India has emerged as the second-largest hub worldwide for funding in the direct-to-consumer (D2C) sector in 2024, according to recent data from market intelligence platform Tracxn. This puts India ahead of major economies like China, the United Kingdom, and Italy, although it trails behind the United States.
The D2C sector, which involves brands selling their products directly to consumers without intermediaries, attracted a total investment of $757 million in India during 2024.
However, the report also highlights a noticeable downward trend in funding for this space. The $757 million raised in 2024 represents an 18% decrease compared to the $930 million secured in 2023. The decline is even more significant when compared to the peak funding year of 2022, which saw a substantial $1.6 billion invested – a 54% drop.
Despite this decrease, India boasts a thriving D2C ecosystem with over 11,000 companies. Notably, only around 800 of these companies have successfully secured funding to date, indicating a large potential for future investment within the sector.
Tracxn’s data reveals that the D2C funding landscape in India experienced its most robust growth in 2021 and 2022. Following this peak, investment has steadily decreased, making 2024 the year with the lowest funding amount since 2021.
While the recent dip in funding might raise some concerns, India’s strong second-place global ranking underscores the significant potential and attractiveness of its direct-to-consumer market for investors worldwide. The large number of existing D2C companies also suggests ample opportunities for future growth and investment in the years to come.