Karnataka selects seven deeptech startups for state-backed growth support

The Karnataka government’s IT/BT department has chosen seven deeptech startups for its Innoverse programme, which will provide assistance with market access, capital, policy, and infrastructure. The group includes AquaAirX Autonomous Systems, Fibroheal Woundcare, Hyspace Technologies, OptM Media Solutions, SpaceFields, UNMANND Autonomy, and one startup working in navigation and sensing.

The initiative stands out as a rare example of state-level involvement in a segment that has seen steady early-stage activity but limited follow-on investment. Recent discussions at industry events highlighted this issue, noting that while seed funding is available, startups in hardware-heavy or long-development fields often struggle to secure later rounds. Karnataka’s programme aims to reduce some of those risks, a role usually played by venture capital or corporate investors.

Bengaluru’s role as a major hub for startup activity makes the state’s participation unsurprising. The city has hosted events focused on deeptech, including a recent summit in Kochi, and earlier this month, the central government proposed exploring international partnerships to support early-stage funding in the sector. Innoverse appears to be a local response to similar needs, targeting startups that have moved beyond initial funding but lack the resources to expand.

The programme’s emphasis on market access and policy support suggests an awareness of the non-financial barriers these startups face. Regulatory processes, certification, and procurement in sectors like aerospace, defence, and biotech can be lengthy, and state backing might help speed up those steps. For example, startups working on propulsion or space technology could gain from access to testing facilities, while a biotech startup might benefit from connections to public health networks.

However, the programme’s impact will depend on how well it is implemented. Similar initiatives in India have sometimes faced delays or bureaucratic challenges. The IT/BT department’s announcement does not detail the amount of capital involved or the timeline for support, which could affect expectations. If successful, the programme might serve as an example for other regions, though few have the same concentration of deeptech startups as Karnataka.

The selection of startups is notable. Several work in areas where the government is a key customer or regulator, such as aerospace, defence, or space. This alignment suggests the programme may be as much about advancing national priorities as it is about commercial growth. Whether this focus will leave room for startups with broader applications remains unclear.

For founders, the programme could provide critical support in an environment where deeptech startups often struggle to secure larger funding rounds. While some startups have raised significant amounts, most find it difficult to scale. Innoverse may not replace private investment, but it could help startups reach milestones that make them more attractive to investors.

The programme’s success will hinge on execution. If it delivers, it could encourage other states to adopt similar approaches. If it falters, the funding challenges for deeptech startups will likely persist, leaving India’s ambitions in critical technologies dependent on private capital.

Sources: economictimes.indiatimes.com