Indian Deeptech Isn’t Getting ‘Deep’ Due To Lack Of Patient Capital

We often celebrate capital flows in India’s startup ecosystem like they’re a signal of maturity. And on the surface, there’s a reason to do so: According to Inc42’s H1 Funding Report, $5.7 Bn was raised in just the first half of 2025. India minted 5 new unicorns, saw 11 mega deals over $100 Mn, and welcomed more than 1,100 investors into the fold. The headline numbers tell a story of momentum.

But the real story, I believe, lies beneath that surface and it’s not just about how much capital is coming in, but how that capital behaves once it’s here. 

Because if we zoom in on where the money is going—and more importantly, how long it stays—the picture gets blurry. As shown in the graph above, AI and deeptech are top early-stage bets for Indian investors. Yet, if you follow the actual funding flow, the enthusiasm hasn’t yet translated into allocation.

What the H1 2025 Data Is Telling Us 

If you read the report closely, you’ll see a clear tension between what the ecosystem is excited about and what it’s actually funding. 

$5.7 Bn in the first six months of 2025 sounds like recovery. But when you unpack the sectoral splits, the gaps are striking.  

In contrast, fintech and ecommerce alone accounted for nearly half of all $100 Mn+ mega deals in H1. And while growth-stage capital crossed $2 Bn, it was overwhelmingly skewed toward proven commercial models, not frontier technologies. 

Why does this disconnect matter? 

Because when deeptech funding lags this far behind narrative, it signals something deeper: that the system is optimising for movement, not meaning. 

It’s easier to fund a second-layer fintech than a first-principles frontier startup. That’s not an indictment—it’s a structural reality. But we can’t ignore the consequences. 

The Rise of Capital: The Absence Of Patience

If capital was the only signal we needed to measure ecosystem maturity, we would have arrived by now. The numbers are there and unicorns are back in headlines. 

But capital is only as useful as the time it’s willing to give. 

Early stage funds are built with 5–7 year horizons, but deeptech businesses don’t even begin showing proof in that time. Investors get in early, take the risk, and just when the potential starts to unfold, they’re looking for an exit. Because the fund’s clock has already run out.‘Exponential outcomes don’t come in linear timelines.’

That’s a line I’ve repeated multiple times. And yet, we design funds for time-bound exits, not time-aligned breakthroughs. 

That’s where Patient Capital comes in. Not just longer-duration capital, but capital that is structured to absorb the uncertainty of unknowns. Capital that understands the second-order nature of innovation. Capital that doesn’t measure success only in interim multiples. 

Until we solve for that, we’ll keep celebrating movement while missing the meaning. 

Rebuilding The Capital Stack For Innovation  

If we’re serious about building enduring innovation, we have to rethink where our capital comes from—and what it’s designed to do. Deeptech needs capital with a long spine, not a fast hand.

That’s where a new layer is slowly starting to emerge. Strategic, sector-aligned funds that are willing to think in 10-year horizons. 

We’re seeing signs. As highlighted in the report, a few institutional funds with sizes as large as $185 Mn are beginning to back sectors like healthcare, biotech, cleantech, and student-led innovation. These are domains where outcomes unfold over a decade, not a quarter. 

For Indian Deeptech To Go Deeper… 

We keep talking about ambition, but the question we don’t ask enough is: “Are we funding that ambition on its natural timeline?” Because exponential outcomes are built through time, trust, and capital that can hold its nerve when nothing seems linear. 

Until that becomes the norm—not the exception—fund managers are left with no choice but to fund the noise. 

Because a lot of impatience capital is available in the market because in a capital-first economy, markets take shape wherever there is demand and supply. The market is not rewarding patience. It is currently rewarding movement, momentum, and early returns. That pressure trickles down. Even fund managers who believe in deeptech are often forced to design shorter-term strategies, because most of their LPs aren’t prepared to stay for the long haul. 

Deeptech investing requires a different lens that only gets refined through cycles of trial, error, and time. If no one gains that experience now, then even when LPs will understand the potential of it then, we may not have the people who know how to use it. 

So, if we want India to lead in innovation, we have to fund like we’re staying for the second innings, not just the opening shot.