AI and other deep technologies are dominating the latest early-stage cohort of companies from Peak XV Partners, the leading venture capital fund focused on India and Southeast Asia. This surge in interest coincides with a growing international frenzy in the sector.
Out of the 13 startups in Surge’s ninth cohort, a flagship early-stage program by Peak XV, an impressive 10 are dedicated to AI and other deep tech domains. This announcement comes at a time when India’s AI startup landscape is believed to be lacking depth, even as global interest in AI startups continues to rise. For instance, Y Combinator’s recent batch includes over 200 startups, more than half of which are AI-focused. However, less than 10 of these are based in India, sparking concerns about a potential disconnect between the Indian market and venture firms.
Shailendra Singh, Managing Director of Peak XV, expressed his desire to see more AI startups in India while acknowledging that they have identified and invested in some promising ventures. He believes that India is gradually becoming a more fertile market with increasing expertise in the tech sector.
The latest Surge 09 cohort encompasses a diverse range of startups, including those addressing issues like early brain decline, processor design innovation, and hydrogen economy scaling. Several founders in this cohort possess PhDs and international work experience, highlighting the maturation of the Indian startup ecosystem.
Surge, which will celebrate its fifth anniversary in early 2024, has emerged as a significant early-stage investor in India and Southeast Asia. It differentiates itself by offering close mentorship to startups, providing up to $3 million in seed funding, and granting access to an extensive network of resources. To date, the program has supported over 140 firms that have collectively raised more than $2 billion in follow-on funding.
The surge in interest in deep tech startups has spurred other VC firms in India to create similar programs, which Shailendra Singh views as a positive development for founders and the overall ecosystem.
Notably, the new fund, the first since Peak XV’s separation from Sequoia U.S., includes two Australian startups, indicating the venture firm’s growing interest in the Australian software market. Singh believes that Peak XV’s expertise in helping companies go global aligns well with Australian software startups’ ambitions to become global players, thus presenting a valuable opportunity for both sides.
