Yali Capital Raises ₹893 Crore for Deeptech Investment in India

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News Summary

“Yali Capital raises ₹893 Crore” is a milestone in India’s deeptech venture capital scene. The fund, launched as Yali Capital’s maiden deeptech-focused vehicle, has closed at ₹893 crore (~USD 104 million), a strong overachievement of its ₹500 crore target plus ₹310 crore greenshoe option. This move signals growing investor confidence in India’s tech ecosystem and a pivot toward deeptech innovation.

Founded by Ganapathy Subramaniam and Mathew Cyriac, Yali Capital operates via a SEBI‑registered Category II Alternative Investment Fund (AIF) and a feeder vehicle based in GIFT City. The AIF will invest across early-stage (Seed, Series A) and late-stage (Series D and beyond) ventures, concentrating on sectors such as semiconductors, AI, robotics, genomics, aerospace/surveillance, and smart manufacturing. Backing comes from corporates like Infosys, Qualcomm Ventures, and Tata AIG; institutional support includes the DPIIT Fund of Funds for Startups and the Self‑Reliant India Fund. Leading individual investors such as Kris Gopalakrishnan, Gopal Srinivasan, Vallabh Bhansali, and others also participate.

Yali Capital has already deployed capital into five companies, including C2I Semiconductor, 4basecare, and Perceptyne. The firm aims to build the portfolio to eight companies by year-end and continue active deployment over the next four years. Its model blends patient capital, sector focus, and global partnership to drive India’s deeptech agenda forward.

The fund’s success provides timely lessons on fundraising strategy, deep tech investment, and startup ecosystem building in India, particularly highlighting the role of cross‑sector investors and long‑term vision.

1. Introduction

1.1 Why “Yali Capital Raises ₹893 Crore” matters

In a year when venture capital flows into Indian deep tech have surged, the news that Yali Capital raises ₹893 Crore marks a landmark moment. This achievement underscores investor belief in India’s capability to build globally competitive deeptech firms across sectors like AI, semiconductors, genomics, and robotics.

1.2 Context in India’s venture capital and startup ecosystem

The Indian startup ecosystem is increasingly exploring deeptech ventures. Traditional software and consumer internet firms are no longer the only frontier. Investments into deeptech paused by long gestation periods, high R&D cost, and technical risk are now rising. For instance, between January and March this year, 24 deeptech startups in India raised around USD 169 million—versus 17 startups amounting to USD 107 million in the same period of 2024. This signals fast‑growing interest in emerging technologies. Yali Capital’s fund‑raise captures and amplifies this momentum.

2. Yali Capital: Working Model and Structure

2.1 Dual structure: AIF + GIFT City feeder vehicle

Yali Capital employs a dual structure. On one hand, it operates a SEBI‑registered Category II AIF that complies with Indian regulatory norms for venture funds. On the other, a GIFT City‑based feeder vehicle enables global investors to participate. This structure allows seamless cross-border capital flows while maintaining a compliance centre of excellence within India.

2.2 Sector thesis and investment structure

The fund divides its capital across two core stages:

• Early stage (Seed, Series A): Two‑thirds of the fund (~₹595 crore) is dedicated to early‑stage deeptech firms.
• Late stage (Series D and beyond): One‑third (~₹298 crore) reserved for growth‑stage companies readying for global scale and public markets.

This structure reflects a long‑term funding mindset and deep confidence in deeptech startups capable of global competitiveness.

3. Revenue Model and Investment Strategy

3.1 Revenue model within fund structure

As an AIF, Yali Capital earns management fees and performance‑based carried interest. Returns depend on exit events such as IPOs, strategic acquisitions, or secondary sales. The firm aligns investor and founder incentives through structured, evergreen capital deployment over a four‑year horizon.

3.2 Investment strategy and deployment roadmap

Yali has already made five initial investments spanning chip design and AI. These include C2I Semiconductor, 4basecare, and Perceptyne. The strategy balances deep tech risk with promising teams, sector relevance, and global market potential. The aim is to grow the portfolio to eight companies by the end of the financial year and deploy capital steadily over the next four /*lyears, aligning with long R&D cycles typical of deeptech ventures.

4. Founders, Background, and Origins

4.1 Founding partners and leadership

Ganapathy Subramaniam, co‑founder of Cosmic Circuits, brings semiconductor and chip design expertise. Mathew Cyriac, former India co‑head at Blackstone, contributes global investment experience. Their combined backgrounds blend technical depth and institutional capital management.

4.2 Genesis of Yali Capital

Yali Capital was conceived to address a gap: India lacked a deep‑tech‑focused fund with long‑term capital and global access. The founders saw strong potential in robotics, semiconductors, and AI built in India, but few funds were willing to take that risk. They built a model that bridges domestic regulatory frameworks with global investor appetite via GIFT City.

