Accel and Prosus Join Forces to Fund Early-Stage Indian Startups
- ByStartupStory | October 28, 2025
Global venture capital giant Accel and European technology investor Prosus have announced a groundbreaking partnership to co-invest in early-stage startups in India. This alliance marks Prosus’ first foray into formation-stage investing in the Indian market. The two firms aim to back startups addressing large-scale, systemic challenges across sectors such as automation, energy transition, internet services, and manufacturing.
Expanding the Early-Stage Investment Ecosystem
The collaboration expands Accel’s early-stage founder program Atoms X, launched in July 2025, which focuses on so-called “leap tech” startups—companies leveraging deep technology and engineering breakthroughs at scale to solve pressing societal challenges.
Unlike traditional venture capital models that often invest at later stages, this partnership aims to empower startups right from their inception, providing critical early capital, mentorship, and strategic support. Under the arrangement, Prosus will match Accel’s investments in each startup, with initial funding rounds ranging from $100,000 to $1 million per company.
Addressing India’s Unique Challenges with Local Innovation
India’s dynamic startup ecosystem, bolstered by over a billion internet users and more than 700 million smartphone users, is among the fastest growing worldwide. Government initiatives such as Unified Payments Interface (UPI) and Aadhaar have created a robust digital infrastructure, enabling startups to rapidly prototype and scale services.
However, much of the Indian startup activity to date has revolved around adapting global business models rather than building homegrown solutions for India’s unique challenges. Accel and Prosus seek to change this narrative by focusing on startups innovating from “first principles” that can help India leapfrog traditional development pathways.
Pratik Agarwal, partner at Accel, said, “We believe the time is right for startups in India to move from incremental innovations to bold, systemic problem-solving. Our partnership with Prosus will provide the capital and conviction needed to fuel this leap.”
Combining Early-Stage Discipline with Long-Term Capital
Prosus, traditionally focused on growth-stage and late-stage investments, views this partnership as a strategic expansion of its footprint into earlier stages of the startup lifecycle in India.
Ashutosh Sharma, head of India ecosystem at Prosus, noted, “This is a unique partnership globally. By combining Accel’s early-stage expertise and founder program with our access to patient capital and global markets, we can empower visionary entrepreneurs solving India’s toughest problems.”
By providing startups a “single cheque” investment solution, Accel and Prosus aim to reduce friction and confusion during fundraising, enabling founders to focus on product development and scaling.
Focus Sectors and Impact Areas
Target sectors include internet-led businesses, AI-driven automation, advanced manufacturing, and clean energy transitions—areas critical to India’s sustainable economic growth.
This initiative is expected to support startups developing large-scale societal impact, addressing challenges ranging from improving infrastructure, driving digital inclusion, enabling cleaner industrial processes, to revolutionizing healthcare and education through technology.
A Response to Changing Venture Investment Climate
India’s venture capital funding experienced a contraction in early 2025, with total investments dropping by 25% to $4.8 billion in the first half. In this context, the Accel-Prosus partnership sends a strong signal of long-term confidence in India’s deep tech potential, especially at the often underfunded early stages.
Early-stage startups frequently face a funding gap because of higher risks and longer timelines before achieving significant traction. The partnership’s willingness to invest at formation and seed stages hopes to bridge this gap and catalyze innovation pipelines.
Looking Forward
Since launching Atoms X in July, Accel has backed over 40 startups, with more than 30% already securing follow-on investments. This expanded collaboration with Prosus is expected to enhance deal flow, combine networks, and offer a more comprehensive support system for Indian entrepreneurs.
For India’s tech ecosystem, the partnership represents a maturing of the investment landscape—moving beyond mere global adaptation to fostering indigenous innovation designed specifically for Indian realities and scale.
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