India’s direct-to-consumer (D2C) ecosystem is maturing—and investors are raising the revenue thresholds they expect from brands seeking funding.
The shift is visible from the seed stage through later funding rounds and is partly a consequence of how easy it has become to launch a brand and scale its reach across multiple channels, including e-commerce and quick commerce.
At the seed stage, investors are increasingly looking for ₹2–3 crore in annual revenue, up from roughly ₹1 crore earlier, according to industry experts. At Series A and beyond, the revenue bar has also moved higher, with investors increasingly wary of companies unless the growth and economics justify the next round.
The paradox is that easier distribution is making topline growth less valuable as a standalone signal. Investors increasingly want brands to demonstrate repeat purchases, healthy unit economics, profitability and the potential to become large businesses.
“The entry barrier to building a brand has fallen dramatically. With contract manufacturing, Amazon, quick commerce, Meta and D2C websites, pan-India distribution has become much easier. As a result, crossing a higher revenue threshold is no longer as strong a signal of product-market fit as it used to be. It could simply reflect a small group of passionate early adopters,” said Harmanpreet Singh, founder and managing partner at early-stage VC firm Prath Ventures.
The higher bar is particularly evident as brands move beyond the early stages. Funding in the D2C space for Series A and above rounds fell from $416 million in H1 2025 to $280 million in H1 2026, according to data platform Tracxn. While the number of deals during this time, decreased from 47 in H1 2025 to 38 in H1 2026,
Funding squeeze
The bar has gone up most at the mid-stages, between Series B and D, as scaling becomes less of an issue thanks to channels like quick commerce. Profitability and unit economics take precedence—and there are fewer VC investors operating at this stage, said Dipanjan Basu, co-founder and partner at Fireside Ventures, an early-stage consumer fund.
The shift, however, is not limited to mid-stage companies.
“I think the switch is secular across stages. For instance, what we're seeing is that earlier, a ₹100 crore consumer brand would get funded easily. Today, that ₹100-200 crore range is a little bit of a tough spot. Above ₹200 crore, there are enough people looking to do a transaction, while below ₹100 crore, around the ₹50-60 crore range, people are willing to do a Series A. Earlier, that could have happened at, let's say, ₹25-30 crore. So, everything has almost doubled. Of course, there will be exceptions, but this is more the median,” said Shivakumar Ramaswami, founder & managing director at IndigoEdge, an investment banking firm.
Maturing bar
For investors, the rising thresholds reflect a D2C ecosystem where distribution is no longer the primary bottleneck.
“The threshold has effectively increased. I think that reflects the maturing ecosystem. Distribution has become much easier, and because of that, investors expect brands to demonstrate a higher level of traction before taking them seriously,” said Ujwal Sutaria, founding partner of early-stage VC firm TDV Partners.
The speed at which brands can now scale illustrates the change. Mint reported in June that D2C brands such as Beyond Appliances, Underneat, SuperYou and Palmonas had reached ₹100 crore in revenue in as little as 15 months, compared with the two to four years it previously took brands to achieve a similar scale.
But faster revenue growth does not necessarily translate into easier fundraising.
Revenue quality
Investors are increasingly assessing the quality and sustainability of that revenue, particularly as brands expand across channels.
“Real product-market fit is increasingly about what happens after the first purchase: are consumers coming back, are cohorts retaining, and is the brand able to grow within a channel rather than simply adding new channels? In that sense, what ₹1 crore of revenue signalled a few years ago may require ₹2-3 crore today. The benchmark has moved,” said Deepankur Malhotra, founder & managing partner at early stage VC firm Kairon Capital.
That is particularly relevant as brands turn to quick commerce for growth.
“Quick commerce is a great channel to have. You can use it to acquire users, but you have to build other channels as well. There should be some D2C, some offline distribution and some other channels apart from quick commerce. The platforms can also launch their own private labels. So, I would definitely consider 100% dependence on quick commerce a red flag,” said Aditya Singh, co-founder of an early-stage venture capital firm All In Capital.
The concern is not theoretical. Several quick commerce platforms are already building private labels of their own. Swiggy Instamart, for instance, has launched brands such as Noice, while Zepto has Relish and Daily Good, and Blinkit has Whole Farm.
For D2C brands, therefore, a rapid increase in sales through a single platform may not necessarily translate into durable competitive advantage. Investors are increasingly asking whether the brand can retain customers, grow across channels and defend its position as platforms themselves expand into private labels.
Bigger outcomes
Beyond revenue and product-market fit, investors are also becoming more conscious of the potential size of a business and the returns it can generate, particularly at later stages.
“Now investors are looking at the outcome and the theoretical cap of the brand. For instance, if you see that no brand becomes more than ₹1,000 crore in apparel, that’s the maximum I can underwrite. So, what should my entry price be to get a return? Therefore, what should my outcome be?” said Ramaswami of IndigoEdge.