India’s deeptech sector has attracted close to $11.4 billion in PE-VC investment between 2015 and 2026 YTD, with 2025 emerging as the strongest year on record, according to the Bharat DeepTech Report 2026: From Lab to Leadership, released the Indian Venture and Alternate Capital Association (IVCA).

Key Highlights

• India’s DeepTech sector has attracted close to $11.4 billion in cumulative venture capital and private equity investment between 2015 and 2026 YTD, with 2025 the strongest year on record.
• AI/generative AI and Enterprise DeepTech/SaaS see the broadest investor participation, followed by spacetech and defence, while a structural Series B/C funding gap remains a key constraint to DeepTech scale-up.
• Only 15% of surveyed funds back technologies at the lab and proof-of-concept stage, while 40% have yet to engage with any government capital vehicle.

Commenting on the findings and the evolving deeptech investment landscape in India, Rajat Tandon, President, IVCA said, “India’s deeptech opportunity is moving from promise to more investible commitments, with an increasingly institutionalised ecosystem play. The growth in capital flowing into deeptech over the past decade reflects the confidence investors have in India’s scientific and technological capabilities. However, taking deeptech startups and entrepreneurs from the laboratory to global scale will require capital that is patient, appropriately structured, and available across the entire growth journey."

"Addressing the Series B/C funding gap, deepening domestic LP participation, improving exit pathways, and strengthening the policy and market ecosystem will be critical to building globally competitive deeptech companies from India. As the ecosystem evolves, closer alignment between founders, investors, institutions, and policymakers will be central to translating India’s scientific strength into sustained economic value", he added.

Deeptech Investment Is Gaining Ground

The study shows a sharp rise in private equity (PE) and venture capital (VC) activity in Indian deeptech since 2016, consistent with the global shift towards deep technologies. The sector has attracted close to $11.4 billion in cumulative PE-VC investment between 2015 and 2026 YTD; with 2025 as the strongest on record, even as funding slowed across the country’s broader startup ecosystem.

While AI/generative AI and EV and battery technologies attracted a significant share of the capital deployed, semiconductors and spacetech became the fastest-growing segments, reflecting a growing focus on strategic and industrial segments.

Over the past decade, Bengaluru continued to lead deeptech investments across India, bringing in around half of all deals and funding. At the same time, alternate hubs appear to be emerging in Ahmedabad, Kochi, and Kolkata, locations outside the established deeptech geography.

Investor Participation Grows, But the Series B/C Gap Remains

Findings from the IVCA DeepTech Fund Survey show that a large majority of the surveyed funds have been actively investing in deeptech, with participation highest in AI/generative AI and Enterprise DeepTech/SaaS, followed by spacetech and defence.

However, a structural Series B/C gap remains a major financial constraint. The survey found that fund participation declines sharply beyond the seed stage, and very few funds are able to write larger cheques for growth-stage companies. As a result, many funds operate shorter fund lives than the sector requires, creating a mismatch between fund structures and the time needed to develop and commercialise deep technologies.

Also Read: India Hits $5.2T Equity Market; Rs 1.76 L Cr IPOs in 2025- IVCA Report

Domestic Capital Anchors the Deeptech Investor Base

The report shows that while deeptech limited partners (LPs) in India are largely domestic players, spanning family offices, domestic institutions, and high-net-worth investors (HNIs), participation from global and corporate LPs is growing steadily. Looking ahead, a deeper and broader pool of domestic and global institutional capital will be a key enabler of growth and scale for India’s deeptech startup.

Expanding the investor base will require stronger and more predictable exit pathways, however, as exit visibility was identified as the single biggest challenge by the survey participants. Long gestation periods ranked as the second major challenge.

Nevertheless, the exit landscape has strengthened over the decade, with exit deal counts and values showing a notable rise in 2025, and secondary sales delivering the strongest average returns over the 10-year period, indicating potential for capital recycling as the market develops.

Policy Support and Access Will Shape the Next Phase

Currently, a range of government capital instruments are available to the deeptech ecosystem, including the Research, Development and Innovation (RDI) Scheme, SIDBI Startup India Fund of Funds 2.0, and the India Semiconductor Mission, among others. As per the study, although funds that have engaged with government co-investment schemes reported largely positive experiences, a considerable number are yet to tap into these vehicles. A gap in awareness of and access to available government support thus remains.

Commenting on policy priorities, the survey participants called for dedicated tax incentives and public procurement reform, which would create stronger investment pathways for investors and companies alike. The study also identifies five structural friction points across the capital pipeline, covering the journey from early-stage technology transfer through to exit, with illustrative policy actions mapped against each.

From Lab to Leadership

The report frames India’s deeptech ecosystem as a six-orbit system, connecting Talent, Startups, Investors, Limited Partners, Government and Policy, and Market and Exit. While India continues to trail mature markets in absolute deeptech funding, the rising share of deeptech in domestic VC-PE activity signals growing investor conviction. The study also highlights gaps across the capital journey. Only 15% of surveyed funds back technologies at the lab and proof-of-concept stage (TRL 1–3), pointing to a critical early-stage funding gap. At the same time, despite a growing pool of government capital and co-investment programmes, 40% of surveyed funds have yet to engage with any government capital vehicle, underscoring the need for stronger access and alignment between public and private capital.

Methodology

The report combines IVCA-Venture Intelligence deal data from 2015 to 2026 YTD with findings from the IVCA DeepTech Fund Survey 2026, covering 100 funds-52 institutional investors surveyed directly and data from 48 additional leading funds. The study examines investment activity, fund mandates, capital gaps, exit pathways, policy priorities, and the government and ecosystem architecture shaping India’s deeptech sector.