Following VC investments in ecommerce and fintech, “the easy opportunities are largely gone now,” the Zerodha chief executive pointed out. “You truly have to do something special to make VC-like returns. Result? A noticeable shift towards more challenging, complex areas, such as deeptech.”
Venture capital interest in India rose during 2010 on account of the country’s “opportunity size”, Kamath wrote. The population was the primary driver in attracting VC money, he said.
Meanwhile, cheaper internet has helped create talent beyond metros and Tier-I cities, and better education has created more risk-takers. “…and the growing economy attracts global institutional capital,” Kamath added.
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“The funding ecosystem itself is growing. Every wealthy individual now has a “family office”, and there’s a global rush into VCs/PEs. Stocks and bonds are boring; private investing is popular among the wealthy. While there’s stupidity, it’s still net positive,” Kamath said.
As the funding scene evolves, it creates feedback loops which have strengthened the Indian startup ecosystem over the past decade and a half, Kamath wrote. The development coincides with countries preferring self-sufficiency over globalisation, he added.
“I’m hoping this ecosystem grows wider and deeper, with many more Indian startups solving local and global problems,” he posted.
Venture capital investment in the Indian startup ecosystem remained slow during the third quarter (July-September) of 2025, even as overall global investments crossed $100 billion for the fourth consecutive quarter amid an uncertain geopolitical environment.
While VC funding slowed, the country reported a strong quarter for exits, with values (or valuations?) surging to a record seven-year high, according to the second edition of KPMG Private Enterprise’s Venture Pulse, a quarterly report tracking global investment trends.
“VC investments in India this quarter were driven by the speed bump that was the US tariffs, but people expect that by the end of November that will settle,” said Nitish Poddar, partner, private equity, KPMG India. “But investors are going to be focussed heavily on the path to profitability and cash flows because without those you won’t get a capital market exit.”