Asserting that there is “limitless headroom for entrepreneurs,” Accel Partner Prashanth Prakash said the venture capital firm will deploy its recently announced USD 650 million fund over the next two to three years to back start-ups focused on artificial intelligence and tech-driven industrialisation.

The firm is looking to invest in 20-25 start-ups this year alone, signalling an aggressive push to tap into India’s evolving innovation landscape.

“If you’re a start-up entrepreneur, there’s no better time to begin. The number of sectors that start-ups are impacting is 10-fold… it is more multi-dimensional and multi-sectoral,” Prakash told the media.

He believes opportunities abound for founders who can envision products needed both in India and globally. India, he said, has strong potential to position itself as a global hub for IP-led innovation and high-value manufacturing in sectors like defence, EVs, aerospace, and energy, leveraging its vast talent pool, agility, and strategic supply chain collaborations.

Prakash, who was among this year’s Padma awardees in the Trade and Industry category, emphasised that Indian start-ups have matured post-Covid, achieving a stronger balance between growth and profitability. He sees a bright future for AI and tech-led ventures in sustainability, electric mobility, and space and defence technologies.

The start-up ecosystem, he noted, is witnessing strong early-stage investment activity, including growing participation from Indian family offices viewing start-ups as a viable asset class. “We have come to a very nice sweet spot in the ecosystem where entrepreneurs understand how and what to build and investors also know what they are looking for,” he said.

Accel’s new fund will focus on three major areas — AI, tech-driven industrialisation, and “Bharat” (start-ups catering to the top 30% of households in India’s Tier-2+ regions). The deployment of the USD 650 million “war chest” is planned over the next 2-3 years.

With a 16-year legacy in India and Southeast Asia, Accel has backed transformational companies across sectors, including Amagi, Acko, BlackBuck, BlueStone, BrowserStack, Cult.fit, Flipkart, Freshworks, Swiggy, Urban Company, and Zetwerk.

Prakash sees the Padma recognition as a broader acknowledgment of start-ups’ pivotal role in reshaping India’s economy. He also highlighted how IPOs have democratized participation in the start-up ecosystem, which is now extending into Tier 2 and 3 cities and fuelling a pan-India entrepreneurship movement.

“The next decade holds even greater promise, with start-ups set to impact a wider range of sectors, playing a key role in nation-building,” he said.

He believes AI is creating transformative opportunities across enterprises, with India’s capabilities in building applications on foundational models being a key growth driver. “Deep-tech-led industrialisation is another promising area,” he said, pointing to how more founders today are ready to set up manufacturing capabilities and build real products.

Prakash stressed the potential of AI for industrialisation and import substitution, citing India’s cost-effective manufacturing as an asset for integrating into emerging global supply chains.

Encouraging Indian entrepreneurs to tap into these opportunities, he urged them to leverage programmes like iDEX (Innovations for Defence Excellence) in the defence sector and innovate across the EV supply chain, countering China’s dominance.

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“It is not only BYD that will supply everything to the rest of the world… there are many components in the EV value chain that Indian entrepreneurs can build,” he said.

Accel continues to support the ecosystem’s growth through initiatives like SeedToScale, an open-source content and community platform sharing insights from founders and operators, and Accel Atoms, an early-stage programme that has helped 36 start-ups raise over USD 200 million across four cohorts.

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