Tushar Kansal,
Founder & CEO, ,
Kansaltancy Ventures,
When you’ve advised over 400 Startups and SMEs across 70+ countries, you get a front-row seat to the evolution of Technology and markets – It also gives you a unique perspective on how Markets and Technology are developing. I've witnessed industries shift, business models come and go, and capital cycles fluctuate. A different kind of founder, however, has surfaced in recent years; they are quiet, focused on research, and developing technologies that aren't popular on social media. The DeepTech entrepreneurs are these people.
DeepTech isn't about making quick money. Long-term planning and patient capital are key. Although it's still in its infancy, India has a lot of potential.
Consider the example of Quantum Computing. Around the world, the race is intensifying. In 2019, Google asserted that their Quantum machine had solved a problem that would have taken a traditional computer 10,000 years, in just 200 seconds. Despite ongoing discussions about Quantum supremacy, one thing is certain: a new paradigm is taking shape!
India is not sitting idle. With a budget of ₹6,000+ crore (about $730 million), the government started the National Quantum Mission in early 2023 with the goal of creating Quantum computers with up to 1,000 physical qubits by 2031. This involves leapfrogging rather than merely catching up to the West.
Actual research on photonic qubits, superconducting materials, and quantum sensors is underway at IIT Madras, IISER Pune, TIFR, and CDAC. The intention is present. What is missing is a more robust link between Laboratory research and Commercial implementation. VCs like me can help with that.
I've worked with Startups in the last year that are working on Hybrid Quantum-Classical algorithms for Pharmaceutical simulations, Quantum ML for Asset pricing, and Quantum-safe Cryptography. A Team from Bangalore is collaborating with foreign Labs to speed up Drug discovery by simulating Protein folding. For BFSI companies, another Pune-based Startup is developing Lattice-based Encryption solutions.
It's not your typical 12-month Product-Market-Fit (PMF) narrative. These are marathons that last ten years! And that calls for a different kind of Capital one that is patient, extremely technical, and prepared to withstand risks related to ecosystems and regulations.
Let's now discuss Semiconductors. The annual cost of India's reliance on imported chips exceeds $15 billion. And the dangers of that dependence were made clear by the Pandemic. The response from the Indian Government was prompt. The creation of a Fab ecosystem, partnerships with companies like TSMC and Micron, and the $10 billion Semiconductor incentive package are all positive moves.
Micron, for instance, is setting up a $2.75 billion assembly and testing plant in Gujarat, expected to create over 5,000 direct jobs. This is more than a factory. It’s an Anchor around which design and fabrication Startups can cluster.
Design-linked incentives (DLI) are encouraging Fabless startups. A few I’ve evaluated are working on Analog chips for IoT and specialized processors for automotive and drones. One Delhi-based Startup has developed an ultra-low power RISC-V based chipset designed for wearable healthcare devices. They’re already talking to Taiwanese foundries for manufacturing.
But Semiconductors are not just about Fabs. They’re about design, supply chains, IP protection, and scale. We need Indian VCs to understand these nuances. Most importantly, we need to look beyond short-term exits - National security, Energy independence and Strategic leverage are at stake.
Artificial Intelligence is another area of rising activity. But we must move beyond ChatBot clones. The real Gold lies in sector-specific AI solutions. Startups in India are now building LLMs trained on Legal, Medical and Agricultural datasets. These vertical LLMs are leaner, cheaper, and far more useful than general-purpose models. Some time ago, the CEO of TCS was asked when will TCS build LLM’s in Indian vernacular languages – he replied that it is too costly and not required! But the Indian Government stepped in and has chosen Sarvam AI as the Startup which will build our own LLM!
In AgriTech, a Hyderabad-based Startup is using Satellite imagery and AI to predict Crop Health and Irrigation needs with 85%+ accuracy. This isn’t glamorous Tech, but it’s transforming the economics of farming.
My extensive association with Entrepreneurship-Development Cells at IIT’s, including at Delhi, Mumbai, Chennai, Lucknow and Ropar, has made me see first-hand, the focus with which India’s Startups are building the future of Tech!
