India is poised to see its first unicorns in advanced manufacturing within the next three to four years, according to Accel partners Prashanth Prakash and Prayank Swaroop.
Why it matters: This shift in the venture capital landscape indicates a growing interest in supporting companies in asset-heavy, complex sectors such as defense, robotics, semiconductors, and aerospace.
The details:
- VCs are increasingly willing to invest in these sectors, no longer viewing them as old-world, asset-heavy businesses.
- The growing interest among founders, government support, and a maturing domestic market have created the right conditions for companies to succeed in deep tech.
- India’s next wave of successful startups will likely be defined by proprietary intellectual property (IP) and engineering-led innovation rather than consumer scale.
- Accel has launched a new initiative, Atoms for X, aimed at scouting early-stage ventures in robotics, industrial AI, defense technology, and more.
Increased global demand for diversified supply chains, rising interest in sovereign technologies, and greater IP development within India’s universities and startups indicate that the deep tech ecosystem is ready to scale.
What they’re saying:
- “There is something that shifted in the last six to nine months where VCs don’t seem to be viewing these as old-world, asset-heavy businesses anymore,” said Prashanth Prakash.
- “We believe the next unicorns will come from areas like defense and aerospace. Some of them are already on the path,” added Prayank Swaroop.
“Once deep tech companies reach the market, they can achieve profitability much faster,” Prakash noted, despite the perception that these companies burn more capital.
The bottomline: Accel’s partners are optimistic that India is on the brink of a significant transformation in its startup ecosystem, pivoting from consumer-centric models to ones that prioritize technological innovation and advanced manufacturing capabilities.
