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DeepTech: Closed-door Policy Roundtable on DeepTech Fund
DeepTech: Closed-door Policy Roundtable on DeepTech Fund

May 5, 2025

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On April 3, we organised a closed-door roundtable discussion on the sidelines of Startup Mahakumbh 2025, on creating a truly world class accelerator program for DeepTech start-ups in India. The roundtable comprised key government officials from MeitY, DST, BIRAC, PSA office and investors including IAN Alpha Fund, Peak XV, SEA Fund, GrowX Venture, and Bharat Innovation Fund. The focus of the discussions was to build upon the Union Budget 2025’s allocation of ₹20,000 crore, focusing on operationalising funding and strengthening India’s innovation ecosystem.

Some of the key takeaways of the discussion are as follows:

  1. Public funds should be channelled into innovations with credible scientific validation, while still early enough in their lifecycle to require significant growth capital. Accordingly:
  • Startups should demonstrate that they have reached Technology Readiness Level (TRL) 5 or higher.
  • A Techno-Commercial Readiness & Market Maturity Matrix developed by NITI Aayog could be referenced for evaluating the start-ups.
  1. Start-ups could be identified into two tracks – first, Commercial Segment (EV batteries, space technology, biotech, and selective AI) and second, Strategic Segment (Defence tech, Agri-biotech, Vaccines, Quantum computing, and Climate materials).
  2. Focussed Acceleration Program should be designed for high potential eligible DeepTech start-ups. For identifying this pool, a panel of external experts with proven expertise in technology, investment, and relevant industries may be constituted.
  3. While formulating the modalities of the fund it may be kept in view that 80% of the DeepTech deals happen at the seed stage, indicating an asymmetry in the investment pipeline and nascency of the sector. While the average seed funding size of Indian DeepTech has increased it remains at ~ 50% of global average. Investment ticket sizes should range between ₹50–200 crore to match global standards and cater to the capital-intensive needs of DeepTech startups.
  4. DST funding should bridge the funding vacuum between seed and Series C by keeping a vigilant eye on Series A and B investments—phases often underserved by current schemes.
  5. The government should have an additional goal to deploy funds to establish and nurture approximately 10 world-class academic incubators.
  6. Beyond the funds earmarked for investments into the start-ups (say the Rs 5000 crore from DST and the Rs 2000 crore from MEITY) government should have an additional goal  to deploy funds to establish and nurture approximately 10 world-class academic incubators
  7. Investment should be routed through SEBI-registered Alternate Investment Funds (AIFs), which must be mandated to invest a significant share in DeepTech startups. Some flexibility may be allowed for adjacent or non-DeepTech sectors to ensure financial sustainability and risk mitigation.
  8. The DeepTech FoF should act as an anchor investor by deploying capital upfront to instil confidence among private venture capitalists.
  9. Co-investment structures for direct investment alongside private investors in selected DeepTech startups should be enabled.

Please refer to the attachment to read the detailed outcome report. For further information, please write to swapnil@nasscom.in with a copy to policy@nasscom.in.

 

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20250414_Meeting Report - Policy Roundtable for DeepTech Accelerator 3rd April 2025.pdf

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