India's deep-tech revolution: The next global disruptors? | Mint – Mint

Deep-tech startups are stepping up, developing game-changing solutions with the potential to transform the country’s most pressing challenges.

But deep tech is a high-risk, high-reward space for investors.

You see, these companies navigate long timelines and confront the complexities of turning science into scalable products.

However, the potential payoff is immense. We’re talking about disrupting entire sectors, not just incremental improvements.

Why India?

Urgent needs: India’s challenges in access to healthcare, sustainable energy, and agriculture drive a real need for transformative technologies. Necessity breeds invention.

Market opportunity: India’s population provides a vast, diverse testing ground and a massive potential customer base for solutions that are tailored to local needs.

Talent base: India’s reputation for nurturing technical and scientific talent is a powerful asset for deep-tech ventures.

Understanding deep tech: Where true disruption lies

‘Deep tech’ isn’t just another buzzword. Here’s what these companies do:

• Embrace science: They build on groundbreaking research in AI, robotics, advanced materials and more to change the rules of the game.
• Accept longer timelines: Commercialisation takes time and investment. These aren’t quick wins, but those that succeed have enormous potential.
• Take on more risk: Turning cutting-edge science into a viable product is complex. But the ‘moonshots’ that pay off can be truly revolutionary.
• Tackle global problems: They’re working on solutions for healthcare, climate change, and resource scarcity – not just optimising existing apps.

India’s deep-tech surge

India’s startup scene is buzzing with deep-tech ventures that are unafraid to take on big problems.

AI-powered diagnostics: Imagine accessible, early-stage disease detection in areas with limited healthcare – that’s life-changing. Agritech innovations: India’s agriculture needs solutions for higher yields and sustainable practices. Deep tech offers a path forward.

Space ventures: India has established space capabilities and startups are pushing this further with a commercial, disruptive edge.

India’s startup scene is seeing an undeniable surge in deep-tech ventures that are pushing the edges of science and engineering to revolutionise industries.

India’s unique advantages for deep-tech startups

Talent powerhouse: India’s vast pool of skilled engineers and scientists provides a strong foundation for building deep-tech solutions.

Massive market potential: India’s unique challenges and rapid digitisation create a proving ground for scalable deep-tech products and services.

Increasing government support: Initiatives such as Digital India, Startup India, and the recent ₹1 trillion research fund signal a growing commitment to fostering deep-tech innovation.

Startup ecosystem growth: The maturing startup ecosystem, with increasing VC interest in deep tech, is creating a more conducive environment for these ventures.

Challenges remain

Let’s be realistic. Deep tech startups, even in India’s exciting environment, face some classic hurdles.

The funding dilemma: It’s tough to get investors excited about unproven science. Finding early-stage capital for a truly out-there idea is an uphill battle.

Lab to launchpad: Turning a breakthrough into a profitable product is where many stumble. Startups need support to bridge that gap, not just from academia, but from real industry players.

Safeguarding innovation: India’s IP protections are improving but they still lag those of western nations. Startups with cutting-edge tech need that security to truly thrive.

Smart investing in deep-tech startups

Investing in deep tech isn’t like backing the latest social-media app. Here’s what we look for:

The problem matters: Is this solving a small annoyance or something that fundamentally improves healthcare access, food production, etc? Impact is key.

Science, not just hype: A flashy demo is nice, but we also dig into the R&D. Have they partnered with a respected institute? Is their core tech solid?

Beyond the brilliance: Give me a genius scientist paired with someone who gets how to build a business. That balance is rare, but essential for long-term wins.

India has all the ingredients to be a deep-tech powerhouse. But it’s not just about the ideas – it’s about enabling the full journey from research to revolution.

Deep-tech showdown: India vs US vs China

The deep tech race is on. It’s not just about who has the smartest scientists, but who builds the right environment to turn those breakthroughs into world-changing companies. Let’s break down the heavyweights:

US: The old guard still packs a punch

The lab advantage: No one beats the US for top-tier universities and research powerhouses. This is where the next big AI or biomaterial innovation is born.

Money talks: Silicon Valley VCs get deep tech. They’re not afraid to bet big on long-term plays if the potential payoff is massive.

Risk is rewarded: That ‘fail fast’ mentality is why the US does disruptive innovation so well. Startups aren’t afraid to swing for the fences.

But it’s not all smooth sailing

Cost of genius: Top talent and fancy labs don’t come cheap. Startups fight hard for resources.

Global brain drain: The best minds go where opportunity is. The US needs to stay competitive to keep attracting them.

China: The focused giant

Playing the long game: The government calls the shots on what tech gets priority. That means resources flow where they see a strategic advantage.

Made-in-China advantage: Need to scale up that new robot quickly? China’s manufacturing might is unmatched.

Testing ground: With more than a billion customers, you won’t lack for early adopters if your product has mass appeal.

Watch out, though

IP worries: Startups (and investors) worry about how well their tech secrets will be protected.

Politics matter: Trade wars and such spill over into science, making global partnerships tricky.

India: The wildcard with serious potential

Talent goldmine: Hordes of engineers available at competitive costs compared to the West is fuel for deep tech.

