IIT Madras, IIT Madras Research Park, and Unicorn India Ventures have announced the first close of IITM Unicorn Frontier Fund I at ₹450 Cr, with nearly ₹55 Cr already deployed across four startups.
The first close adds to a string of deeptech fund announcements in India, as investors commit more capital to sectors such as semiconductors, spacetech, and advanced manufacturing.
The fund targets a portfolio of 25 startups with cheques of ₹15-25 Cr and aims to complete fundraising by December 2026, targeting ₹1,000 Cr.
IIT Madras, IIT Madras Research Park (IITMRP), and Unicorn India Ventures have announced the first close of their deeptech-focused IITM Unicorn Frontier Fund I at ₹450 Cr (about $46.9 Mn).
The fund has already deployed nearly ₹55 Cr across four startups — Hathor, Quanastra, Triolt Energy, and Carbelim.
Launched in February, the fund has a base corpus of ₹600 Cr and a ₹400 Cr greenshoe option, allowing it to raise up to ₹1,000 Cr (about $104.4 Mn). It is targeting a final close by December 2026.
The fund’s backers include IIT Madras alumni and family offices, with institutional investors and banks expected to participate by the final close. The announcement was made at an event organised by IIT Madras Alumni Association in the presence of finance minister Nirmala Sitharaman.
Managed by Unicorn India Ventures, the fund aims to build a portfolio of 25 startups, with cheque sizes ranging from ₹15 Cr to ₹25 Cr.
Most of its investments will target early-stage deeptech startups at technology readiness levels (TRLs) 3-4, covering proof-of-concept development and laboratory validation.
Its six focus areas are defence tech, spacetech, semiconductors, manufacturing technology, robotics, and automation, AI infrastructure and GenAI, and healthtech. The fund, in a statement, said it would assess potential investments for their export opportunities, ability to replace imports, and contribution to domestic technological capabilities.
Meanwhile, speaking at a fireside chat on the sidelines of the event, Sitharaman reportedly called for more investments in emerging areas such as AI infrastructure, semiconductors and quantum technology.
As per news agency PTl, she also underscored the need for accelerating efforts to build the hardware, skills and institutional ecosystem required to harness these emerging technologies.
“… despite the call for slowing down the speed with which innovators are coming up in the AI field, I’ll still think, for India, from where it is, we still need a lot more investment towards bringing in that kind of hardware and bringing in that kind of teachers to institutions which have to constantly upgrade and keep imparting AI-based knowledge, adaptability of AI into very many sectors,” she reportedly said.
The finance minister also underlined the need for greater investment in defence production, particularly in emerging technologies such as unmanned systems and drones.
Among its initial investments, Chennai-based Hathor is developing semi-cryogenic and cryogenic rocket engines for small and medium satellite launch vehicles.
Delhi-based Quanastra is building single-photon detection systems and quantum instrumentation for research and industrial applications.
Triolt Energy develops lithium-ion battery cells for drones and fast-charging electric mobility applications, while Carbelim uses microalgae technology in carbon capture and air purification systems.
Beyond investments from the fund, Unicorn India Ventures plans to mobilise additional capital through co-investments to support portfolio startups’ funding needs.
The first close follows Unicorn India Ventures’ ₹1,200 Cr final close of its third fund in February, exceeding its ₹1,000 Cr target. The fund invests across areas including semiconductors, quantum sensing, defence tech, and spacetech.
Other investors have also announced dedicated funds for these sectors. On September 18, Asiana Fund and Taiwan-based JC Capital launched a ₹1,000 Cr fund targeting advanced manufacturing and robotics, semiconductors and computing, materials and sustainability, and aerospace and defence.
Meanwhile, IIT Madras Research Park has been a significant contributor to the country’s deeptech innovation space, having incubated over 480 deeptech startups, 190 of which are now commercially active. Of these, two startups have reached unicorn valuation — Ather Energy and Uniphore.
Editor’s Note: This story has been updated to include Finance Minister Nirmala Sitharaman’s comments at the IIT Madras event.
Source: Inc42
