Aum Ventures has announced the launch of its second investment vehicle, India Innovation Fund II, with a corpus of $80 million (approximately ₹750 crore). This is set up to make investments into startups in fast-growing areas of technology, such as space technology, semiconductors, artificial intelligence (AI), and defence technology. It is the second such fund and signifies the full commitment of the company towards developing India’s growing deep-tech environment.
Core sectors and operational timeline
The initiative will support Indian founders who are working to create transformative and innovation-led businesses with strong intellectual property components that hold the potential to thrive on international platforms. This strategic deployment represents a substantial increase in the VC firm’s active investment footprint.
The new fund is a Category II Alternative Investment Fund registered with the Securities and Exchange Board of India. As mentioned by the senior leadership team, the VC firm will use the fund corpus over a 5-year investment horizon. During these five years specifically, the company anticipates investing in no more than 25 to 30 innovative early-stage companies.
The financial firm anticipated that the formal first close of India Innovation Fund II would take place in July 2026, initiating the operating timeline. The disciplined, long-term executive deployment ensures that the portfolio companies are backed by the institutions continuously in their early stages of growth.
India Innovation Fund II has a specific intention to create investment opportunities in high-growth frontier industries where new technology and proprietary resources are the core of the business model. The investment concept will focus mainly on supporting startups in the early stages of development across key areas of space technology, semiconductors, AI, and other high-tech sectors.
The VC firm will focus on institutional venture capital investment in pre-seed and seed-stage startups for such capital-intensive domains. Initial payments from the fund will be between $750,000 and $2 million per startup. In addition to an initial capital injection, the investment company will also facilitate follow-on capital to support the scaling up of these businesses to Series A and Series B stages.
Diverse portfolio and leadership
India Innovation Fund II is being launched on the back of a proven track record garnered by the investment firm since the inception of the fund. Aum Ventures was formed in 2022.
Aum Ventures has already invested around $30 million into 24 different early-stage firms in a wide array of sectors. The firm has established itself as a unique brand in the market by investing in emerging companies in deep tech, like Skyroot Aerospace, Cosmoserve Space, and Sanyark Space, notable new companies that have taken the aviation industry with them to the space industry.
The firm has been at the forefront of the domestic hardware ecosystem by becoming one of the initial investors in a newly formed semiconductor startup, Azimuth AI, which is developing a custom system on a chip. The firm is also supporting the fictional technology company Sharang Shakti, a defence-tech startup powered by artificial intelligence, thus supporting complex engineering solutions.
Aum Ventures structurally strengthened its upper leadership team to deal with the increased operational scale and tough demands of India Innovation Fund II. Investment firm officially hires Nisha Shah as General Partner to second fund. Shah has a deep entrepreneurial background in financial and advisory services, as he served as a senior leader at a large family office.
She has also spent time with various other VC and PE firms, as well as professional consulting companies. The strategic investment will provide the fund with essential institutional experience in assessing difficult deeptech assets and shepherding early-stage founders toward commercialization.
The India Innovation Fund II’s underlying thesis depends on a specific convergence of structural macroeconomic patterns in India. Chetan Mehta, the founding partner of Aum Ventures, said that the local market has reached an extremely unique moment. It is marked by a wave of proactive government policy support, a plethora of top-tier technical talent and increasing capital availability.
The leadership team firmly believes that these shifting conditions are combining to create completely unprecedented opportunities for deeptech development and structural innovation in the region. The fund is intended to create a structured financing option to fill the gap between technical proof-of-concept and international commercial execution.
Conclusion
The launch of the $80 million India Innovation Fund II by Aum Ventures is a much-anticipated step in India’s technology entrepreneurship landscape, given the country’s current focus on making technology systems self-reliant in sectors such as semiconductors, space technology and artificial intelligence. The firm plans to invest ₹750 crore over five years and operate with 25 to 30 projects following IP-based entrepreneurship, tackling a critical funding gap in capital-intensive, early-stage deeptech startups.
Led by the recently appointed General Partner Nisha Shah and with a notable history of investing in promising startups such as Skyroot Aerospace and Azimuth AI, the Category II Alternative Investment Fund is poised to sponsor the next generation of globally competitive technology startups in India.
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