ARTPARK, a not-for-profit foundation, will invest in 10-15 early and growth-stage AI and robotics startups over a period of three years from the VC fund
ARTPARK is also looking at supporting nearly 52 AI and robotics startups in India in the next five years
The foundation, backed by the Department of Science & Technology, has so far backed 19 startups in the AI and robotics space
Bengaluru-based AI and robotics foundation ARTPARK has launched a $100 Mn venture fund to invest in 10-15 early and growth-stage AI and robotics startups building products for education, mobility and healthcare sectors over a period of three years.
The fund has received approval from the Securities and Exchange Board of India (SEBI) and will make its first closure by December this year. It will invest in new as well as existing portfolio startups.
“Having been entrepreneurs and built technologies by ourselves, we understand this phase where entrepreneurs need financial backing. Through this fund, we are offering startups the required risk capital,” ARTPARK cofounder Umakant Soni said.
The AI & Robotics Technology Park (ARTPARK), a not-for-profit foundation founded in 2020, is a brainchild of Indian Institute of Science, Bengaluru and venture studio AI Foundry to promote technology innovations in the sectors. ARTPARK has received a $32 Mn seed grant from the Department of Science & Technology (DST) and the Karnataka government.
Apart from launching a VC fund, ARTPARK is also looking to support nearly 52 AI and robotics startups in India in the next five years.
“We aim that a couple of our funded startups not only gain the unicorn status but also turn into decacorns and hold the potential of becoming a transformative engine of change that can reshape the entire business ecosystem,” Soni said.
ARTPARK aims to promote AI and robotic startups doing innovations in diverse sectors such as agriculture, healthcare, education, mobility, infrastructure, agriculture, retail and cybersecurity. So far, it has invested INR 75 Lakh each in 19 startups in the AI and robotics space. It also runs an incubation program for startups.
Challenges Faced By AI & Robotics Startups
Citing a PwC report, Soni said that the artificial intelligence (AI) and robotics market is going to create about $15.7 Tn of economic value by 2030. Despite having a promising future, the AI and robotics startups face a lot of challenges, he said.
One of the biggest challenges for entrepreneurs leading AI startups is finding the right talent. Unless the cofounder or CTO understands AI and can align with research and build a technical output, it is very difficult to get the talent, Soni said.
Explaining further, he said that robotics startups require professionals well-versed with AI and mechanical engineering. However, the shift of these high-demand professionals toward tech giants such as Google, Facebook, and Flipkart is creating a gap for AI and robotics startups.
Besides being the cofounder of ARTPARK, Soni is also a cofounder of AI-focussed foundation AI foundry and venture capital firm pi Ventures. He is also a technology advisor to NITI Aayog and the DST in areas related to AI. Recently, he was selected as a member of the 6G task force set up by the Ministry of Communications.
Soni also said that getting investment from venture capitalists is another problem for AI and robotic startups. “VCs always try to second guess AI and robotic entrepreneurs and ask them to come when they start generating revenue. By the time entrepreneurs start making revenue, they practically die…getting investment in the robotics sector is way difficult as entrepreneurs have to build robots that cost huge,” he said.
According to a report, India’s AI market was estimated to be worth $3.1 Bn in 2020. The industry is likely to grow into a $7.8 Bn market by 2025, growing at a CAGR of 20.2% by 2025.
Sudip Nandy-backed Navikenz, Prosus Ventures-backed Detect Technologies and MassMutual Ventures-backed Qure.ai are among the startups in the space.
