Tech Funding in Tamil Nadu Sees Dip: Report

Tech companies from Tamil Nadu raised a total of USD 665 million in 2025, according to a Tracxn report, representing a drop of 3 per cent from the USD 677 million raised the previous year. Late-stage funding recorded a slight decline compared to 2024, but remained significantly higher than 2023 levels, as seed and early-stage investments declined compared to previous years.

According to the report, seed-stage funding amounted to USD 35 million in 2025, marking a drop of 32 per cent compared to USD 51.7 million raised in 2024 and a drop of 37 per cent compared to USD 55.8 million raised in 2023.

Startups in Enterprise Applications, Aerospace, Maritime and Defense Tech and FinTech were the top-performing sectors in the Tamil Nadu Tech ecosystem in 2025, according to the report with enterprise applications recorded total funding of USD 297 million in 2025, marking an increase of 86 percent compared to USD 160M raised in 2024 and an increase of 156 per cent compared to USD 116 million raised in 2023.

The Tamil Nadu tech ecosystem saw 2 USD 100 million+ funding rounds in 2025, up from 1 such round each in 2024 and 2023. During the year, companies including Uniphore and Access Healthcare secured funding exceeding USD 100 million. Uniphore raised USD 260 million in a Series F round, while Access Healthcare garnered USD 211 million through a private equity round. A substantial portion of the USD 100 million+ funding activity in 2025 was driven by the Enterprise Applications segment.

No unicorns were created in 2025, mirroring the trend seen in 2024 and 2023. The state also recorded no IPOs in 2025, consistent with 2024 and marking a 100 percent decline from the single IPO in 2023.

In terms of M&A activity, Tamil Nadu-based tech firms completed 12 acquisitions in 2025, reflecting a 71 per cent increase over 7 acquisitions in 2024 and a 50 per cent rise from 8 acquisitions in 2023. The largest transaction of the year was the acquisition of Resulticks by Diginex for USD 2 billion. This was followed by NIIT’s acquisition of iamneo.ai for USD 7.2 million.

Chennai-headquartered tech companies contributed nearly 100 per cent of the total funding raised across Tamil Nadu in 2025.

On the investor front, Navyug Global, Inflection Point Ventures and Rainmatter were the leading seed-stage investors in 2025. At the early stage, Peak XV Partners, Accel and Kalaari Capital were the most active backers in the region. Late-stage deal activity was dominated by Avatar Growth Capital and Prosperity7 Ventures, which emerged as the top investors supporting mature technology companies in Tamil Nadu during the year.

Overall, the Tamil Nadu tech ecosystem raised USD 655 million in 2025 with late-stage deals accounting for a significant proportion of the total capital deployed. Enterprise Applications led funding by sector and despite multiple large-ticket rounds, no new unicorns were minted. Chennai captured nearly the entire capital inflow, while acquisition activity strengthened year-on-year, led by the USD 2 billion Resulticks transaction.