Eight US and Indian venture capital and private equity companies, including renowned investors Axel, Bloom Venture, Celesta Capital and Premji Invest, formed a rare coalition to support deep Indian tech startups, pledging over $1 billion to bolster US and India's technical ties over the next decade.
The alliance has addressed long-standing fundraising concerns. In April, Indian Commerce Minister Piyush Goyal elicited criticism after denounced domestic startups for focusing on food delivery instead of innovation, contrasting with Chinese companies in a presentation titled “India vs. China: Startup Reality Check.” Several investors and founders argued that India lacks capital for deep tech ventures, saying Goyal's comments overlook the founder's decision for the local market. The New Alliance appears to be addressing these concerns. It aims to guide long-term private capital, which many founders have struggled to secure funding in India, into deep technology ventures.
The move stands out as investors usually compete for deals rather than formally unite under an alliance called binding pledges. VCs often co-invest on a per transaction, but most cross-border collaborations occur informally through individual fund strategies rather than through coordinated capital blocks.
The group, known as India's Deep Tech Investment Alliance, brought together Celesta Capital, Accel, Blume Ventures, Gaja Capital, IdeasPring Capital, Premji Invest, Tenacity Ventures and Venture Catalysts, said in a joint statement on Tuesday. The launch was announced earlier this year in the national budget, following the Indian government's approval of a pound (approximately $11 billion) of research, development and innovation (RDI) scheme, to boost Deeptech R&D.
Under the alliance, each member will violate private capital for a period of five to ten years against India-dominated deep tech startups, the corporation said. For now, there are relatively few such companies, as many of India's most well-known deep tech ventures with Indian founders, are incorporated into the US, but New Delhi has made local incorporation a requirement for incentives under the new RDI scheme.
In addition to fundraising, members provide mentorship and network access. The company is also planning to use the Alliance to help portfolio companies expand into the Indian market.
“This is in line with the strategic interests of both India and the US at the government level and focuses on important and emerging technologies,” said Arunkumar, Celesta Capital Managing Partner, who will be the alliance's first chair in an interview.
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Still, the geopolitical background is complicated. In February, President Donald Trump and Prime Minister Narendra Modi launched the Trust (Using Strategic Technology to Transform Relations) initiative to deepen technological ties between the US and India. However, the relationship quickly showed tension. Last month, Trump imposed a 50% tariff on Indian goods on the ongoing purchase of Russian oil in New Delhi, so analysts in the move say they placed the two leaders on the opposite side of a wide range of trade and geopolitical rifts.
Despite these tensions, the alliance is betting on India as a hub for startups developing basic technologies such as AI, semiconductors, space, quantum, robotics, biotechnology, energy and climate technology, despite the geopolitical rift between the two leaders.
“We believe that India is a particularly interesting market, not just the new company opportunities that have started in India, but also the opportunity that exists for US companies looking to expand into the Indian market,” Sriram Vishwanathan, founding and managing partner of Celesta Capital, told TechCrunch.
CELESTA CAPITAL – Early supporters of Indian startups such as space technology venture Agnikul, drone maker Ideas Forge and AI-led cancer diagnostics company OneCell Diagnosis – led the effort after discussions between industry stakeholders and the Indian government.
“We put this together and actually activate the ecosystem and bring together like-minded investors,” Vishwanathan said.
The Alliance focuses on early stage startups from seed to Series B, avoiding late stage investments, Vishwanathan pointed out. He also said that the commitment of over $1 billion is just the beginning, as “a long journey begins with the first step.”
“We can expect more companies to join this alliance, both financial VC companies and private equity companies,” he said. “We also need to expect companies with fairly important investment programs to participate.”
The Alliance does not set its own eligibility criteria for new members, but Vishwanathan said participants must meet the terms of the Government of India under the RDI scheme.
“Alliances are just a platform for engaging with the government,” he told TechCrunch.
As a group, investors in the Alliance are planning to engage with the Indian government on policies and incentives to advance the interests of private industry and act as a unified voice, Vishwanathan said.
In the past, changes in regulations deployed without industry opinions have caused confusion in India. Some of such moves have attracted intense criticism from US investors and then retreated after widespread rage.
Alliance members will voluntarily share information and coordinate pipeline development, due diligence and co-investment opportunities, the company said.
The advisory committee, composed of early participants, consisting of representatives from Accel, Premji Invest, and Venture Catalysts, establishes shared goals and ensures coordination while maintaining the independence of each fund.
Kumar said the alliance's leadership will spin as it moves forward while he is the first chair.
The alliance could prove a double-edged sword for Indian deep tech startups. Pooling long-term capital and giving government a unified voice appears to be a boon, but there is a risk when coordination sways and promising companies get caught up in the gaps.
“In the next decade, startups will be built in India and export breakthrough solutions to the world. The tailwinds are in place: ambition, talent, policy intentions, patient capital.”