How Patient Capital is Powering India’s Most Ambitious Green Start-ups

Arjun Bajwa didn’t set out to save the planet; he was simply fascinated by microbes. During his PhD, while running routine lab tests, he observed some strains naturally produced vivid pigments. That piqued his curiosity: could nature’s palette replace petroleum-based dyes? This spawned an idea that eventually became KBCols Sciences, a start-up that makes non-toxic, microbial-based dyes.

However, taking that idea to market, Bajwa realised, was less about chemistry and more about capital and investor conviction. Among the first to offer both was Sudhir Sethi, founder and chairman of Bangalore-based venture-capital (VC) firm Chiratae Ventures, who backed KBCols when few others were willing to take the leap.

What made early investors like Sethi lean in when most looked away wasn’t a secret playbook or clairvoyance. It was something more elemental: conviction that the world was shifting beneath their feet.

Dinesh Pai, vice-president at Zerodha, a financial-services company, and who coordinates investments at the non-profit, Rainmatter, puts it bluntly: “The scale of climate problems makes inertia the bigger risk.” To him and a handful of others, the idea of not investing in climate tech felt riskier than stepping into uncharted territory.

That mental flip, from climate as a liability to climate as an inevitability, changed everything. “At KBCols we saw strong scientific depth and founders with visionary zeal, aligned with fundamental shifts in market needs and our philosophy of long-term value creation,” says Sethi.

Backing to Build

Early bets like these weren’t moonshots or abstract visions of the future. What drew investors in were real-world problems, grounded in infrastructure, that someone had decided to solve.

Fast-charging electric-vehicle (EV) stations. Rooftop solar for homes. Recycled water systems. AI-driven energy management for buildings. The start-ups they backed were laying the pipes and circuits of a different future. That grounded approach gave them a certain credibility, even if the scale and pace were uncertain.

“We back tough, meaningful problems and climate is one of them. If a start-up shows proof of value with early customers, we’re willing to wait. Patient capital creates durable outcomes,” says N S Parthasarathy, managing partner, Mela Ventures, a VC firm.

Returns were part of the equation, too, but the lens was different. Climate ventures weren’t going to behave like fintech or software-as-a-service (SaaS). There was no illusion of a 20x exit in three years. But they could still yield solid, long-term outcomes—financial, strategic and environmental.

“The discipline is to align cost structures and ambition from day one,” says Priya Shah, founder and general partner at VC firm Theia Ventures, whose early backing of Exponent Energy turned into one of the most cited success stories in India’s EV infrastructure space.

There was also something else: involvement. Most of the early backers showed up for their portfolio companies, co-creating models, opening doors, sitting in war rooms and helping make hard pivots. They weren’t just investing in ideas, they were in the trenches with the builders.

“We always bet on the founder,” says Parthasarathy. “In climate tech, passion matters even more; especially when there’s a personal stake in the problem they’re solving.”

And yet, awareness alone won’t move capital. For that, the ecosystem needs to make it easier for funders to say yes. As Shantanu Srivastava, who leads sustainable finance and climate risk at the think tank Institute for Energy Economics and Financial Analysis (IEEFA), South Asia points out, investors need line of sight into where the capital should go, what the timelines are and how risks are managed.

Without a clear pipeline of viable opportunities in sectors like green hydrogen, storage or industrial decarbonisation, even the best-intentioned capital stalls at the gate.

De-risking helps. The kind that made solar mainstream: power purchase agreements, blended finance structures, government-backed guarantees. These were not just financial mechanisms, they were confidence signals to the market.

Srivastava also believes that more long-horizon capital needs to be pulled into the early-stage climate space. “We need to channel more pension-like capital into early-stage climate tech,” he says. That means realigning return expectations, extending timeframes and drawing in institutions like sovereign wealth funds, university endowments and development banks.

Vision Outruns Funds

As Bajwa’s story illustrates, the real issue isn’t about pigments. It’s about how hard it was to find someone who believed in the idea. “When we started pitching to investors in 2019, we faced a lot of rejections,” says Bajwa. “VCs in India often lack a clear playbook for evaluating deep-tech ventures.”

Despite early praise for their technology, KBCols struggled to secure capital. “If we had access to more funding earlier in our journey, we could have scaled faster, accelerated product development and likely commercialised one to two years earlier than we did,” he says.

