U.S. and Indian Venture Capitalists Join Forces in a $1B+ Initiative to Support India’s Deep Tech Startups

Groundbreaking Alliance Forms to Boost India’s Deep Tech Startups

A coalition of eight prominent U.S. and Indian venture capital and private equity firms, including Accel, Blume Ventures, Celesta Capital, and Premji Invest, has joined forces to invest over $1 billion in India’s deep tech startups over the next decade, enhancing U.S.-India tech collaboration.

Tackling Funding Concerns in India’s Startup Ecosystem

This alliance responds to persistent funding challenges highlighted by Indian Commerce Minister Piyush Goyal, who faced backlash for criticizing local startups for lacking innovation and focusing primarily on food delivery services. In contrast, founders pointed out that access to capital for deep tech ventures is scarce in India. The coalition aims to address these issues by channeling long-term private investment into technologies that have historically struggled for funding.

Unprecedented Collaboration Among Investors

The newly formed India Deep Tech Investment Alliance is notable because it formally unites investors who traditionally compete for deals. While collaboration typically happens on a case-by-case basis, this group is committed to pooling resources and efforts under a unified banner.

Members Commit to Long-Term Investment

The alliance, consisting of Celesta Capital, Accel, Blume Ventures, Gaja Capital, Ideaspring Capital, Premji Invest, Tenacity Ventures, and Venture Catalysts, announced its formation following a ₹1 trillion (approximately $11 billion) Research, Development, and Innovation (RDI) scheme approved by the Indian government aimed at promoting deep tech R&D.

Strategic Focus on Indian-Domiciled Startups

Each member of the alliance will commit private capital over the next 5 to 10 years to support local deep tech startups. As many notable deep tech companies with Indian founders are currently based in the U.S., the new RDI scheme requires local incorporation, which the coalition aims to leverage.

Providing Mentorship and Expanding Networks

Beyond funding, the alliance plans to offer mentorship and networking opportunities to startups, while also assisting portfolio companies with their expansion into the Indian market.

Navigating Geopolitical Challenges

Despite the complex geopolitical landscape, including recent tensions between the U.S. and India, the alliance is optimistic about India’s potential as a startup hub for foundational technologies like AI, semiconductors, and biotech.

Investment Opportunities for U.S. Companies

“India presents a particularly compelling market, not only for local companies but also for U.S. firms looking to expand,” noted Sriram Vishwanathan, founding managing partner at Celesta Capital, highlighting the alliance’s goal to invigorate the Indian startup ecosystem.

Focusing on Early-Stage Startups

The alliance’s initial focus will be on early-stage startups, from seed to Series B funding, with an eye on attracting further participation from both VC and private equity firms in the future.

Engagement with Government Policies

Members of the alliance intend to engage proactively with the Indian government to advocate for favorable policies, aiming to create a unified voice to support industry interests while adhering to RDI conditions.

Potential Risks and Rewards

While the collaborative effort is positioned as beneficial for the deep tech ecosystem, there’s an inherent risk that miscoordination could leave startups facing challenges. Nevertheless, optimism remains high for India’s ability to produce transformative technologies over the next decade.

“The future is bright: ambition, talent, and patient capital are converging to transform the Indian startup landscape,” stated Accel partner Anand Daniel.

Here are five FAQs regarding the U.S. and Indian VCs forming a $1B+ alliance to fund India’s deep tech startups:

FAQ 1: What is the purpose of the $1B+ alliance between U.S. and Indian VCs?

Answer: The alliance aims to fund and support India’s deep tech startups, fostering innovation and growth in sectors such as artificial intelligence, robotics, 5G, and biotechnology. By pooling resources and expertise, the VCs intend to accelerate the development of cutting-edge technologies in India.


FAQ 2: Which specific sectors will the alliance focus on?

Answer: The alliance will primarily concentrate on deep tech sectors, including artificial intelligence, machine learning, robotics, 5G communications, biotechnology, and other advanced technologies that have the potential for significant impact and scalability.


FAQ 3: How will this funding impact Indian startups?

Answer: The partnership is expected to provide significant financial resources, mentorship, and access to global markets, enabling Indian startups to scale their operations, innovate rapidly, and compete on an international level. This could lead to job creation and technological advancements within India.


FAQ 4: Are there any eligibility criteria for startups to secure funding from this alliance?

Answer: While specific criteria may vary, startups typically need to demonstrate innovative technology, scalability potential, a strong business model, and a capable management team. Startups will likely need to apply through designated channels or partners associated with the alliance.


FAQ 5: How can startups apply for funding through this alliance?

Answer: Startups interested in funding from this alliance should prepare a comprehensive business plan and proposal. They can monitor announcements from the participating VCs for application procedures, investment windows, and specific criteria. Networking at industry events and utilizing platforms connected to the alliance may also enhance visibility to potential investors.

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A 2025 Timeline of the U.S. Semiconductor Market

2025 Highlights: The U.S. Semiconductor Industry in Flux

This year has already proven to be eventful for the U.S. semiconductor sector.

The semiconductor industry is at the forefront of the U.S.’s ambition to excel in the “AI race.” Notable changes include Intel’s appointment of Lip-Bu Tan as CEO, who is on a mission to reinvigorate the company, and the failed proposal by Joe Biden to implement comprehensive AI chip export regulations.

Let’s break down the key events from the first half of 2025.

June Highlights

Intel Welcomes New Leadership

June 18 – Intel has appointed four new leaders aimed at restoring its status as an engineering-centric company. This includes appointing a new chief revenue officer and several prominent engineering roles.

Intel to Downsize Workforce

June 17 – Intel is set to lay off a significant portion of its Foundry staff starting in July, with reductions expected between 15% and 20%. These reductions align with CEO Lip-Bu Tan’s vision to streamline operations.

