IIT Madras, IIT Madras Research Park and venture capital firm Unicorn India Ventures have announced the first close of their deep-tech fund at about ₹450 crore. The fund, called IITM Unicorn Frontier Fund-I, has a target size of ₹1,000 crore. The first close came just three months after the fund received approval from the Securities and Exchange Board of India, or SEBI.
The announcement took place at the IIT Madras Alumni Association’s Sangam 2026 conference in Bengaluru, in the presence of Union Finance Minister Nirmala Sitharaman. The fund now plans to raise the rest of its target amount, with the final close expected by December 2026.
The fund is aimed at a part of the startup sector that often needs more money and more time than regular software businesses. Deep-tech companies may spend years on research, product development, testing and approval before they reach a large market. The new fund is designed to give such companies access to patient capital during this difficult stage.
A ₹1,000 Crore Fund
The fund has a target corpus of ₹1,000 crore, which includes a ₹400 crore greenshoe option. A greenshoe option gives a fund the ability to raise extra capital beyond its initial target when investor demand is strong.
The first close of ₹450 crore is a major part of this target. Reports have also put the final first-close figure at around ₹453 crore, although the public announcement has widely described it as ₹450 crore.
The fund has received strong support from IIT Madras alumni and family offices. Institutional investors, companies and banks are expected to join before the final close. About one-third of the first-close capital has come from overseas investors, while the rest has come from India, according to Unicorn India Ventures Managing Partner Bhaskar Majumdar.
The quick fundraise also shows the role of the IIT Madras ecosystem. The institute has built a large research and startup network, and the new fund aims to help more ideas move from laboratories into real businesses.
Four Startups Already Have Support
The fund has already deployed nearly ₹55 crore across four deep-tech startups. These companies work across space technology, quantum technology, batteries and carbon capture.
One of them is Hathor, a Chennai-based space-tech company. Hathor works on semi-cryogenic and cryogenic rocket engines for small and medium satellite launch vehicles. Rocket engines require advanced engineering, large tests and a long path before commercial use. Capital at an early stage can help such companies build and test their technology.
The second startup is Quanstra, a Delhi-based quantum technology company. It works on single-photon detection systems and advanced quantum instrumentation. Such tools can support research as well as future industrial uses of quantum technology.
The third company is Triolt Energy. It develops high-performance lithium-ion battery cells for drones and fast-charging electric mobility. Better battery cells have importance across electric vehicles, drones and other forms of modern transport.
The fourth startup is Carbelim. It develops carbon capture and air purification systems with proprietary microalgae technology. Its work sits at the intersection of climate technology, industrial systems and air quality.
Together, these four investments show the type of technology that the fund wants to support. These are not simple consumer internet products. They depend on scientific research, engineering, hardware, testing and intellectual property.
Six Areas of Focus
The fund plans to focus on six major areas. These include defence technology, space technology, semiconductors, manufacturing technology, robotics and automation, AI infrastructure and generative AI, and health technology.
The focus also reflects areas where India wants stronger domestic technology. For example, the semiconductor sector needs local design and intellectual property. Defence technology can reduce dependence on imported systems. Space technology can support a larger private space industry.
AI infrastructure is another major area. While much of the public discussion around AI focuses on software applications, deep-tech companies also work on the hardware, systems and infrastructure that support AI.
Health technology is another key part of the plan. The fund can support companies that create new devices, systems and technologies for healthcare.
Focus on Early Technology
Most investments from the fund will target companies at Technology Readiness Levels, or TRLs, 3 and 4. These levels generally cover technology that has moved beyond basic research but still needs more development and testing.
This is an important part of the fund’s approach. A startup at this stage may have a strong scientific idea or working prototype, but it may still need years of work before it can sell the product at scale.
Traditional venture capital can sometimes find such companies difficult to fund because the path to revenue can be long. The IIT Madras-Unicorn India fund aims to fill part of that gap.
The fund expects an average investment of ₹15 crore to ₹25 crore per startup and aims to create a portfolio of about 25 companies.
Long-Term Capital Matters
Deep-tech startups have a different financial need from many software startups. A software company may build and launch a product in a short period. A company that develops a rocket engine, battery cell, semiconductor design or medical technology needs more time for research, tests, approvals and production.
The fund therefore plans to provide long-term capital. Unicorn India Ventures has also said it wants to build a co-investment system so portfolio companies can access more capital when they enter later funding rounds.
The fund has an eight-to-10-year investment horizon, according to Bhaskar Majumdar. The strategy also leaves room for follow-on investment in companies that need more money after their first round.
This can be important for deep-tech founders. A company may require a large amount of money not only to create its first working product but also to move from a prototype to commercial production.
From Research to Business
One of the main goals of the fund is to create a stronger link between research and business. IIT Madras already has research centres, an incubation ecosystem and the IIT Madras Research Park. The fund adds another layer by providing capital to companies that can take research ideas toward commercial use.
IIT Madras Director Professor V Kamakoti said the institute has built an ecosystem that has helped several deep-tech companies improve their technology readiness. The partnership with Unicorn India Ventures is meant to provide these companies with patient capital and strategic support.
IIT Madras Research Park Group CEO Natarajan Malupillai has also said the fund will bring long-term capital into the institute’s innovation ecosystem and help IP-led companies scale from India.
For founders, this can create a more direct path from research to a commercial company. For investors, it provides access to businesses based on science and engineering rather than only software or consumer models.
What Comes Next
The first close is only the start of the fund’s larger plan. It still aims to reach its full ₹1,000 crore target, with the final close expected by December 2026. More institutional investors, companies and banks are expected to take part at that stage.
The fund will continue to look for companies with strong intellectual property, deep engineering work and the potential to compete in global markets. It will also assess areas such as export potential, import replacement and domestic technology capability.
For India’s deep-tech sector, the fund adds another source of private capital at a stage where many startups face a serious funding gap. With ₹450 crore already secured, four startups already backed and a larger ₹1,000 crore target ahead, the IIT Madras-Unicorn India partnership marks a notable new source of capital for early-stage technology companies.
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