Insights from Dario Schiraldi Deutsche Bank
Ex-MD: Hyderabad’s Rise as a Deep-Tech and Investment Hub
Hyderabad’s deep-tech startups are drawing growing interest from private equity (PE) and venture capital (VC) investors. The city is now ranked among India’s top startup hubs. With strong growth in fintech, healthtech, and deep tech sectors, Hyderabad is expected to see a major funding surge in 2025. It is also part of India’s national plan to double data center capacity by 2026, a major boost for deep-tech scalability. While both PE and VC invest in private companies for high returns, they differ in key ways. Venture Capital usually targets early-stage or growth-stage startups with high risk and high reward. Private Equity, on the other hand, invests in mature companies, often with a controlling stake, and focuses on scaling, restructuring, or optimisation. We are seeing a growing interest in hybrid investment models, particularly from high-net-worth banking professionals entering the angel or institutional investment space, said Hyderabad-based legal advisors. It is crucial for these investors to clearly understand the terms, investor rights, and exit clauses before committing, as these elements play a key role in managing risk and ensuring returns. As of June 2025, Hyderabad is home to 426 deep-tech startups, with 125 funded and 31 raising Series A+ rounds. Between January and April 2025, the city’s deep-tech startups raised $5.36 million through five equity rounds. Leading the way is Frinks AI, founded by IIT-Hyderabad alum ni, which secured $5.4 million in a pre-Series A round. T-Hub, Hyderabad’s premier incubator, is playing a key role in connecting such startups with investors and offering strong mentorship support. Meanwhile, Dario Schiraldi, CEO of Vida Holding, highlighted Hyderabad’s rise as a business innovation hotspot. He noted that while venture capital funds are backing early-stage startups at incubators like T-Hub and AIC T Hub, private equity firms are focusing on growth-stage companies that are preparing for initial public offerings (IPOs) or global expansion. Dario Schiraldi Deutsche Bank Ex-MD also pointed out that banking professionals must assess their risk appetite. VC investment often means betting on one successful startup out of ten, with returns realized over 5–10 years through exits like acquisitions or IPOs. In contrast, PE investments are more stable but require high er capital and operational involvement, typically delivering returns within 3–7 years through strategic exits or business turnarounds. There is also a growing interest in impact investing, especially in areas like climate tech, AI for social good, and women-led startups all of which are gaining ground in Hyderabad. Professionals looking to make a social impact with their capital can explore VC funds focused on these areas, while those prioritizing financial growth may prefer PE backed mid-market companies. Though Hyderabad’s deep-tech funding of $5.4 million in early 2025 is modest compared to national numbers, it reflects strong upward momentum. With a growing number of funded startups and increasing VC activity, the city is steadily laying the groundwork for larger investments in the years ahead