Ex-Start-Up Execs Raise $101 Mn in 2024, Seed Funding Jumps 243%: Report

Start-ups founded by former executives or operators transitioning from scaling established companies to launching their own ventures are three times more likely to raise funding in seed rounds, according to data released by data intelligence platform Tracxn.

In 2024, such operator-led start-ups collectively secured $101 million, reflecting a sharp 243% jump from 2023. Their share of total venture funding also rose to 11.5% in 2024 from 6% the previous year. This shows a strong upward trend compared to the $53 million rose in 2022, the report commissioned by early-stage VC firm RTP Global said.

Between 2022 and 2024, around 238 former operators founded their own ventures. The average seed round for operator-turned-founders was $1.56 million, around 20% more than the $1.3 million secured by the broader India tech ecosystem.

Of the operator-led start-ups founded in 2022, 11.2% of secured seed rounds, compared to 4.4% of start-ups founded in the rest of India tech.

This trend strengthened in 2023 and held steady in 2024, despite rougher capital conditions. Former operators are raising more. The average seed round for operator-turned-founders, between

The rise in funding is fueled by liquidity from ESOP buybacks, desire for new opportunities, the return of talent from the US, and the impact of mass layoffs, the report said.

Progress to Series A

These operator-founders are now progressing to Series A at higher rates. Among start-ups founded in 2022, over 7% of operator-led ventures have reached Series A, compared to 0.3% of the rest of the India tech. This trend continued in 2024, the report added.

“We have always believed in backing exceptional entrepreneurs. Many operator-founders bring a pragmatic mindset, shaped by real-world experience that helps them scale efficiently. We are constantly looking to deepen our understanding of the diverse paths founders take and this analysis helps us learn more about one such cohort,” said Nishit Garg, Investment Partner, RTP Global.

While the average Series A round size was slightly smaller than the average for the Rest of India Tech, the report said that the operator-led start-ups commanded significantly higher valuations.

The major sectors where former operators entered, include fintech, insurtech, energy, sustainability, and supply chain & logistics. Amog these, insurtech and fintech attracted the highest capital of $28 million between 2022 and 2024, followed by energy at $40.3 million.