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Founded in 2017, venture capital firm Speciale Invest funds disruptive technologies at the pre-seed and seed stages in India’s dynamic deep-tech landscape. It plans to invest in 20-22 early-stage start-ups from its ₹300-crore second fund.
Vishesh Rajaram, Managing Partner of Speciale Invest, spoke with businessline on the VC firm’s investment strategy, future roadmap, the government’s role in the promotion of deep-tech, and the growing investor interest in the Indian deep-tech industry. Edited excerpts.
Which are the kinds of deep-tech companies you invest in?
For us, the definition of deep-tech is when more than one stream of science and technology converge to create products that are engineeringly hard to build, or are in path-breaking and new sectors. Start-ups working on quantum security, computing, biomaterials, and drug discovery are some examples, and companies disrupting the existing market or industry by converging two streams of science.
We try to see if the founders’ insights, execution capabilities, and learnings about the industry allow them to disrupt a large market opportunity with a competitive advantage that creates large margins and earnings.
How would you describe your investment journey?
We raised our first fund of ₹60 crore in 2018, backed 18 companies with an average deal size of sub-$0.5 million, and scored four early exits. In April 2022, we made the final close of our second fund at ₹300 crore. Between both funds, we have invested in 34 start-ups.
Agnikul Cosmos, The ePlane Company, GalaxEye Space, Astrogate Labs, CynLr, QNu Labs, Uravu Labs, Wingman, Trainn, and StreamAlive are some of the start-ups we have invested in.
What are your future investment plans and interests?
We plan to invest in more than 20 early-stage companies through pre-seed and seed rounds, with cheque size ranging from $100,000 to $1 million. By the end of next year, we aim to make 8-10 investments. Further, based on performance, we will think about future funds and expansion beyond India.
We will remain a pre-seed fund, as that is in the DNA of our firm. Our ability to underwrite risk and understand uncertainty at an early stage aligns with our DNA. We are also steadily building our ability to support start-ups in hiring, early business development, and strategic alliances.
How do you see the deep-tech space evolving and the investor interest in it?
Prospects for deep-tech are very positive in India now. The [government] policy is supporting deep-tech in a strong way, be it for quantum technology, space technology, or EV [electric vehicles]. On the other hand, the number of investors in the deep science and tech sector has also doubled or tripled in the last few years. Mainstream VCs are also interested, and the capital allocation is increasing.
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