Venture capitalists are showing a growing interest in early-stage investments within deeptech sectors, such as artificial intelligence, healthcare, and precision manufacturing. This trend marks a departure from larger funding commitments, suggesting a strategic pivot towards smaller transactions.
Among the startups attracting attention are Parsec Aerospace and Alteon Energy, both engaged in fundraising discussions. Parsec is reportedly negotiating a $4 million round with Lightspeed Venture Partners, while Alteon is seeking $2 million from Lachy Groom Group.
The healthcare sector is also witnessing notable activity. Dognosis, a startup leveraging dogs' sense of smell with machine learning for disease detection, recently secured between $4 million and $6.5 million with backing from Accel Partners and others.
Locksmith Bio, which employs AI in drug development, is in preliminary discussions with investor Sameer Brij Verma for new capital. Verma is also considering an investment in Leumas, a precision manufacturing company serving the pharmaceutical industry.
Current Funding Landscape
While early-stage funding is on the rise, growth-stage investments remain sluggish. In 2025, growth-stage deeptech startups raised $406 million across 21 deals, down from $463 million in 2024. The current year has seen limited growth-stage activity, aside from a significant $600 million round by AI infrastructure startup Neysa.
Despite these challenges, several growth-stage rounds are reportedly in the works. Drone startup Airbound is seeking around $30 million from Greenoaks and Lachy Groom Group, while precision manufacturing firm Ethereal Machines is targeting a similar amount from Avataar Venture Partners and Peak XV Partners.
Looking Ahead
Investor sentiment appears to be shifting, with expectations of increased growth rounds as successful outcomes emerge, such as the Sedemac IPO. The Indian deeptech ecosystem is gradually maturing, with government policies supporting the sector's growth.
Additionally, the global surge in AI investments is influencing Indian venture capital firms, prompting them to explore opportunities beyond domestic borders, particularly in the United States.
As the Indian startup ecosystem evolves, the focus on early-stage deals may lead to a more robust landscape, with the potential for larger capital commitments in the future.