Real-world impact: India’s problems need deep-tech solutions. This sparks that ‘make a difference’ fire in startups.

Government’s waking up: They’re talking the talk on supporting innovation. We’ll see how much money actually follows.

What’s missing

A master plan: Right now, the sector feels scattered. India would benefit from a US-style DARPA for deep tech.

The early-bet problem: Raising seed funding is tough. India needs angels who are excited by long-term potential, not just quick app wins.

No one country has it all. The smart money will look at the specific area of tech and which country gives a startup the best shot at not just surviving but truly scaling.

Where India’s deep tech thrives

It’s not just about Bangalore anymore. Multiple cities are making their mark as deep tech hotspots, each with its own flavour:

Bengaluru: The undisputed champ

Everyone knows Bangalore’s tech scene is massive. But for deep tech, it’s the combo that matters: top-tier institutes like IISc, corporate giants with serious R&D budgets, and that special sauce – a culture that supports moonshot ideas. Startups tap into all of it.

Delhi and NCR: Where government meets grit

Think deep tech from a defence angle. State-run labs are a thing here, and startups like NewSpace are leveraging this for aerospace innovation. Don’t underestimate the northeast either – Kolkata’s RISE Foundation is quietly backing some interesting science-to-market ventures.

Mumbai: The money and the minds

India’s financial capital is also becoming a deep-tech hub. Easier access to capital is a big draw, and you can’t ignore the talent pool from places like IIT Bombay. Deep tech needs both the brains and backing, and Mumbai may just have the right balance.

The rising stars: Pune, Chennai, Hyderabad, Ahmedabad

These cities are worth keeping an eye on. Great research institutes, growing tech parks, and an appetite from investors to look beyond the obvious hubs – that’s a recipe for deep-tech surprises.

India’s deep-tech leaders: Separating substance from hype

India’s deep-tech ecosystem is undeniably active, but it takes careful analysis to identify the companies with true disruptive potential. Here’s a look at startups that demonstrating the ability to translate cutting-edge science into scalable solutions:

Space: Where accessibility drives disruption

Bellatrix Aerospace: Their mission to drive down space hardware costs is a potential game-changer. Significant investment (IDFC Parampara, GrowX Ventures) signals the market’s confidence in their approach.

GalaxEye: These aren’t just satellite manufacturers; they turn Earth observation data into insights with wide-ranging applications. Their traction in agriculture and infrastructure demonstrates commercial viability.

Drones: Purpose-built problem solvers

Garuda Aerospace: Their comprehensive drone and software solutions tackle practical challenges in agriculture and industrial inspections. Clients such as Intel and the Indian Army speak to their reliability.

IdeaForge: Drones designed to withstand the demands of military use inherently have robustness transferable to the commercial sector. This adaptability has long-term value potential.

Robotics & automation: Beyond industrial applications

Asimov Robotics: While customer-facing robots are attention-grabbing, their true potential lies in streamlining complex tasks within healthcare and facilities management. An influx of funds – $2.3 million from Anveshan Capital, etc – suggests they’re on the right track.

Doxel: Warehouse efficiency gains may not sound groundbreaking, but they address a significant logistical pain point. Their focus on a real-world problem is a hallmark of successful deep-tech solutions.

Materials innovation: The foundation for future industries

Log 9 Materials: Their development of ultra-fast charging EV battery technology has the potential to transform the automotive industry. Backing from major players (Amara Raja Batteries, Sequoia India) indicates belief in their path to commercialisation.

Infinite Material Solutions: Graphene is a powerful starting point, but their diverse exploration of next-gen materials has broad applications. Their investors (NextOrbit Ventures) favour companies with multiple avenues for success.

Addressing India-specific challenges

Bicatech: Improving crop yields is vital, but their focus on climate resilience is forward-thinking and speaks to India’s unique agricultural needs. This type of targeted innovation resonates with investors.

Carbon Clean: Cost-effectiveness is key to widespread adoption of green technologies. Their solutions to tackling major pollution sources have a strong value proposition, attracting global investors (WAVE Equity Partners, etc).

Other companies to watch

Sigtuple & Ambee: India’s AI expertise is put to practical use in these companies’ healthcare and environmental solutions. This focus on tangible outcomes is essential for market adoption.

The Long Shots: Pandorum’s 3D organ printing and QNu Labs’ quantum security work represent the high-risk, high-reward frontiers of deep tech. These ventures are inherently speculative yet crucial for true breakthroughs.

Conclusion

India’s deep-tech scene is buzzing with potential. It offers a compelling mix of urgent problems in need of solutions, a tech-literate population hungry for progress, and a government increasingly open to innovation.

But for investors, excitement needs to be tempered with a realistic assessment of both opportunities and hurdles. India has the ingredients to become a deep tech leader, but the recipe for success is complex.

Those that understand the unique challenges, prioritise deep tech that solves real problems, and identify startups with both a scientific and business edge have the chance to tap India’s long-term disruptive potential.

You can begin your journey to know more on India’s potential deep-tech stocks here.

Stay tuned to this space as we will be writing more on deep-tech stocks in the coming days.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such.