5. Services, Products, and Problems Solved

5.1 Focus areas: deeptech sectors

Yali’s fund targets sectors that require significant research, technical talent, and capital deployment:

• Semiconductors: Chip design and hardware innovation.
• AI and robotics: Autonomous systems and machine intelligence.
• Genomics: Biotech platforms and precision healthcare.
• Aerospace/surveillance: Defence, satellite, and drone technologies.
• Smart manufacturing: Industrial IoT and automation.

5.2 Problems addressed by the startups

These deeptech startups seek to solve:

• Dependence on global supply chains for chips and hardware.
• Gaps in diagnostics and healthcare using genomics and AI.
• Fragmented manufacturing inefficiencies.
• A shortage of locally built, high‑end engineering platforms.

Through their products, Yali’s portfolio aims to provide home‑grown alternatives, create technical depth, and drive India toward self‑reliance in technology.

6. Industry Growth Trends and Macro Insights

6.1 Growth of deeptech funding in India

Deeptech funding in India is rising sharply. Q1 2025 saw INR 1,400+ crore invested in only 24 startups, up significantly year‑on‑year. Investors are increasingly allocating capital to high‑development, high‑impact ventures.

6.2 Government and institutional support

Government programmes like DPIIT’s Fund of Funds and Self‑Reliant India Fund demonstrate institutional confidence in tech innovation. Yali’s backing from these vehicles reflects broader policy support for local deeptech development.

6.3 Global appetite and partnerships

Investors such as Infosys, Qualcomm Ventures, and Tata AIG bring domain expertise and scale. Guidance from advisors like Lip‑Bu Tan, Intel’s CEO and veteran investor, further validates Yali’s thesis and attracts global capital.

7. Competition and Ecosystem Dynamics

7.1 Direct competitors

Yali’s peer funds include other Indian and global funds focused on deeptech, such as global semiconductor and robotics‑focused VCs, or Indian deeptech platforms like Blume Ventures, pi Ventures, and Stellaris Venture Partners. These firms also invest in AI, robotics and frontier tech.

7.2 Indirect competitors

Standard tech and software VCs indirectly compete for capital allocation. While those funds flow into consumer internet and fintech, Yali’s deeptech focus gives it a distinct positioning.

7.3 Strategic differentiation

Yali differentiates via its dual structure, technical founders, and long‑term capital model. It offers stronger alignment with deeptech founders facing longer commercialization timelines.

8. Timeline and Journey

8.1 Startup origin to fund closure

• Idea conceived by Ganapathy Subramaniam and Mathew Cyriac, combining tech and investment leadership.
• Structural design of a dual SEBI‑registered AIF and GIFT City global feeder vehicle.
• LP commitment secured from corporates, institutional funds and entrepreneurs.
• Initial deployment across five deeptech startups including chip design and AI firms.
• Closure achieved at ₹893 crore, surpassing ₹500 crore goal plus ₹310 crore greenshoe.

8.2 Progress to deployment and portfolio development

Yali already holds five investments. It plans to grow the portfolio to eight startups by year‑end. Deploying across early and late stage over the next four years ensures patient capital for high‑tech ventures.

9. Financial Implications and Market Response

9.1 Investor confidence and validation

Exceeding the fundraising target by nearly 80% reflects strong belief among corporates, entrepreneurs, and government‑backed institutions in India’s deeptech potential.

9.2 Catalytic effect on deeptech ecosystem

Yali’s fundraising success is likely to attract similar funds, accelerate grants, and drive more startups into sectors like semiconductors and robotics.

9.3 Long-term return potential

If Yali’s portfolio firms achieve success, exits via IPOs or acquisitions may generate significant returns. It’s a patient capital model that supports founder vision and industrial innovation.

10. Strategic Lessons for the Startup Community

10.1 Learning for Startups and Entrepreneurs

• Think long‑term: Deeptech investments require long horizons. Patient capital aligned with R&D is vital.
• Build credibility: Attract institutional and corporate LPs by demonstrating technical domain and execution pedigree.
• Use smart structures: A dual‑structure like SEBI AIF + GIFT City feeder helps bridge domestic compliance and global capital.
• Sector discipline: A sharp sector focus builds expertise and better deal sourcing.
• Balance stage mix: Funding both early and late stages offers diversification and exit flexibility.
• Network globally: Advisors like Lip‑Bu Tan bring credibility and open doors to global tech ecosystems.

About Foundlanes

foundlanes.com is a dedicated news and startups stories platform covering the latest trends, insights, and stories from the Indian and global startup ecosystem. In light of Yali capital raises ₹893 Crore, The Startups News underscores the importance of deeptech narratives in India’s startup landscape. Their coverage typically highlights founding stories, investor confidence, government support structures, and deeptech breakthroughs. Yali Capital closure aligns with The Startups News’ mission to showcase entrepreneurial innovation and strategic funding events shaping the ecosystem.