Bajwa isn’t alone. Many Indian climate-tech founders say they’ve had to educate investors even before they pitch. “Nascent opportunities in climate tech require patience, risk tolerance and deep sector knowledge from investors, coupled with blended, patient capital, non-dilutive funding and strategic corporate partnerships,” says Chiratae’s Sethi.

According to the think tank Council on Energy, Environment and Water’s (CEEW) Investment Sizing India’s 2070 Net-Zero Target report, India needs $10.1trn in climate investment to hit net-zero by 2070. That translates to around $225bn a year for the next 25 years. Current flows are a fraction of that. “If we take $250bn as the target, then $47bn is just about one-fifth of that. Clearly, a significant financing gap still remains,” says IEEFA’s Srivastava.

“Unlike SaaS or fintech, where products go live quickly, deep tech and climate solutions require years of rigorous R&D and infrastructure,” Bajwa explains. Many investors, he says, use metrics designed for consumer apps to assess deep tech and that simply doesn’t work.

The challenge isn’t just about risk appetite. It’s also about capital sequencing. VCs want to know how much follow-on capital a start-up will need before it becomes commercially viable. That question scares off many, even if the idea is promising.

By contrast, countries like Indonesia are developing comprehensive plans, mapping where and how capital will be deployed. “For investment to flow, there must be viable destinations for it,” says Srivastava. “Even if investors are interested in India’s energy transition space, they're mostly putting money into grid-scale renewable energy, and to some extent, EVs.”

“Capital flows are skewed disproportionately toward a few visible sectors like EVs. We need more attention and a stronger policy push for clean air, water and soil,” says Parthasarathy, whose fund has walked the talk by backing Indra Water, a clean-tech start-up. “Their tech is smart, scalable and solves a critical compliance gap,” he says.

Some investors, though, are adapting. “It’s all about identifying tailwinds, where regulation, awareness and business needs are aligning. That makes these investments directionally sound, even if short-term volatility remains,” says Rohit Rajput, partner at Intersection Ventures, a climate-focused investment firm.

The policy ecosystem is turning favourable, too. “The government, along with Sidbi [Small Industries Development Bank of India], SRI [Self Reliant India], various departments and regulatory bodies, is now playing a proactive role in making the start-up funding ecosystem a powerful catalyst for innovation and deep tech,” says Sethi.

Real Returns

Among the beneficiaries of this concerted push is Exponent Energy, a Bengaluru-based start-up offering 15-minute rapid EV charging through proprietary battery-cooling tech. Backed early by Theia Ventures, it now runs over 100 charging stations and is valued at more than $100mn. Later-stage investors like Lightspeed and 8Roads have followed.

“I was extremely bullish about the economic opportunity these technologies could unlock,” says Priya Shah. “Our portfolio demonstrates how financial returns, scalable infrastructure and environmental impact can go hand-in-hand, especially when built with the right cost structures and global ambition from day one.”

Zerodha, too, placed several early bets. Clean-tech company Boson Whitewater treats excess sewage treatment plant (STP) water at source and converts it into potable water—a potential game-changer for water-stressed Indian cities. It also backed SolarSquare, which has solarised 21,000 homes.

“I think with any evolving space, there is always risk,” says Dinesh Pai. “The problems we face today around climate are so stark that the risk of not supporting more start-ups and teams far outweighs any other risk that we see today.”

Then there’s SmartJoules, which optimises energy use in commercial spaces using machine learning. In 2021, Rajput backed it in his corporate capacity when its revenue was just ₹17 crore. Today, turnover has crossed ₹100 crore and it’s nearing profitability.

India’s green transition won’t be driven by fence-sitters or fast money. It will be shaped by investors willing to look beyond pitch decks and projections, to see value in long arcs and hard infrastructure. The capital that succeeds in this space isn’t just early; it is steady, involved and rooted in the realities of the problem it is trying to solve.

If there is a playbook emerging, it is this: find entrepreneurs who are in it for the long haul, ground the business in real needs rather than abstract narratives and be prepared to walk with them, not just fund them.

The fog hasn’t cleared entirely. There are still gaps in policy, in pipelines, in perception. But thanks to a handful of early movers, the path ahead is no longer invisible. They’ve shown that climate investments in India can work; not by mimicking digital playbooks, but by trusting the power of patient capital, clear purpose and partnership. What happens next depends on how many others are willing to make that leap, not someday, but now.

The opportunity is no longer theoretical. In Sethi’s view, the timing couldn’t be more crucial.

“I would invest now; policy follows innovation. Real, long-term returns—financial, strategic, environmental—will go to those who step in before the crowd arrives.”