India’s deep-tech sector faces a funding paradox: strong government push but hesitant private investors due to long gestation cycles and high uncertainty.
FSID’s Pravriddhi initiative builds a full-stack ecosystem for deep-tech startups covering market research, IP, R&D, product lifecycle planning and specialised talent.
Yogesh Pandit advocates a gate-based funding model and stresses the need for mature private investment and industry–academia collaboration to realise India’s Viksit Bharat 2047 goals.
Don't Ask for ₹100 Cr, Ask for ₹3 Cr: Why This Expert Wants Deep Tech Cos to Take One Step at a Time
India’s private investors remain wary of deep tech's long gestation cycles: Yogesh Pandit, IISc's innovation and product development expert, has a simple counter-strategy for startups: earn funding one gate at a time
Summary
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India's deep-tech ambitions face a persistent funding paradox. While strategic compulsions may have led the government to step up with funds and support for startups in this sensitive area, the high level of uncertainty and long gestation periods have deterred private investors, whose money and expertise are indispensable to make the journey from concept to product.
The solution lies in recalibrating how startups approach fundraising, says Yogesh Pandit, Director of Product Acceleration at the Foundation for Science, Innovation and Development (FSID), a non-profit society within the Indian Institute of Science (IISc) that works to translate research into commercial products by providing access to labs, prototyping facilities and product development expertise. Its flagship initiative, Pravriddhi, supports deep-tech startups with a clear national objective: Atmanirbhar Bharat cannot rest on software alone, it must be powered by hardware, materials, sensors, and energy systems rooted in Indian IP.
Pandit says startups in the deep-tech space should adopt a gate-based model to funding:
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"Instead of seeking ₹100 crore at once, ask for ₹3 crore to hit the next milestone. When you achieve it and your confidence rises from 30% to 70%, you then raise the next tranche," he said.
How do you see India’s current deep-tech ecosystem evolving, and what bottlenecks do you think we must address if we want to achieve the Viksit Bharat vision?
The Viksit Bharat narrative looks toward 2047, but reaching that milestone requires us to first bridge several foundational gaps across sectors, whether it's semiconductors, biotech, advanced materials, or other critical technologies. India still doesn’t have full technological sovereignty, and sovereignty is not something any nation hands over easily. Friendly countries may extend limited tech access but that is not what we often refer to as ‘sovereign tech’. That still creates layers of dependence.
If India truly wants to be 'Atmanirbhar' and emerge as a global tech leader by 2047, we must recognise that the road ahead is long and demanding. The challenge is steep, both financially and infrastructurally. However, with sustained investment, strategic focus and mission-driven execution, the journey can be accelerated significantly.
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What is the fundamental difference between a startup incubator and an accelerator?
An incubator helps startups grow organically. It’s where founders refine their ideas, receive foundational support, and build early capabilities at their own pace. An accelerator, by contrast, is built for speed. It’s a structured, time-bound programme designed to rapidly push a product toward market readiness typically within two to three years. Accelerators generally avoid very early-stage startups because those teams often lack labs, product-building capacity, or commercialisation readiness. Instead, they work with ideas that are already partially validated and can be fast-tracked toward deployment.
What key parameters do you look at to determine whether a product idea has the potential to become commercially viable?
There is no shortage of ideas. The real challenge is converting those ideas into workable products. I have been in product development for 23 years and have built 20–30 products, and one thing is clear: product development requires discipline. A design has to be practical, manufacturable and commercially viable.
You can’t, for example, propose a ‘flying phone’ without considering battery constraints, structural feasibility, or real-world practicality. Many startups skip these fundamental evaluations and only later realise that the market doesn’t actually need their product and that’s when companies begin to fail
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Once a startup commercialises its product, does Pravriddhi continue to support or mentor them afterward?
Pravriddhi is a platform that brings together all the critical functions required to build a deep-tech product in India, especially for startups that typically lack these capabilities. Through our work, we identified 11 essential functions for end-to-end product development, and most startups fall short on more than half of them, including market research, IP and regulatory management, product and programme management, and core R&D capacity.
This gap is further widened by India’s low R&D investment of just 0.7% of GDP, with nearly 70% of it coming from the government, leaving limited private-sector capability to support deep-tech product development.
Pravriddhi addresses these challenges by offering structured mentorship, enabling industry–faculty collaboration, helping companies recruit specialised R&D talent, and supporting complete product life-cycle planning—from feature definition and versioning to launch timing and end-of-life decisions. In doing so, it provides a holistic ecosystem for startups to design, develop and mature new products for India.
We also support investments in R&D infrastructure, and provide structured guidance on IP management, program management and product management, the latter being crucial for deciding what features go into a product, when to launch it, when to retire a product variant, and how to manage the entire lifecycle.
In short, Pravriddhi offers all of these capabilities so that any product-driven company aiming to build for India can leverage a complete development ecosystem.
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Are government grants alone insufficient to meet the funding needs of India’s deep-tech startups, and how do you assess the current approach of private investors toward this sector?
This is where my view differs from the usual industry narrative. The government can create direction, provide infrastructure in universities, and offer the initial push. Schemes like the RDI programme are good examples. But it cannot continuously handhold startups through every investment decision. At some point, startups must chart their own funding pathways.
Private investment in India also needs to mature. In the West, institutions like MIT and Stanford are heavily funded by the industry, creating a symbiotic model: academia receives resources, and industry gains access to cutting-edge research. That maturity is still developing here.
The sustainable way forward is staggered investment. Don’t ask an investor for the entire amount upfront. Follow a structured new product development (NPD) framework: move from Gate 1 to Gate 2, and request only the funding required for that specific gate. The goal is to “fail fast, fail cheap.” Instead of seeking ₹100 crore at once, ask for ₹3 crore to hit the next milestone. When you achieve it and your confidence rises from 30% to 70% , you then raise the next tranche.
And finally, the investment community itself needs deeper education about deep tech. Without that understanding, it’s difficult for investors to evaluate risk or back long-term product development meaningfully.
India is pushing into hardware manufacturing, especially through MeitY’s electronics component schemes. Fundamentally, how different and more challenging is building hardware startups compared to software?
Back in the 1980s, BEL was already manufacturing chips at 120–130 microns. Had we sustained that momentum, we might have been at par with players like TSMC today. But India stalled, and now we are operating in catch-up mode.
When you are catching up, you don’t start with cutting-edge development, you start with manufacturing. You import technology, build production capability, get the engine running, and only then transition toward advanced design.
That’s why today’s PLI schemes emphasise packaging and older-generation nodes, especially those used in automotive and non-critical applications. Moving to the 1–5 nm frontier in chip design will take time.
You interact with many young innovators at IISc. How do you assess them, both in terms of their ideation capabilities and the common points where they tend to get stuck?
There is no shortage of ideas. The real challenge is converting those ideas into workable products. I have been in product development for 23 years and have built 20–30 products, and one thing is clear: product development requires discipline. A design has to be practical, manufacturable and commercially viable.
You can’t, for example, propose a ‘flying phone’ without considering battery constraints, structural feasibility, or real-world practicality. Many startups skip these fundamental evaluations and only later realise that the market doesn’t actually need their product and that’s when companies begin to fail.
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