No startup survives in India? What young founders told us
Why India has struggled to make its startup story as big a success as China's or the US's – especially in core technology, deep tech, and AI – may be best understood through the voices of young founders. Indian innovators believe that the very challenges that exist in India shape the creation of an ecosystem where startups can truly survive.
Anagha Rajesh, a BITS Pilani graduate, had worked hard for the last two years on one of the country's most unusual deep-tech bets. She decided to work on something beyond the ordinary: storing data in bacteria DNA. She raised funding of Rs 5 crore in two years, including from Nikhil Kamath. But she feels India’s startup ecosystem cannot give her idea the right juncture that she desires.
What she was building could have brought the cost of storing data in DNA from Rs 3,50,000 to Rs 100 per MB. The prototype was built, but the later phases required a more in-depth approach, and here India failed her, just like many young ideas fail at that stage.
She highlighted the problem as: “India has money but less patience.”
The same words were echoed by 24-year-old Indian Raahul Hari Nair, who is now in the USA and built CHIGRIDS. “There are very few investors who can remain patient for the long term, with the mindset of getting quick results influencing investment decisions. This results in the migration of startups and weakens their chances of survival in India.”
India’s startup journey has seen everything in one frame, unicorns, breakout founders, funding winters, big failures, policy pushes, and the rise of entrepreneurship as a mainstream aspiration.
THE YOUNG FOUNDERS WHO CHOOSE TO LEAVE
New ideas today are not dismissed as casually as they once were. In cities and smaller towns alike, young founders are building, pitching, and trying to solve real problems.
Yet beneath the celebration of India’s startup rise sits a harder story, one that is not only about shutdowns or valuation crashes. It is about founders, especially younger founders, increasingly choosing to leave.
More than 6,700 registered startups have shut down in the last five years, where it reflects the fragility of the ecosystem. Hundreds have left the country and more are planning to go just like Anagha.
Silicon Valley remains the destination of choice. India Today spoke to two young entrepreneurs based abroad, the founders of CHIGRID and Shop Culture – who built promising ventures and are now running them from thousands of miles away.
Be it Raahul Hari Nair, 24, or Subarna, 35, a common thread runs through their accounts: a lack of trust in young founders, especially when a founder is trying to build something ambitious and long-term. Infrastructure, they say, is another challenge.
Many ideas emerge and die, but for Subarna, the decision to move out worked.
"The idea has been there for very long actually.. Originated when I was in India.. but eventually launched after I moved out." she adds.
Subarna worked on the idea in India, but she chose to leave in 2021. This is a post-pandemic story. She felt the constraints even then and decided to migrate.
Even if the capital is present, conviction often is not for young ideas.
“Capital remains a major challenge. In the US, even if the money belongs to an older generation, decisions on where and how to invest can still be taken by younger people who understand the space. That chain works differently there. In India, it doesn’t. Customers, too, are slower to give new ideas the recognition they need, while policy bottlenecks and bureaucracy continue to weigh startups down,” Nair says.
Be it Emergent, now moved to San Francisco, Atomicwork, Composio, Smallest.ai, Beatoven.ai, or GetCrux, seed funding for many of them came from India, but the dream of scaling big is taking shape in Silicon Valley. Strategy and team-building, too, are being done in the Valley.
We also spoke with a 22-year-old innovator, Mehak Parvez, a Chennai-born founder currently pursuing a programme in the US, who worked tirelessly to build an innovative cold storage solution for Indian farmers.
Along with her sister, she developed a prototype and is now working on the next stages. She believes that the challenges in India are giving young minds the opportunity to solve problems and create opportunities. “India has its problems, and the US has its own. The support system is present in both countries. Comparing the two is tough, but many things are happening in India too.”
WHY STARTUPS MOVE WHERE THE MARKET IS
Anagha Rajesh has chosen to move her startup BioCompute to the US as it shifts from prototype to product.
Her explanation was telling: India, she said, still lacks the ecosystem needed for high-risk deep-tech innovation, not only capital, but also talent density, customer appetite, and the kind of foresight that such bets demand.
It is easy to call it brain drain. It is harder, but more honest, to call it a systems problem.
This is not merely anecdotal. It was only a few years ago that Indian-American entrepreneur M R Rangaswami spelt out what was beginning to happen. He said successful Indian startups had gradually started moving their base to Silicon Valley to claim a share of the American market.
His estimate was striking: over 100 highly successful Indian startups had moved to the US in just three to four years.
Rangaswami pointed to a basic consumer and market problem. Many SaaS and enterprise startups are built in India using Indian talent, but their biggest customers are in the US, the world’s largest IT market.
Once the product is ready, founders move to where the customers, capital, and strategic networks already are.
That is where the old India story begins to return in a new form.
In the IT services era, India got a slice of the pie America served on the table. China, meanwhile, did not stop at taking a bite. It learnt to build the cake - manufacturing, deep capability, domestic scale, state support, and the discipline to stay the course.
India’s startup sector now risks repeating a version of that pattern. We produce talent, prototypes, and early-stage ideas; the scale, the market capture, and often the eventual company-building happen elsewhere.
