The venture capital (VC) landscape witnessed a surge in activity in 2024, with over 30 new VC firms entering the market. This trend is expected to accelerate in 2025, driven by increasing interest from limited partners (LPs) and a growing number of entrepreneurs seeking domain-specific expertise. Among the notable entrants this year were MudhalVC, Playbook Partners, BlueGreen Ventures, Promaft Partners, Optimistic Capital, and Zeropearl.
Many of these firms are led by seasoned founders, CEOs, and investors who have exited their previous ventures, turning fund management into a natural career progression. For example, former Orios Venture Partners managing partners Anup Jain and Rajeev Suri launched BlueGreen Ventures, a $75-million fund aimed at early-stage startups and IPO-ready firms. Similarly, Bipin Shah, previously with Titan Capital, unveiled his micro-VC firm, Zeropearl. Kissflow founder Suresh Sambandam established MudhalVC to nurture idea-stage startups in Tamil Nadu, with a focus on tier-2 and tier-3 cities.
“The continued innovation in new economy businesses, paired with their need for growth capital, makes this an exciting time for specialist investors like us,” said Vikas Choudhary, founder of Playbook Partners.
Choudhary, who has a background with Pivot Ventures and Reliance Jio, said Playbook Partners targets tech-driven companies with revenues above Rs 200 crore and positive operating margins.
Experts see this new wave of boutique VCs as a significant shift in India’s investment ecosystem. “These firms represent a new generation of investors focused on specialisation, founder-first principles, and regional opportunities,” said Milan Sharma, founder and MD of 35North Ventures.
India, with 1,812 VC firms, remains the world’s third-largest startup ecosystem, after the US and China, according to Tracxn. Comparatively, the US and China have around 2,800 and 2,280 active firms, highlighting India’s potential for further growth.
The influx of domestic and international capital is also propelling the sector forward. Institutional investors, including pension and sovereign wealth funds, are directing more resources towards Indian startups, following the success of giants like Sequoia Capital India and Accel Partners.
“Economic uncertainty in 2024 created opportunities for agile VC firms to address gaps overlooked by traditional funds,” said Chirag Shah, president of fundraising and strategy at BlackSoil.
Regional opportunities in tier 3 and 4 cities as well as underexplored areas like the North-East are additional growth avenues for these new VCs. Emerging LPs, such as family offices and high net-worth individuals, are also backing smaller, more agile funds.
With government initiatives like Startup India and tax incentives for alternative investment funds (AIFs), the climate for VC formation has never been more favourable. However, differentiation will be key to survival. “Firms that fail to offer a compelling edge – whether through sector expertise, founder networks, or operational value-add – may struggle to gain traction,” Sharma cautioned.
