Deeptech to account for up to one-third of VC funding in India: Accel's Prashanth Prakash
Deeptech could account for as much as a third of venture capital (VC) allocations in India over the next two to three years, said Prashanth Prakash, partner at Accel.
“Deeptech is currently about 10-15% in many funds. I predict it will rise to about 25-30% and be as big as consumer tech or fintech in the next two to three years. The wellness and longevity category is still very nascent," he added while speaking at a panel discussion at the Bengaluru Tech Summit on Tuesday.
Prakash added that investors are also adapting to the nature of the sector. “Deeptech entrepreneurs are not only going to write software. There is physicality, hardware, and manufacturing capex. Teams need multidisciplinary capabilities. Investors must assess whether founders want to do this for the next 10-15 years,” pointed out the venture capitalist, who had made early bets in Flipkart, Slack, Myntra, and Redbus.
Dhinesh Kanagaraj, founder of hardware startup Fabheads Automation, spoke on how, as the ecosystem scales, deeptech companies would need to focus on "problem definition and defensibility."
“Product-market fit is still central. Detailed IP studies are critical. IP (intellectual property) protection also varies by geography; something patentable in Europe may not be patentable in India. That affects moat construction. You must look closely at geographic IP strength and commercial defensibility,” he said.
“Deeptech is currently about 10-15% in many funds. I predict it will rise to about 25-30% and be as big as consumer tech or fintech in the next two to three years. The wellness and longevity category is still very nascent," he added while speaking at a panel discussion at the Bengaluru Tech Summit on Tuesday.
Prakash added that investors are also adapting to the nature of the sector. “Deeptech entrepreneurs are not only going to write software. There is physicality, hardware, and manufacturing capex. Teams need multidisciplinary capabilities. Investors must assess whether founders want to do this for the next 10-15 years,” pointed out the venture capitalist, who had made early bets in Flipkart, Slack, Myntra, and Redbus.
Dhinesh Kanagaraj, founder of hardware startup Fabheads Automation, spoke on how, as the ecosystem scales, deeptech companies would need to focus on "problem definition and defensibility."
“Product-market fit is still central. Detailed IP studies are critical. IP (intellectual property) protection also varies by geography; something patentable in Europe may not be patentable in India. That affects moat construction. You must look closely at geographic IP strength and commercial defensibility,” he said.
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