THE PATIENCE PROBLEM IN INDIA’S STARTUP ECOSYSTEM
For a young founder to identify the challenge of capital in uncommon startups like in the field of deep tech tells the industry reality which tend not to change so fast.
"For technology and services startups in India, the problem is not funding but the expectation of quick returns. That works for consumer tech, but not for deep-tech ideas that need long-term research, patient capital and years before results begin to show," adds Subarna, who runs an e-commerce strategy platform.
This matters even more in the age of AI and deep tech, where the race is not only about coding talent but also about capital, and patience. The US remains overwhelmingly ahead in venture appetite.
Global data shows American investors continue to dominate AI financing, while India’s funding base remains much thinner.
India has announced a serious push through the IndiaAI Mission, over Rs 10,300 crore and 38,000 GPUs over five years, and the country can point to genuine strengths.
Government data says India is home to 16 per cent of the world’s AI talent, and the country ranks first in global AI skill penetration. But talent by itself does not become a company. A mission does not automatically become a market.
The mismatch is visible in how money is deployed.
A SenseAI report on India’s AI landscape has pointed out that most Indian AI funding is flowing into the application layer rather than into foundational or harder infrastructure bets. That is not wrong in itself; application-layer companies can build strong businesses.
But it also shows the shape of investor comfort. India still prefers what can be monetised faster, explained more easily, and exited more neatly. Deep-tech founders, by contrast, are asking for time, tolerance, and a belief that some of the biggest returns come from the least immediately legible ideas.
Nair, who studied in the US and now works on an energy-sector startup, put the founder frustration plainly: “The lack of faith in young minds by investors never lets you work freely. Even if you get the funding, the expected output timeline always hovers over you. It never lets you work and focus on the R&D part.”
His words capture the fault line in India’s startup model. In India, even when seed money arrives, it often arrives with a clock attached.
That is why validation from outside still commands respect inside. A founder who is funded in San Francisco is often taken more seriously in Bengaluru or Mumbai.
There are angel networks, startup funds, accelerators, and government programmes. But the jump from a promising prototype to a mature deep-tech company remains weak.
Long-term investment is still too limited, and the burden of R&D continues to fall heavily on the state, for 75% it is responsible.
Congress MP Shashi Tharoor recently pointed to precisely this problem – short-termism, an old mindset that hesitates before high-risk, high-reward bets, and inadequate long-horizon investment in innovation.
Even the broader funding climate has turned harsher. Startup funding in India fell sharply during the recent West Asia crisis, with late-stage funding taking a major hit and seed-stage capital also slowing.
That volatility makes investors even more cautious.
China’s rise showed what long-term discipline, strategic patience, and domestic belief can do. India’s problem is not only capital or policy. It is also discipline.
Anagha Rajesh, a BITS Pilani graduate, had worked hard for the last two years on one of the country's most unusual deep-tech bets. She decided to work on something beyond the ordinary: storing data in bacteria DNA. She raised funding of Rs 5 crore in two years, including from Nikhil Kamath. But she feels India’s startup ecosystem cannot give her idea the right juncture that she desires.
What she was building could have brought the cost of storing data in DNA from Rs 3,50,000 to Rs 100 per MB. The prototype was built, but the later phases required a more in-depth approach, and here India failed her, just like many young ideas fail at that stage.
She highlighted the problem as: “India has money but less patience.”
The same words were echoed by 24-year-old Indian Raahul Hari Nair, who is now in the USA and built CHIGRIDS. “There are very few investors who can remain patient for the long term, with the mindset of getting quick results influencing investment decisions. This results in the migration of startups and weakens their chances of survival in India.”
India’s startup journey has seen everything in one frame, unicorns, breakout founders, funding winters, big failures, policy pushes, and the rise of entrepreneurship as a mainstream aspiration.
THE YOUNG FOUNDERS WHO CHOOSE TO LEAVE
New ideas today are not dismissed as casually as they once were. In cities and smaller towns alike, young founders are building, pitching, and trying to solve real problems.
Yet beneath the celebration of India’s startup rise sits a harder story, one that is not only about shutdowns or valuation crashes. It is about founders, especially younger founders, increasingly choosing to leave.
More than 6,700 registered startups have shut down in the last five years, where it reflects the fragility of the ecosystem. Hundreds have left the country and more are planning to go just like Anagha.
Silicon Valley remains the destination of choice. India Today spoke to two young entrepreneurs based abroad, the founders of CHIGRID and Shop Culture – who built promising ventures and are now running them from thousands of miles away.
Be it Raahul Hari Nair, 24, or Subarna, 35, a common thread runs through their accounts: a lack of trust in young founders, especially when a founder is trying to build something ambitious and long-term. Infrastructure, they say, is another challenge.
Many ideas emerge and die, but for Subarna, the decision to move out worked.
"The idea has been there for very long actually.. Originated when I was in India.. but eventually launched after I moved out." she adds.
Subarna worked on the idea in India, but she chose to leave in 2021. This is a post-pandemic story. She felt the constraints even then and decided to migrate.
Even if the capital is present, conviction often is not for young ideas.