On the Edge computing side, a Mumbai Startup is building on-device AI accelerators for smart CCTV cameras, enabling real-time threat detection without cloud dependency. It’s an excellent example of solving for Indian infrastructure constraints!
Then there’s Energy Tech. India added 15 GW of renewable capacity in 2023 alone, and the government has committed to 500 GW of non-fossil fuel capacity by 2030. But the real bottleneck is storage.
Battery Tech is seeing exciting innovation. I have worked with a Noida-based Startup working on Sodium-ion batteries using Indian raw materials, bringing down costs by 30% over Lithium. Another one in Pune is experimenting with solid-state storage for EVs, claiming a 500+ km range on a 15-minute charge. These are early-stage bets, but if they crack scale, the export potential is enormous.
The same goes for Green Hydrogen. With the National Green Hydrogen Mission pumping in ₸19,700 crore ($2.3 billion), Startups are experimenting with Electrolysis Tech suited for Indian Climatic and Grid conditions. Some are partnering with Public Sector Units for pilot deployments.
Investors need to understand that these are not SaaS plays. You can’t A/B Test your way to Product-Market Fit. You need Lab results, certifications, and partnerships with Government or Heavy industry.
Another interesting segment is Space Tech. India saw 140+ Space Startups by the end of 2023. The likes of Skyroot, Agnikul, and Pixxel have validated private sector capability. But now we need to go deeper: propulsion systems, synthetic aperture radars space debris tracking and much more.
One Chennai-based Startup I’m tracking, is building reusable rocket engines using additive manufacturing. They’re not just dreaming big; they’re testing with ISRO. That’s what makes Indian space tech unique access to a strong state ecosystem. The Indian Government asked ISRO to share Tech and its Infra with Private players and that has given wings to the Indian Private Space Startups!
Of course, DeepTech investing in India comes with brutal timelines. No 10x in 12 months here. We’re talking about companies that may take 5 years just to reach pilot revenues. But I’d rather be early in something hard than late in something easy!
We also need more than Capital. We need Translational Research Centers, better Lab-to-Market programs, IP awareness, and Testbeds. Founders need to know how to pitch to Engineers, Policymakers, Investors and not just VCs.
To Fellow Investors: If your fund has a 5-7-year horizon and you’re looking for predictable growth, DeepTech might not be your game. But if you’re willing to invest in Knowledge, Talent, and Resilience - Welcome aboard.
To Founders: Stay close to the Lab, Work with Academic collaborators, File Patents, Focus on Depth over Speed. And Yes! - Be Stubborn. The market will catch up.
To Policymakers: We need continuity in schemes. DeepTech founders can’t plan around Budget cycles. Let’s build multi-decade missions like ISRO. Let’s give Indian minds the support they need to invent at home!
Drawing from advising over 400 Startups and SMEs across 70+ countries, several key lessons emerge:
In conclusion, DeepTech is not a speculative bet. It is a necessity. It’s how India ensures economic resilience, national security, and global relevance. And while exits may take time, the value created will be far greater than just financial returns.
The next decade belongs to founders building for complexity, not convenience. As a Venture Capitalist, I’m placing my bets on them.
Not just for returns but for relevance.
The Journey Into Industry
Tushar Kansal is the Founder & CEO of Kansaltancy Ventures – www.Kansaltancy.com, a network of Investors including Venture Capital (VC) Funds, Family Offices, IPO Anchor Investors and Institutional Lenders. He has delivered 500+ Talks/ Shows across Ivy-League academia and Corporates globally, all of which are available in the Public domain - Check TedX/ Google/ YouTube/ Spotify/ LinkedIn. His expert opinion is often sought by leading Channels/ Publications like CNN-News18, VCTV (Venture Capital Tv), Business World & TechThirsty. He contributes to a Portfolio of 400+ Investments in 70+ countries as a Venture Advisor with Loyal VC, a Canadian VC Fund. Awarded multiple times, Tushar is on a mission to assist 25,000 Startups/ SME’s with Funding/ Investments, Management Knowhow and through the network of Kansaltancy Ventures. He is a partner with the biggest Anchor Investor in the SME IPO space, with investments in 115+ IPO’s & AUM of $2.7 Billion.
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