Venture capital firm Accel and investment group Prosus have joined forces to co-invest in early-stage Indian startups, focusing on companies developing breakthrough technologies. The collaboration aims to support startups in sectors such as robotics, advanced manufacturing, and artificial intelligence (AI) applications.
Under the agreement, both firms will match investments up to $2 million each through Accel's Atoms X program. This program is designed for businesses with longer development cycles than typical software startups, often referred to as "LeapTech" companies. These companies require significant capital, credibility, and connections early in their lifecycle.
Pratik Agarwal, a partner at Accel, stated that the partnership seeks to back ideas that create significant market transformations in cost, access, or performance. Ashutosh Sharma, head of India ecosystem at Prosus, noted that Accel is a natural partner for this collaboration. This arrangement marks Prosus' first global co-investment alliance of its kind, as both companies aim to gain exposure to companies that may take 10-15 years to mature but have the potential to dominate their respective categories through technical differentiation.
Accel has backed over 40 companies through its Atoms program, with 30% securing follow-on funding from external investors. Globally, startups in this segment attracted over $80 billion in venture funding in 2024, with India contributing 6-8% of deal volumes. Accel and Prosus have previously collaborated, backing Wiom, an internet-infrastructure platform focused on affordable broadband. Accel's other investments include Posha, a kitchen robotics startup, and Sarla Aviation, which is developing flying taxis.
The partnership between Accel and Prosus signifies a growing interest in India's deep-tech sector. Unlike the United States or China, India has a unique context with the world's largest population and limited resources. Agarwal emphasized the extraordinary potential in LeapTech founders building from science and engineering first principles to solve global problems. He also drew a comparison to bamboo, noting that these companies may grow underground for years before experiencing rapid growth.
This collaboration represents a significant step for Prosus in broadening its investment strategy on a global scale. The initiative aims to provide early-stage startups with the necessary capital and support to navigate the complexities of developing breakthrough technologies and achieving long-term success.