“Capital remains a major challenge. In the US, even if the money belongs to an older generation, decisions on where and how to invest can still be taken by younger people who understand the space. That chain works differently there. In India, it doesn’t. Customers, too, are slower to give new ideas the recognition they need, while policy bottlenecks and bureaucracy continue to weigh startups down,” Nair says.
Be it Emergent, now moved to San Francisco, Atomicwork, Composio, Smallest.ai, Beatoven.ai, or GetCrux, seed funding for many of them came from India, but the dream of scaling big is taking shape in Silicon Valley. Strategy and team-building, too, are being done in the Valley.
We also spoke with a 22-year-old innovator, Mehak Parvez, a Chennai-born founder currently pursuing a programme in the US, who worked tirelessly to build an innovative cold storage solution for Indian farmers.
Along with her sister, she developed a prototype and is now working on the next stages. She believes that the challenges in India are giving young minds the opportunity to solve problems and create opportunities. “India has its problems, and the US has its own. The support system is present in both countries. Comparing the two is tough, but many things are happening in India too.”
WHY STARTUPS MOVE WHERE THE MARKET IS
Anagha Rajesh has chosen to move her startup BioCompute to the US as it shifts from prototype to product.
Her explanation was telling: India, she said, still lacks the ecosystem needed for high-risk deep-tech innovation, not only capital, but also talent density, customer appetite, and the kind of foresight that such bets demand.
It is easy to call it brain drain. It is harder, but more honest, to call it a systems problem.
This is not merely anecdotal. It was only a few years ago that Indian-American entrepreneur M R Rangaswami spelt out what was beginning to happen. He said successful Indian startups had gradually started moving their base to Silicon Valley to claim a share of the American market.
His estimate was striking: over 100 highly successful Indian startups had moved to the US in just three to four years.
Rangaswami pointed to a basic consumer and market problem. Many SaaS and enterprise startups are built in India using Indian talent, but their biggest customers are in the US, the world’s largest IT market.
Once the product is ready, founders move to where the customers, capital, and strategic networks already are.
That is where the old India story begins to return in a new form.
In the IT services era, India got a slice of the pie America served on the table. China, meanwhile, did not stop at taking a bite. It learnt to build the cake - manufacturing, deep capability, domestic scale, state support, and the discipline to stay the course.
India’s startup sector now risks repeating a version of that pattern. We produce talent, prototypes, and early-stage ideas; the scale, the market capture, and often the eventual company-building happen elsewhere.
THE PATIENCE PROBLEM IN INDIA’S STARTUP ECOSYSTEM
For a young founder to identify the challenge of capital in uncommon startups like in the field of deep tech tells the industry reality which tend not to change so fast.
"For technology and services startups in India, the problem is not funding but the expectation of quick returns. That works for consumer tech, but not for deep-tech ideas that need long-term research, patient capital and years before results begin to show," adds Subarna, who runs an e-commerce strategy platform.
This matters even more in the age of AI and deep tech, where the race is not only about coding talent but also about capital, and patience. The US remains overwhelmingly ahead in venture appetite.
Global data shows American investors continue to dominate AI financing, while India’s funding base remains much thinner.
India has announced a serious push through the IndiaAI Mission, over Rs 10,300 crore and 38,000 GPUs over five years, and the country can point to genuine strengths.
Government data says India is home to 16 per cent of the world’s AI talent, and the country ranks first in global AI skill penetration. But talent by itself does not become a company. A mission does not automatically become a market.
The mismatch is visible in how money is deployed.
A SenseAI report on India’s AI landscape has pointed out that most Indian AI funding is flowing into the application layer rather than into foundational or harder infrastructure bets. That is not wrong in itself; application-layer companies can build strong businesses.
But it also shows the shape of investor comfort. India still prefers what can be monetised faster, explained more easily, and exited more neatly. Deep-tech founders, by contrast, are asking for time, tolerance, and a belief that some of the biggest returns come from the least immediately legible ideas.
Nair, who studied in the US and now works on an energy-sector startup, put the founder frustration plainly: “The lack of faith in young minds by investors never lets you work freely. Even if you get the funding, the expected output timeline always hovers over you. It never lets you work and focus on the R&D part.”
His words capture the fault line in India’s startup model. In India, even when seed money arrives, it often arrives with a clock attached.
That is why validation from outside still commands respect inside. A founder who is funded in San Francisco is often taken more seriously in Bengaluru or Mumbai.
There are angel networks, startup funds, accelerators, and government programmes. But the jump from a promising prototype to a mature deep-tech company remains weak.
Long-term investment is still too limited, and the burden of R&D continues to fall heavily on the state, for 75% it is responsible.
Congress MP Shashi Tharoor recently pointed to precisely this problem – short-termism, an old mindset that hesitates before high-risk, high-reward bets, and inadequate long-horizon investment in innovation.
Even the broader funding climate has turned harsher. Startup funding in India fell sharply during the recent West Asia crisis, with late-stage funding taking a major hit and seed-stage capital also slowing.
That volatility makes investors even more cautious.
China’s rise showed what long-term discipline, strategic patience, and domestic belief can do. India’s problem is not only capital or policy. It is also discipline.
