Nepal Startup Ecosystem in 2025: A Year of Resilience and Transformation

Posted On 24 January, 2025

Nepal, nestled in the Himalayas, has emerged as a growing hub for entrepreneurial innovation and technological advancement. Despite challenges stemming from geographical constraints, limited resources, and economic hurdles, the country’s startup ecosystem has shown remarkable resilience. Over the past decade, Nepal has transitioned from a largely traditional economy to one that embraces digital transformation, sustainability, and innovation. In 2024, Nepal’s startup ecosystem achieved significant milestones in sectors like fintech, agritech, tourism tech, and renewable energy, supported by increasing government initiatives, international collaborations, and a burgeoning entrepreneurial spirit. As we step into 2025, Nepal stands poised to further strengthen its position as a regional hub for innovation and sustainability.

Record-Breaking Funding in 2024

Nepalese startups raised $120 million in 2024, a 50% increase from the previous year. Kathmandu, the nation’s capital, remained the epicenter of startup activity, while cities like Pokhara, Lalitpur, and Biratnagar also gained recognition as emerging hubs for tourism tech, agritech, and fintech.

The surge in funding was driven by early-stage investments, which grew by 60%, reflecting increased investor confidence in Nepal’s entrepreneurial potential. Notable funding rounds included $20 million for a fintech platform improving digital payment access, $15 million for an agritech startup focused on smart farming solutions, and $12 million for a tourism tech company promoting eco-tourism.

Government programs such as the Startup Nepal Initiative, the Youth and Small Entrepreneur Self-Employment Fund, and support from organizations like the World Bank and Asian Development Bank have been pivotal in fostering growth.

Fintech: Driving Financial Inclusion in a Cash-Dependent Economy

Fintech has emerged as a cornerstone of Nepal’s startup ecosystem, with startups in this sector raising $40 million in 2024. Given that a significant portion of the population remains unbanked, fintech startups are providing critical solutions to bridge financial gaps through mobile banking, digital wallets, and micro-loan platforms.

Leading players like eSewa, a digital wallet, and Fonepay, a QR-based payment gateway, continued to dominate the market. Emerging startups like Khalti, an online payment solution, and LoanBee, a micro-lending platform for small businesses, gained traction. Regulatory support from the Nepal Rastra Bank (NRB) and initiatives under the Digital Nepal Framework have been instrumental in enabling fintech innovation.

Agritech: Modernizing Agriculture Through Innovation

Agritech startups raised $30 million in 2024, leveraging AI, IoT, and blockchain to address challenges in food security, water management, and market access. Agriculture, which employs over 60% of Nepal’s workforce, remains a critical sector for innovation.

Notable startups like Krishi Guru, providing farmers with real-time agricultural advice, and Smart Krishi, an app offering market price updates and weather forecasts, are empowering smallholder farmers. Companies like GreenGrow, specializing in organic farming, and AgroTrade Nepal, connecting farmers to urban markets, are addressing systemic inefficiencies. Government support under the National Agriculture Development Strategy (ADS) has further bolstered this sector.

Tourism Tech: Revitalizing Nepal’s Key Industry

Tourism tech startups raised $25 million in 2024, leveraging digital platforms to enhance travel experiences and promote Nepal’s natural and cultural heritage. Tourism, a key contributor to Nepal’s GDP, has seen a resurgence post-pandemic, driven by innovation in eco-tourism and adventure travel.

Companies like Trekking Mate, a platform for customized trekking packages, and Visit Nepal, focusing on eco-tourism, are redefining the sector. Emerging startups like Yeti Tours, integrating local cultural experiences, and Himalayan Trails, offering AR/VR trekking experiences, gained significant traction. Investments under the Visit Nepal Decade 2023–2033 Initiative have supported the sector’s recovery and growth.

Green Tech: Leveraging Nepal’s Renewable Energy Potential

Green tech startups raised $15 million in 2024, focusing on renewable energy, waste management, and climate-resilient infrastructure. Nepal’s abundance of hydropower resources and its vulnerability to climate change have spurred innovation in sustainable energy solutions.

Key players like HydroNepal, specializing in small-scale hydropower projects, and CleanTech Nepal, focusing on solar energy solutions, are driving the sector. Startups like BioGas Nepal, which converts organic waste into energy, and GreenBuild, promoting eco-friendly construction materials, are gaining recognition. Government policies under the National Renewable Energy Program and international partnerships have fostered growth in this sector.

