture capital funding for India’s startups fell from $38.5 billion in 2021 to $25.7 billion in 2022, according to the latest report on the sector by Bain and Company, a consultancy, and Indian Venture and Alternate Capital Association. However, more early-stage deals were struck in 2022, helping the overall deal volume to be marginally higher, according to the report, released yesterday. Also in this brief, the Indian IT services sector has become a less significant recruiter, according to a staffing company. Notes: Venture capital funding for India’s startups and other ventures in the country fell from $38 billion in 2021 to $25.7 billion in 2022, according to the latest report on the sector by Bain and Company, a consultancy, and Indian Venture and Alternate Capital Association. However, more early-stage deals were struck in 2022, helping the overall deal volume to be marginally higher, according to the report, released yesterday. There were 1,611 deals in 2022, which was 1.1x the number in 2021, led by an expansion in seed to series B deals. Further, series A deals maintained an average deal size of ~$11 million, cementing a step shift in early-stage dealmaking in India, according to the report. Average series A deals hit the coveted $10 million mark for the first time in 2021. The decline in total funding was driven mostly by a big reduction in the average deal size from $25 million in 2021 to $16 million in 2022. A significant drop in $100 million+ “mega-rounds” (from 92 to 48 over 2021–2022) was a key factor in deal size compression, with global investors exercising caution on large-ticket size deals. The year 2022 also had some positive trends, such as venture funding continuing to go beyond Bengaluru, Mumbai and NCR. Emerging startup hubs received ~18 percent of the funding and accounted for 9 of 23 unicorns added in 2022, according to the report. Software-as-a-service (SaaS) and fintech continued to see momentum relative to 2021, growing from ~25% of total funding to ~35% in 2022. Consumer tech, however, saw a 55 percent drop, from more than $20 billion in 2021 to less than $10 billion in 2022. In more venture news from around the world, one of the world’s biggest fintech startups Stripe, a payments processor in the US, raised $6.5 billion at a $50 billion valuation, a sharp discount from its record valuation of $95 billion in 2021, CNBC reports. And finally, here’s some IT services sector news that I missed from earlier this month. The IT industry put out 33 percent fewer job openings in February 2023 compared with the same period last year, according to the active jobs report of Xpheno, a staffing company, Moneycontrol reported on March 6. According to Xpheno, the active jobs demand in the sector — at 75,000 available jobs — saw an uptick of 15 percent month-on-month mostly because of a lower base in January 2023 when 65,000 jobs were available. Overall, the IT sector’s share of available jobs has continued to trend downward, according to Xpheno. The share of the sector, which used to be the dominant recruiter, has gone from 80 percent of available jobs in 2021 to below 50 percent in the last five months, and the share of non-tech sectors has continued to rise, Moneycontrol reports. The internet-enabled services and startup segments had 17,000 job openings at the end of February, as against 15,000 in January 2023.