Piper Serica, a Mumbai-based asset management firm, has announced the launch of its latest venture capital fund, the Bharat Tech Fund, targeting deeptech startups in India with a potential size of ₹800 crore. Aimed at supporting Series A and B stage companies, this fund seeks to invest in sectors such as semiconductors, spacetech, defence tech, and fintech infrastructure. This move reflects a growing interest in deeptech, an area gaining traction due to its transformative potential across industries.
### Piper Serica’s Strategic Investment Approach
Founded in 2003 by Abhay Agarwal, Piper Serica has positioned itself as a key player in India’s venture capital landscape. The Bharat Tech Fund, classified as a Category II Alternative Investment Fund (AIF), sets a target corpus of ₹600 crore with a greenshoe option of an additional ₹200 crore. The firm plans to make individual investments averaging between ₹25 crore to ₹50 crore, aiming for a gross internal rate of return (IRR) of approximately 30% over a six-year period.
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Piper Serica’s investment strategy involves collaboration with premier institutions like IIT Madras, IIT Delhi, IIT Bombay, IISc Bangalore, and government innovation platforms. These partnerships are pivotal in identifying startups with groundbreaking technologies. The firm’s proprietary AI tool, Yoda.ai, further refines the selection process, ensuring that investments are both innovative and commercially viable.
### The Deeptech Ecosystem and Funding Landscape
The launch of Bharat Tech Fund aligns with a broader trend in the Indian startup ecosystem, where deeptech is emerging as a significant focus area. The Indian government has been actively promoting this sector by easing regulatory frameworks and offering financial incentives. Recent policy changes have extended the qualification timeline for deeptech entities to 20 years and increased the turnover threshold to ₹300 crore, enhancing the attractiveness of deeptech startups for investors.
The government’s Startup India Fund of Funds (FoF) scheme, with a corpus of ₹10,000 crore, emphasizes deeptech as a central theme, supporting AIFs that invest in startups requiring extensive research and development. This policy support, combined with growing investor interest, has positioned deeptech as the third most funded startup segment in India by 2025.
### Implications for India’s Startup Ecosystem
The establishment of the Bharat Tech Fund is poised to significantly impact the Indian startup ecosystem, particularly in the deeptech domain. By providing substantial financial backing and leveraging strategic partnerships, Piper Serica aims to nurture startups that could drive technological advancements and economic growth. This initiative could potentially set a precedent, encouraging more investors to explore the deeptech space, thereby increasing competition and innovation.
As Piper Serica embarks on this venture, the Indian deeptech landscape is likely to experience a surge in activity. Founders and engineers in the sector should anticipate heightened interest from venture capitalists and prepare for increased competition. Investors, on the other hand, should keep a close eye on how Piper Serica’s fund performs, as it could influence future funding strategies and priorities in the deeptech sector.