Healthtech: Improving Accessibility in Rural Areas

Healthtech startups in Nepal raised $10 million in 2024, focusing on telemedicine, mobile healthcare solutions, and digital health platforms. With vast rural areas and limited healthcare infrastructure, healthtech innovation is addressing critical gaps.

Startups like TeleDoc Nepal, a telemedicine platform, and HealthNet, providing virtual consultations, are transforming healthcare delivery. Companies like PharmaHub, an online pharmacy, and MediTrack, offering digital health records, are gaining traction. Investments under the Universal Health Coverage Strategy and government incentives for digital health solutions have bolstered the sector.

E-Commerce and Logistics: Bridging Urban and Rural Markets

E-commerce and logistics startups in Nepal raised $8 million in 2024, driven by the rapid adoption of online shopping and increasing smartphone penetration.

Companies like Daraz Nepal, an online marketplace, and Pathao, a ride-hailing and delivery platform, continued to dominate the market. Emerging startups like Mero Shopping, focusing on rural e-commerce, and NepXpress, providing last-mile delivery solutions, are addressing supply chain challenges. Investments under the Digital Nepal Framework have enabled startups to scale and improve accessibility.

Artificial Intelligence: Enabling Smart Solutions Across Sectors

AI startups in Nepal raised $7 million in 2024, with applications in agriculture, healthcare, and customer engagement. Nepal’s growing focus on STEM education and partnerships with tech giants have supported the rise of AI-driven solutions.

Notable startups like DataSense Nepal, providing predictive analytics for businesses, and Vision AI Labs, specializing in computer vision applications for agriculture, are leading the sector. Government support through the National AI Strategy and collaborations with global tech companies have strengthened Nepal’s position in AI innovation.

Digital Infrastructure and Smart Cities

Nepal achieved significant progress in digital infrastructure in 2024, including expanded broadband access to rural areas and the rollout of 4G and 5G networks. These advancements have enabled startups to innovate in IoT, cloud computing, and smart city solutions.

Kathmandu and Pokhara are implementing smart city initiatives focusing on AI-driven traffic management, renewable energy integration, and digital public services. Programs like Smart City Nepal 2025 have positioned the country as a leader in digital transformation in the region.

Global Collaborations and Market Expansion

Nepalese startups increasingly entered international markets in 2024, with over 15 companies establishing a presence in South Asia and Southeast Asia. Initiatives like Startup Exchange Nepal and partnerships with accelerators such as Seedstars and Impact Hub Kathmandu have facilitated cross-border collaborations.

Nepal’s strategic location and growing innovation ecosystem have made it an attractive destination for international investors and a launchpad for regional expansion.

Mergers and Acquisitions (M&A): Strengthening the Ecosystem

M&A activity in Nepal reached new heights in 2024, with 5 deals valued at $15 million. Startups in fintech, agritech, and tourism tech were the primary targets for acquisitions by regional and global corporations.

A notable deal included the acquisition of a Nepalese tourism tech platform by a multinational travel company, highlighting the ecosystem’s growing relevance.

Employment and Talent Development

Nepalese startups created over 5,000 new jobs in 2024, with strong demand for professionals in fintech, AI, and healthtech. Collaborations between startups and universities, along with government programs like the Skill Nepal Initiative, have ensured a steady pipeline of skilled talent.

Investments in digital education and upskilling initiatives have empowered local professionals and attracted international talent to the ecosystem.

Challenges and Opportunities

Despite its progress, Nepal’s startup ecosystem faces challenges such as limited access to late-stage funding, regulatory hurdles, and rural infrastructure gaps. However, opportunities lie in leveraging its young population, strategic location, and growing digital economy. Emerging sectors like agritech, green tech, and tourism tech are poised to drive the next wave of growth.

The government’s commitment to fostering innovation, sustainability, and economic diversification will be critical in addressing these challenges and sustaining momentum in 2025.

Looking Ahead to 2025

As Nepal’s startup ecosystem advances into 2025, it is poised for continued growth and recognition in the South Asian region. Key focus areas include scaling fintech and tourism tech solutions, advancing agritech technologies, and fostering deeper international collaborations.

With its strong commitment to sustainability, digital transformation, and entrepreneurship, Nepal is well-positioned to become a leading innovation hub in South Asia.

The Nepalese startup ecosystem in 2025 exemplifies resilience, creativity, and transformation. By leveraging its strengths in technology, sustainability, and international collaboration, Nepal is shaping its future as a leader in the global innovation landscape. Startups in the country are not only addressing local challenges but are also paving the way for a sustainable and prosperous future for South Asia and beyond.