Accel and Prosus collaborate to support early-stage Indian startups

Renowned investors Accel and Prosus have launched a new investment partnership to back Indian startups from day one, targeting founders who are building large-scale solutions with the potential to serve audiences in the South Asian country.

The collaboration was announced on Monday and marks the first time Prosus has invested in the formation stage. The two companies will co-invest from the startup’s early days, focusing on companies that address systemic challenges across sectors such as automation, energy transition, internet services and manufacturing.

India, the world’s most populous country with more than 1.4 billion people, is witnessing rapid growth in its digital economy. The country has more than 1 billion Internet users and more than 700 million smartphone users, making it the second largest smartphone market after China. Indian government-backed platforms such as Unified Payments Interface (UPI) and Aadhaar have created a digital infrastructure that enables startups to quickly build and scale services. However, much of startup activity in India to date has been focused on adapting global business models, with fewer companies addressing large-scale local challenges. The Accel-Prosus alliance is looking to change that.

The partnership expands Accel’s early-stage founders program, Atoms

“We feel now is the right time for the Indian startup ecosystem to move from adapting global companies to creating Indian models that will help India leapfrog its journey to become a developed nation,” Pratik Agarwal, partner at Accel, said in an interview.

He added that startups working on population-level solutions often struggle to raise enough early capital, given long incubation periods and the risk of severe dilution before reaching meaningful traction.

“We hope to bring them a lot of early capital at the right time so they can make significant progress without going through several rounds of false starts before they make progress,” he told TechCrunch.

Under the partnership, Prosus has committed to matching Accel’s investments in each company, with initial checks ranging from $100,000 to $1 million – a number that could increase over time.

“We can continue to do our own things in this space, but given the scale of ambition these founders have, and given how difficult the problem they are trying to solve, it made sense for us to pool our resources together,” said Ashutosh Sharma, head of India ecosystem at Prosus.

Traditionally, Prosos has focused on late-stage investments globally. The Amsterdam-headquartered company counts Swiggy, Meesho and PayU among its major investments in India.

While Prosus has committed to matching Accel’s investment in this partnership, Sharma noted that it is not seeking a matching equity stake.

“For us, getting these shares in the first round is not important at all,” he told TechCrunch. “If we can truly define the Swiggy, Meesho, iFood or Tencent of tomorrow – today – that is success enough.”

The partnership also expands Accel and Prosus’ footprint in India. In recent months, the two companies have jointly invested in startups such as AI-powered teaching platform Arivihan and low-cost internet service provider Wiom.

“Because of this AI-led disruption happening around us, some countries will be disproportionately net beneficiaries of this — and some countries will be disproportionately net losers,” Sharma said. “Two countries that seem very well placed to be beneficiaries are the US and China. Now in this global order, in this global narrative, what is the Indian space? And so, can India, as part of the ‘leapfrog’ revolution, find the right place, not just in AI, but outside of AI, is the other ambition, let’s say, that we have with this programme.”

The alliance comes amid rising geopolitical tensions that have disrupted capital flows, technology supply chains, and market access – prompting global investors to reevaluate where capital can be deployed safely and at scale. With a large domestic market, an expanding digital infrastructure, and a growing tech talent pool, India is increasingly seen as a strategic priority in this landscape.

“India’s position in the global economy and geopolitical order is such that India needs to chart and accelerate its course as a self-sovereign and independent developed nation,” Agarwal told TechCrunch.

Accel has already supported more than 40 startups through its early-stage program Atoms. More than 30% of them went on to raise subsequent funding from external investors, with Accel itself leading more than half of these rounds.

Venture capital funding in India fell 25% year-on-year to $4.8 billion in the first half of 2025, according to Tracxn, with late-stage deals down 27% to $2.7 billion, and early-stage funding down 16% to $1.6 billion.

However, India remains a major hub for global investors, driven by its large population and expanding digital adoption. In September, eight US and Indian venture capital and private equity firms — including Accel, Blume Ventures, Celesta Capital and Premji Invest — formed an alliance to back deep tech startups with a commitment of more than $1 billion. The Accel-Prosus partnership is the latest example of how global venture capital firms continue to place long-term bets on India.