Deep tech startups only received 11% of investments; they need more seed money, according to NASSCOM
- ByStartupStory | November 19, 2022
Only 11% of technology-related funds now reach this ecosystem, according to Debjani Ghosh, president of the National Association of Software and Services Companies (NASSCOM), who stated on Friday that India’s deep tech firms need more seed and early-stage capital to expand quicker. Startups in the field of new technologies such as artificial intelligence (AI), robots, quantum, blockchain, the Internet of Things (IoT), drones, and augmented reality are known as “deep tech” companies (AR).
Speaking at a workshop on “Startups and Entrepreneurship: Vision India@2047,” organized by the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce, Ghosh noted that, of the more than 25,000 tech startups nationwide, only 3,000 are devoted to deep technology, making up only 12% of all startups in this sector. Only 11% of all funding for technology-related projects goes to deep tech, she added, despite the fact that India has some exceptional deep tech businesses working across the entire spectrum of developing technologies.
According to her, nations like China and the United States are giving the deep tech startup ecosystem funding priority since it fosters innovation within those nations.
Ghosh emphasized that the deep tech startup environment is not comparable to the tech startup ecosystem due to the differences in their life cycles. Investors and regulators should be aware that deep tech businesses need more time to do research and innovate before they can enter the product market.
She proposed establishing a “startup service” similar to the conscription required by nations like Singapore. “Can we say in the third or fourth year of engineering (course), you (students) have to go and work one year in a tech startup? This would help tech startups access the best talent and compete for it with big companies,” the tech industry veteran said.
“The talent pool is there, but the problem is access to the talent,” Ghosh pointed out. “We have to move towards risk-based regulation,” she continued, stating that for the deep tech startup industry, talent and patents are absolutely essential. She claimed that India only has about 485 “truly inventive” deep tech startups and boldly proposed increasing this number to 10,000 by the end of this decade.
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