Why Indian Start-Ups Are Struggling To Raise Funds

Despite being a leader in semiconductor design talent, Indian start-ups are struggling to raise funds

- Nidhi Singal

FOUNDED IN 2007, Saankhya Labs is one of the few Indian fabless companies that has steered through many a tough time since its inception. With 73 international patents, Saankhya has been developing its own chips, building software-defined radio chipsets, and it is the only non-telecom company to be allotted 5G spectrum for trials. And recently, optical networking products vendor and Tata group entity Tejas Networks acquired a 64.40 per cent stake in it for ₹283.94 crore in cash.

But, this journey wasn't easy. The company survived with initial funding of just $2 million raised from family and friends between 2007 and 2011. "Since venture capitalists (VCS) always look for customer validation, our biggest challenge was not having a local customer and ecosystem that could vouch for our product. Ultimately, one of our US-based customers endorsed it, and that enabled investment," explains Hemant Mallapur, Co-founder and EVP of Engineering at Saankhya Labs.