Accel and Prosus Forge Strategic Partnership to Support Early-Stage Indian Startups
New Investment Initiative Targets Founders Addressing Systemic Challenges in India
In a significant development for the Indian startup ecosystem, renowned investors Accel and Prosus have announced a collaborative investment partnership aimed at nurturing Indian startups right from their inception. This initiative, unveiled on Monday, marks Prosus’s inaugural foray into early-stage investments.
Early-stage Investment for Systemic Change
The partnership signifies a commitment from both firms to co-invest in startups during their formative phases, concentrating on ventures that aim to tackle pressing systemic issues across various sectors such as automation, energy transition, internet services, and manufacturing.
India’s digital economy is rapidly expanding, supported by over 1.4 billion residents and a robust user base of more than a billion internet users, alongside over 700 million smartphone users. As the second-largest smartphone market globally, India benefits from a digital infrastructure established by government initiatives like the Unified Payments Interface (UPI) and Aadhaar. However, the prevailing trend in Indian startup efforts has largely revolved around replicating global business models, often neglecting the opportunity to address significant domestic challenges. The Accel-Prosus partnership aims to shift this narrative.
Enhancing the Early-Stage Founder Program: Atoms X
This collaboration enhances Accel’s Atoms X early-stage founder program, which was initiated in July to support what the firm refers to as "leap tech" startups—companies focused on solving large-scale, systems-driven issues.
"As the Indian startup ecosystem evolves, it is vital for entrepreneurs to shift from merely adapting global businesses to innovating unique models that can propel India towards becoming a developed nation," remarked Pratik Agarwal, a partner at Accel.
Agarwal noted that many startups targeting population-scale solutions often grapple with securing early funding due to protracted development timelines and the risks of equity dilution. “Our goal is to provide timely capital that enables startups to progress significantly without facing multiple setbacks before achieving meaningful milestones,” he explained.
Financial Commitment and Co-investment Strategy
Under this partnership, Prosus has pledged to match Accel’s investments in nascent companies, with initial funding ranging between $100,000 and $1 million, potentially increasing as these companies grow.
"We have the option to continue operating independently within this sector; however, given the ambitious goals of these founders and the complexity of the challenges they face, collaborating makes strategic sense," stated Ashutosh Sharma, head of the India ecosystem at Prosus.
Traditionally, Prosus has concentrated on late-stage investments worldwide, with prominent stakes in companies such as Swiggy, Meesho, and PayU in India.
Sharma clarified that while Prosus aims to match Accel in investment, it does not prioritize acquiring an equivalent equity stake in the startups at this stage. "Our primary objective is to identify and support the future giants of the industry without fixating on immediate equity distribution," he added.
Broadening Investment Focus in India
The partnership also widens the investment horizons for both Accel and Prosus in India. Their recent co-investments have included startups like Arivihan, an AI-based tutoring platform, and Wiom, a low-cost internet service provider.
Sharma commented on the broader implications of technological advancements, particularly in artificial intelligence: "Countries that can adeptly navigate this AI-driven disruption are likely to benefit significantly. We aim to ensure that India carves out its own space in this rapidly evolving landscape."
Addressing Geopolitical Challenges in Investment
As global political tensions reshape capital flows and market dynamics, investors are increasingly reassessing safe and scalable investment opportunities. India’s large domestic market, burgeoning digital infrastructure, and growing pool of technical expertise position it as a strategic priority for international investors.
"India’s role in the global economy necessitates a rapid and self-sustaining path toward becoming an independent, developed nation," stated Agarwal.
Accel has previously backed over 40 startups through its Atoms early-stage program, with more than 30% securing follow-on investments from other funders, including Accel leading many of these rounds.
Despite a recent decline in venture capital funding—down 25% year-over-year to $4.8 billion in the first half of 2025, with late-stage investments decreasing by 27%—India remains an attractive destination for global venture capitalists, due to its size and digital growth potential.
In a notable collaborative effort, eight US and Indian venture capital and private equity firms, including Accel, Blume Ventures, and Premji Invest, formed a coalition in September to invest over $1 billion into deep tech startups. The Accel-Prosus partnership signifies a continued commitment by global VCs to invest in India’s promising future.