Nvidia Excludes China from Financial Forecasts

June 13 – Nvidia is adjusting its expectations, as CEO Jensen Huang announced that the company will omit the Chinese market from future revenue and profit outlooks due to ongoing U.S. export restrictions.

AMD Expands Talent Pool

June 6 – AMD has enhanced its expertise by acqui-hiring the team behind Untether AI, which specializes in AI inference chips, as part of its strategy to bolster its AI initiatives.

AMD Targets Nvidia’s Market Share

June 4 – Continuing its acquisition spree, AMD secured AI software startup Brium, focused on optimizing AI software for diverse hardware, highlighting the competitive landscape in the AI sector.

May Developments

Nvidia Unpacks Financial Impact of Export Rules

May 28 – Nvidia revealed that U.S. licensing requirements have cost the company $4.5 billion during Q1, predicting an $8 billion revenue hit in Q2 as a result of these new regulations on its H20 AI chips. Read more.

AMD Acquires Enosemi

May 28 – AMD continues its aggressive acquisition strategy by acquiring Enosemi, a silicon photonics startup, to enhance its capabilities in data transmission technology critical for the AI era. Discover the details.

Rising Tensions: China and the U.S.

May 21 – In response to the U.S.’s warning about Huawei’s AI chips, China’s Commerce Secretary issued a statement threatening legal action against companies enforcing these export restrictions. Full story here.

Intel’s Non-Core Units Under Review

May 20 – Intel’s CEO Lip-Bu Tan is reportedly shifting focus to spin off non-core business units, aiming to streamline operations and enhance efficiency. Learn more.

Biden Administration’s AI Diffusion Rule Rescinded

May 13 –Just days before its implementation, the U.S. Department of Commerce rescinded the AI Diffusion Rule, with intentions to provide new guidelines in the future amidst ongoing tensions regarding Huawei’s AI chips.

April Highlights

Anthropic Supports Chip Export Restrictions

April 30: Anthropic has reinforced its support for U.S. chip export restrictions, suggesting modifications to the proposed Framework for Artificial Intelligence Diffusion aimed at tightening controls on Tier 2 nations. Explore the details.

Intel’s Significant Layoffs

April 22: In advance of its earnings call, Intel announced plans to cut over 21,000 jobs, part of a strategic push to streamline management and bolster its engineering focus.

New Export Regulations from the Trump Administration

April 15: Nvidia’s H20 AI chip faced new export licensing requirements, leading to potential $5.5 billion charges expected in their upcoming fiscal quarter.

Nvidia and Export Controls

April 9: Reports indicated that Nvidia’s CEO Jensen Huang engaged with Donald Trump to seek relief from further chip export restrictions, potentially in exchange for investments in U.S. AI data centers.

Alleged Intel-TSMC Partnership

April 3: Intel and TSMC reportedly are in talks to form a joint chipmaking venture, although both parties have opted not to confirm the agreement as of now.

Intel’s New Initiatives

April 1: CEO Lip-Bu Tan announced plans to spin off non-core assets and launch new products tailored to customer needs in the semiconductor realm.

March Updates

A New Era for Intel with New CEO

March 12: Intel appointed Lip-Bu Tan as CEO, marking a new chapter focused on engineering excellence within the company.

February Developments

Intel’s Ohio Chip Plant Delay

February 28: The anticipated opening of Intel’s first chip fabrication facility in Ohio has been delayed again, with the completion now pushed to 2030. Learn more about the timeline.

Senators Push for Stricter Chip Export Controls

February 3: U.S. senators, including Elizabeth Warren and Josh Hawley, urged the Trump administration to enhance restrictions on AI chip exports, specifically targeting Nvidia’s H20 chips. Full letter available here.

January Events

DeepSeek’s Game-Changing AI Model

January 27: DeepSeek, a Chinese AI startup, disrupted the market with the launch of its open R1 “reasoning” model, generating significant interest and concern in both AI and semiconductor sectors.

Biden Proposes New Chip Export Limits

January 13: In his final week as president, Joe Biden recommended extensive new restrictions on U.S.-made AI chips, introducing a three-tier export structure that impacts various nations differently.

Anthropic Discusses Export Controls

January 6: Dario Amodei, co-founder of Anthropic, publicly supported existing AI export regulations while advocating for even stricter controls to maintain U.S. leadership in AI. Read the op-ed.

Sure! Here are five FAQs about the US semiconductor market in 2025:

FAQ 1: What is the current status of the US semiconductor market in 2025?

Answer: In 2025, the US semiconductor market is experiencing significant growth, fueled by rising demand for advanced technologies such as AI, IoT, and 5G. Major investments in domestic manufacturing and research are reshaping the industry’s landscape.

FAQ 2: How has government policy affected the semiconductor market?

Answer: Government policies, including the CHIPS Act, have provided substantial funding and incentives to bolster semiconductor manufacturing in the US. This aims to reduce dependency on foreign sources and enhance national security.

FAQ 3: What challenges does the US semiconductor industry face in 2025?

Answer: The US semiconductor industry is grappling with challenges like supply chain disruptions, increasing competition from global markets, and the need for skilled labor. These factors can impact production rates and innovation.

FAQ 4: How has the supply chain evolved by 2025?

Answer: By 2025, the US semiconductor supply chain has become more localized, with an emphasis on resilience against global disruptions. Companies are investing in domestic facilities and fostering partnerships to enhance supply chain security.

FAQ 5: What role does innovation play in the US semiconductor market in 2025?

Answer: Innovation is a key driver in the US semiconductor market, with companies focusing on next-generation technologies such as advanced fabrication techniques and sustainable manufacturing processes to meet the evolving demands of various industries.

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