E-commerce loses allure, investors kickoff hunt to fund deep tech start-ups

IDG Ventures, in partnership with Axilor today launched the hunt, reports Tech in Asia

Not long ago, India’s startup scene was all about the consumer internet. A billion-strong people taking to the internet riding on smartphones made it seem like a market just about to ripen. Investors in all shapes and sizes – from newbie angels to behemothic hedge funds – raced to bet on e-commerce plays and a hundred apps mushrooming all over the country. But that lap of the investment race is over with no winners, dead or dying companies, and a funding winter.

IDG Ventures, which invested in India’s e-commerce leaders like Flipkart, Myntra, and Yatra, today launched a hunt to find and fund deep tech startups, in partnership with Bangalore-based accelerator and seed fund Axilor. Virtual reality/augmented reality, space, drones, robotics, artificial intelligence, bitcoin, and blockchain are some of the domains that would come under the program’s purview.

IDG has already invested in deep tech startups such as Active.ai, Sigtuple, Hansel.io, Infisecure, Forus, Perfint, Axio, and Iviz.

Axilor’s strategy too has been along the same lines. The accelerator, which was launched in November 2014, has its eye on five sectors: artificial intelligence, fintech, healthtech, enterprise and SaaS (software-as-a-service), apart from consumer internet.

The FTIP2017 is now open for applications. Around 25 startups will be shortlisted for investment and other support, Sanat says.

The shift to deep tech comes at a time when consumer internet startups in India are clocking huge losses, laying off large numbers of employees, or simply shutting down as they reach the end of their runways. Their discount-led business models are under scrutiny and investors are asking hard questions on unit economics. The new interest in deep tech product startups comes with this backdrop.

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This is an excerpt from Tech in Asia. You can read the full article here