Why Indian Founders Still Seek US Funding Despite $86B in Local Capital

Despite India's venture capital industry holding over $86 billion in available funds, many Indian AI and DeepTech founders continue to seek funding in the US, highlighting a gap between available capital and founder needs

India's startup ecosystem is vibrant, with thousands of alternative investment funds and professionals scouting for deals, yet many entrepreneurs still look westward for validation and funding

Certain practices within Indian venture capital, such as reliance on closed networks, hesitancy to lead investment rounds, and lack of constructive feedback, create barriers for founders

The expectation for quick returns, bias towards elite educational backgrounds, and a preference for ideas proven in the US further hinder innovation in India

Not all Indian venture capitalists operate this way; some are leading the charge by backing unorthodox founders and taking risks on groundbreaking ideas

To retain top talent and foster innovation, India's venture capital industry must evolve from a risk-averse mindset to one that values conviction and partnership

Venture capitalists should treat founders as partners, show genuine curiosity in new ideas, and be willing to take the first step in investing, rather than waiting for others to validate opportunities

By embracing bold ideas and nurturing them with patience, India can ensure its best founders build transformative companies domestically, rather than seeking opportunities abroad

The article underscores the need for a shift from traditional biases and short-term thinking to a more empathetic and partnership-driven approach in India's venture ecosystem

Apoorv Sharma, Co-Founder of Excluto, emphasizes that by fostering a mindset of courage and conviction, India can unlock its true innovation potential and lead in AI, DeepTech, and frontier innovation fields