A Clear Pathway for Startup Leaders in India
Prashanth Prakash, Founding Partner - Accel India and Chairman, Vision Group on Startups—Government of Karnataka, 0
It's really amazing to see new benchmarks and new levels set every year for the Bengaluru Tech Summit 2024. This year, I think there are two areas that will define the next two years. One is what I would like to call ‘people plus AI.’
LLMs Lack Specificity to Address Problems in Health and Finance
We are all excited about LLMs (Large Language Models) and their unique capabilities. There's an opportunity in India to build LLMs for our native languages. But these LLMs are not really predictive by themselves. They lack the right kind of specificity to address the problems in health and finance by themselves. This is where the concept of ‘people plus AI’ comes in.
The Real Power is in the Knowledge Graphs and Neural Networks
LLMs need knowledge graphs. Knowledge graphs are not a new concept. It's typical of the IT industry to get all excited and hyped about generating something. But the real value is not in that hype. It is in embracing that and building around that. LLMs are known to significantly aid in communicating knowledge/information to the end user. However, the real power is in the knowledge graphs and the neural networks.
Today, we’ve honed the capability to marry the LLMs in technology and unleash a new AI model. But whether it's in healthcare, the legal domain or the finance domain, you can't use or consume information directly produced by AI. You need humans.
You Need a Human to Examine Everything Produced by AI
Since there are possibilities of multiple edge cases, the involvement of mankind takes a huge stake. You need people to see if edge cases are analyzed correctly. I believe this is where India's power comes into play.
India Has a Unique Advantage Here
Now, when I say India's power, I don’t necessarily mean our engineering capability to build the application layers. Take the US tech industry, for instance. About 5 to 10 percent of all employees hired in the US tech industry will be AI-first employees, which means they are agent-first employees (a concept in software development that refers to the ability to prioritize and sort through data based on its timeliness). However, agent-first employees cannot work in a vacuum. They need to collaborate with people and cohabitate with real people.
I think that's where India has the power to marry the next generation of AI with capable talent. Not to mention the multiple AI-first real startups that exist in the country.
Precision Manufacturing
Karnataka stems from a rich background in aerospace, which now has the ability to combine aerospace robotics and precision manufacturing. This is a different capability that no other state can boast of, thanks to the state’s aerospace and engineering capabilities.
Besides, the country already houses more than
15 to 20 startups that are ready for aerospace and building for precision manufacturing.
Novel Materials that Are Bio-led
There is support for new raw materials as well. For instance, today, companies manufacture bio leather, which is sustainable with no carbon footprint or embedded carbon. Again, this is a huge opportunity for startups.
What Makes it a Great Opportunity for Startups?
The Global South currently faces a manufacturing vacuum due to the declining favorability of a previously dominant single-source supplier. Consequently, global consumers are seeking diversified supply chains. India stands out as a nation capable of delivering such diversified supply chains at scale, particularly in areas of advanced science and manufacturing. The future lies not only in software but also in intelligent, rather than merely heavy, assets. As a state, we must now focus on integrating software with smart manufacturing and sustainability to drive progress.
On Track With the IPO
On a broader view, the good news is that the country has caught up to the IPO pace. There is Swiggy, which was the ninth-largest-ever IPO in India. Ola Electric had an IPO. BlackBuck has already gone for IPO, and there are three more IPOs lined up. My prediction for next year is that we will have as many IPOs from Bangalore.
This Has Been the Best Season for Funding
This quarter has been the best for funding in the last three years. We have had 100 percent growth in funding year-on-year. This quarter, the nation has had almost $3.4 billion in new funding in the venture ecosystem. This is where I’d like to say that Bangalore takes a special place. It’s not often talked about, and I’d like to focus the limelight on how 90 percent has been on venture funds now. This is a very interesting phenomenon and the first ever since the startup ecosystem bloomed.
It did not commence from Bangalore alone but was almost equally distributed between Mumbai, Delhi and Bangalore. When it comes to the vibrancy of the startup ecosystem, what makes Silicon Valley special is truly the funding, which I believe is where the state excels. This is a huge differentiator for early-stage innovation, considering that most are deep tech funds. So, it's the right time for entrepreneurs.
Defense
There is a net deficit of production capacity in the defense field, just like in aviation. While countries like Russia and the US are already caught up in their own challenges, India could have a lot of startups in 10 years. About 67 startups have just started, and there's a lot of intersection between precision manufacturing and new materials, which is a great start.
The Time is Ripe for Entrepreneurs to Drive Economic Growth
I believe entrepreneurs have the capability to marry their prowess and innovation in global markets to help India reach the $5 trillion economy or $7 billion economy goal. That's where the opportunity lies now. Funding is not at all a problem now, as enough funding is happening.
The mission now is to support these entrepreneurs and help them realize their unbounded potential, which is what I press on.
Novel Materials that Are Bio-led
There is support for new raw materials as well. For instance, today, companies manufacture bio leather, which is sustainable with no carbon footprint or embedded carbon. Again, this is a huge opportunity for startups.
The mission now is to support these entrepreneurs and help them realize their unbounded potential, which is what I press on.
What Makes it a Great Opportunity for Startups?
The Global South currently faces a manufacturing vacuum due to the declining favorability of a previously dominant single-source supplier. Consequently, global consumers are seeking diversified supply chains. India stands out as a nation capable of delivering such diversified supply chains at scale, particularly in areas of advanced science and manufacturing. The future lies not only in software but also in intelligent, rather than merely heavy, assets. As a state, we must now focus on integrating software with smart manufacturing and sustainability to drive progress.
On Track With the IPO
On a broader view, the good news is that the country has caught up to the IPO pace. There is Swiggy, which was the ninth-largest-ever IPO in India. Ola Electric had an IPO. BlackBuck has already gone for IPO, and there are three more IPOs lined up. My prediction for next year is that we will have as many IPOs from Bangalore.
This Has Been the Best Season for Funding
This quarter has been the best for funding in the last three years. We have had 100 percent growth in funding year-on-year. This quarter, the nation has had almost $3.4 billion in new funding in the venture ecosystem. This is where I’d like to say that Bangalore takes a special place. It’s not often talked about, and I’d like to focus the limelight on how 90 percent has been on venture funds now. This is a very interesting phenomenon and the first ever since the startup ecosystem bloomed.
It did not commence from Bangalore alone but was almost equally distributed between Mumbai, Delhi and Bangalore. When it comes to the vibrancy of the startup ecosystem, what makes Silicon Valley special is truly the funding, which I believe is where the state excels. This is a huge differentiator for early-stage innovation, considering that most are deep tech funds. So, it's the right time for entrepreneurs.
Defense
There is a net deficit of production capacity in the defense field, just like in aviation. While countries like Russia and the US are already caught up in their own challenges, India could have a lot of startups in 10 years. About 67 startups have just started, and there's a lot of intersection between precision manufacturing and new materials, which is a great start.
The Time is Ripe for Entrepreneurs to Drive Economic Growth
I believe entrepreneurs have the capability to marry their prowess and innovation in global markets to help India reach the $5 trillion economy or $7 billion economy goal. That's where the opportunity lies now. Funding is not at all a problem now, as enough funding is happening.
The mission now is to support these entrepreneurs and help them realize their unbounded potential, which is what I press on.