When the going gets tough, the tough get innovating.It is widely understood that 2016 has not been an easy year for startups in the country. With investors looking for a roadmap towards profitability, startups have found out that raising funds is not going to be easy. Profligacy is scorned upon and startups have realized it is time to perform or perish.When we set out to do the half-yearly series on "State of Startups", the idea was to find the top funded companies in the last six months. The assumption was that these startups must be doing something right to have raised funds in a tough environment. We partnered with the good folks at Tracxn to draw up this list.In the journey of every startup, there is a moment when the penny drops and it is clear from the stories that the top funded startups are at a very interesting phase of their lives. Innovation and doing something out of the box is the common thread between all of them. Although, it is not really a startup, Ibibo is a part of our list primarily because what it does has repercussions for the entire startup ecosystem. Ibibo tops our list as the top funded company with its parent Naspers pouring $250 million in investment.However, it is exciting to see what Ibibo is building. The company is giving structure to a platform where a traveler will have to merely enter the "From" and "To" fields and it will present all possible forms of transport combinations. From flights, bus, train to cabs, Ibibo will enable a traveler to book his or her journey using multiple modes of travel across any place in India with the click of a button. Snapdeal is second on our list with the ecommerce major raising $200 million in a round led by the Ontario Teachers' Pension plan. Big Basket takes the third spot with a $150 million funding round. Online grocery startups have not had it easy, but Big Basket has bucked the trend. Cofounder Vipul Parekh says it can be attributed largely to its business model, which is different from what others in the space followed.The tide may have turned for many startups after the euphoria of 2015, but as CarTrade demonstrates, the tap has not run dry for them. With $145 million in funding, the startup is betting big in one of the largest automobile market in the world. Similarly, Byju's with 75 million is excited about making a mark in the hugely lucrative, but difficult ed-tech market. Lenskart, which is sixth on our list, has come up with an eye testing equipment that has combined three machines into one and reduced the weight from 15 kgs to less than 2 kgs. Inside a shock proof case that can be dropped from the 20th floor. Lenskart will now use this machine for its home service programme.There is no end to ambition for some startups. Mobikwik wants to provide all financial services on its app -- from loans to investing and Droom wants to create the largest repository of vehicle information in India. Lendingkart has huge plans in the alternative finance space, while Nestaway wants to re-imagine the online realty space.It is clear in our mid-year review that for ingenuity and innovation, there is always money available. Run-of-the mill ideas will find it difficult to find money. In fact, the first six months of the year has seen the second highest fundraising in a seed round with Melorra bagging $5 million. With its 3D printing jewellery that looks to cater to the everyday needs of urban women, Melorra has a huge opportunity to tap. In this backdrop, India's smartest investor Pankaj Jain rightly says, "When things slow down, good things happen too."a)- Q1 2016 has seen about 60% increase in the number of funding rounds compared to Q1 2015. Further, the number of rounds in Q2 2016 is in the same range compared to Q2 2015 - highlighting that investors are continuing to bet on the Indian Startup ecosystem.b)- 2016 has seen a higher level of activity at seed stage level, highlighted by the increase in the proportion of seed stage rounds in Q1 2016 (76%) compared to Q1 2015 (58%).c)- Q2 2016 has seen a big drop in the amount invested compared to Q2 2015 (based on disclosed rounds), primarily due to a 75% drop in late stage funding in Q2 2016 compared to Q2 2015. One key contributing factor for the drop in late-stage funding in Q2 2016 is due to the absence of any marquee funding rounds (investments > $100M) in Q2 2016.d)- In Q2 2015, three marquee rounds accounted for $680M investments. Global investors such as Tiger Global and Steadview Capital who were involved in multiple marquee rounds in 2015 have stayed away from big investment rounds in 2016.Traditionally, the third quarter of the year is the most significant in terms of investing and there are signs that things are picking up. Big investment like the one seen by Bookmyshow.com is a testament that the third quarter has the potential to be a good one. Another startup on our list, Byju's has made it public that they would be raising another $50 million. This would mean over $100 million in investment this year for the startup. As the focus on top line and cost control increases, our annual review for 2016 promises to be very interesting.However, what is certain is that the bad news in the forms of layoffs and companies shutting down would continue to hit the headlines. The scorching pace of indiscriminatory funding seen in 2015 has come back to haunt many startups and we are also likely to see consolidation in the startup space. The game is on, but the number of players may reduce.We will be back with our annual list in 2017!