WHY VCS HAVE A NEW PLAYBOOK FOR DEEP-TECH

Venture capital has become more accessible while starting up, but is still scarce at the business end

- Samiksha Goel

Almost a decade ago, Pranav Vempati knocked on the doors of nearly 40 venture capital (VC) firms, asking them to back a bet that would take years to pay off. Not one of them said yes. Vempati was building technologypowered prosthetic hands-devices that could mimic real hand movements and help people with limb issues regain everyday movement. But when he told investors that product development alone could take five years, the conversations often ended after the first meeting.

Undeterred, Vempati, founder of the Hyderabad-based deep-tech startup Makers Hive, turned to strategic angel investors, doctors, hospital heads and industry insiders, who understood the problem and the patience it would take to solve it.

It took years for venture capital to come calling. A few months ago, Makers Hive finally raised its first VC-backed bridge round of ₹10 crore from Silverneedle Ventures and is in talks to raise a Series A between March and May. The shift in mindset is evident. "Now, nobody is talking about timelines. The questions are about patents, IP and what technology you are building. Earlier, it was about how fast you could scale," Vempati told Mint.

For Bengaluru-based Tsalla Aerospace, a seven-year-old startup developing sustainable military and industrial-grade products, most early conversations ended with "great tech but too early or too slow or too complex."

According to founder and chief executive officer (CEO) Vinayak Tsalla, over the last year, the conversations have changed. "With validated technology, government contracts, real deployments and revenue visibility, VCs now engage more seriously. The tone has shifted from 'prove this can work' to 'how big can this get," he said.

While Makers Hive and Tsalla Aerospace survived to see this change, many deep-tech startups could not. Subtl ai and Log9 Materials, founded around the same period, shut shop after struggling with long product cycles and a paucity of capital.