Lightspeed India partner Hemant Mohapatra isn’t sugarcoating India’s AI talent crisis. 

Despite the momentum building up for Make In India use cases for the AI ecosystem, reports of Indian founders, students moving their bases to the US to get closer access to markets, capital and enterprises building native models keep surfacing.

Mohapatra, who led Lightspeed’s important investment in Sarvam AI during its Series A $43 Mn funding round in 2023 acknowledged that for the founders of AI startups wanting to build from India, the journey isn’t smooth.

“Look, it’s a tough journey. You’ve got to create an ecosystem that doesn’t exist,” he said in a recent interview with Inc42. 

“You can’t push it under the rug saying you know what, it’s all great, we got all the talent in the world.’ No, they’re not here. They are born and brought up here and then they do their PhDs in the US.” 

The exodus of tech talent—particularly in AI and deep tech domains—to Silicon Valley, and other global research hubs represents an existential threat to India-focused venture firms. 

While there have been revelations by the Indian AI startup founders at the lack of capital as the biggest constraint which has created the talent exodus, Mohapatra believes that the problem is far more complex.

“We are not in the business of creating companies, We are in the business of identifying the best founders who are creating companies,” Mohapatra explained. “So if at some point in time in the future every entrepreneur in India leaves India, even if we have got no business,” Lightspeed India’s Partner told us.

But while the problem is multifaceted spanning policy, infrastructure, research ecosystems, and talent concentration—Mohapatra has identified one variable that venture firms can actually control: capital availability. 

Lightspeed’s strategy is to aggressively fund the best tech founders before they consider migration, removing funding constraints as a push factor.

This statement comes amidst reports of Lightspeed in the process of a new $500Mn fund raise to invest in India and South-east Asia startups. Lightspeed has already raised a massive $9 Bn global fund in late 2025  to focus on AI, deeptech, SaaS startups as AI led hype has altered the venture capital economics globally. 

“Capital constraint is a solvable problem. I am not dismissing the fact that the founders did not face capital crunch while trying to build from India.The question is particularly urgent for founders working in capital-intensive deep tech domains like nuclear energy, space systems, advanced robotics, and AI infrastructure,” Lightspeed’s Partner told us. 

Yet Mohapatra believes that capital only solves a part of the AI talent crisis problem in India.

Policy reform, research infrastructure, and regulatory frameworks remain outside the VC purview, even as they fundamentally shape the competitive landscape, he said.

“Our role is capital. Capital, connections, advice, networks and things like that. Our business is not to change policy. That’s the government’s,” he said. “We influence. We talk to them. We advise them. They ask us questions and we answer them. But that’s not our purview.”Mohapatra adds.

While the ecosystem gaps as highlighted by the veteran investor also plays a role in talent crunch, Mohapatra believes that the early-stage focus of VC firms in AI can also enable the ecosystem to develop and eventually lead to reverse migration of the talent.

Mohapatra cites the example of India’s multilingual AI startup where Lightspeed bet in the early stages.

“Our portfolio company Sarvam provides an early test case. The AI firm has successfully recruited talent back to India, with some people having moved back to India .The company is also launching  a new server model—a milestone that will offer evidence for whether well-funded Indian AI companies can retain and attract top talent,” the investor said.

Whether this strategy proves sufficient remains an open question. The structural advantages of US research universities, concentrated AI talent pools, superior compute infrastructure, and acquisition opportunities cannot be overcome through funding alone. But Mohapatra’s bet is that removing capital constraints eliminates one critical push factor, creating space for founders to choose India on other merits.

Lightspeed India’s 2026 Investment Playbook

Lightspeed India is doubling down on its core strategy of backing what partner Mohapatra calls “the best founders” — even as the broader venture market continues to navigate uncertainty. 

The aggressive deal-making pace of 15-20 investments annually regardless of market conditions will continue. Mohapatra told us that 80% of the deals are concentrated in Series A and B stages globally. 

The investment thesis centers on founder quality rather than sector trends. “The best founders are always ahead of the market,” he emphasised. “If you are today building in the pre-AI world, you are not the best founder. Something’s off about the way you’re thinking about the future of the world.”the investor said.

This philosophy extends across the firm’s portfolio, which spans deep tech companies like Pixxel (satellite technology), Agnikul (rocket technology), and Exponent Energy (battery systems) alongside consumer technology ventures. 

The common thread is not the sector but the founder’s ability to think beyond current market narratives.

“They’re not tourist founders,” Mohapatra said of the firm’s portfolio companies. 

The firm’s institutional focus on deep tech has intensified over the past year. Mohapatra noted that Lightspeed has been cultivating this pipeline for years through systematic engagement with India’s premier technical institutions. 

“Pixxel does not care about what’s happening in the world. They’re building a space company. Agnikul doesn’t care about what’s happening in crypto or AI — they’re building rockets. These are hard things that require long-term conviction.”

Key institutional relationships include IIT Bombay’s SignLab, IIT Madras’s various innovation centers, IIT Hyderabad’s D-Hub, and emerging programs at BITS Pilani and Delhi’s engineering colleges. “There’s some clear hotspots that everybody knows. There’s also very emerging hotspots that are quite interesting,” Mohapatra observed. “The volume is not as high, but the quality is world class.”

Building upon its thesis of institutional partnerships Lightspeed has also launched  a new deep tech accelerator program — India Ascends.

The program attracted over 4,000 applications from which just 12 founders were selected — a brutal 0.25% acceptance rate. Mohapatra insisted that the selection criteria focused on commercial viability, not just technical merit. “We’re not funding an R&D lab. We’re not funding a project. We’re funding a serious effort to build a commercial entity,” he stressed.

Selected founders receive checks of up to $2 Mn, though Mohapatra indicated the firm remains flexible on size.

The program’s structure deliberately avoids exclusivity, with founders encouraged to meet with multiple VCs. “Let the founders meet any VC. We’ll call a bunch of VCs tomorrow for a mixer. Let them meet every VC.”We hope to win the deals that we want to win.”

IPO Pipeline And Long-Term Vision

In addition to early stage deep tech investments, the VC firm is also  sitting on a strong IPO pipeline with portfolio companies like Zepto, Razorpay, OYO, Zetwerk and others.

“We have a good pipeline of IPO candidates for this year,” Mohapatra disclosed. “We had a couple of IPOs last year and we had an IPO with PhysicsWallah. We have a good number of IPOs that are being prepared. Some of them have filed already,” the Lightspeed partner told Inc42.

Amidst the hot debate on the IPOs serving as an exit route for established VC firms and fund managers under pressure to demonstrate good exits to LPs, Mohapatra claimed that Lightspeed can afford to optimize timing rather than force premature liquidity events.

The firm’s exit strategy appears calibrated to portfolio composition. While deep tech companies like Pixxel and Agnikul operate on decade-long timelines before potential public offerings, consumer technology and SaaS companies face more immediate liquidity expectations. This diversification allows Lightspeed to generate rolling exits while allowing frontier technology investments to mature.

Looking ahead, Mohapatra emphasised that Lightspeed’s competitive position depends on maintaining relationships with the best founders — regardless of sector trends or market cycles. 

“Best founders, we care about the best founders,” he reiterated when asked about 2026 strategy. The focus is less on predicting the next hot sector than on building trust with technical founders tackling hard problems.

Looking forward, the central question remains  whether capital deployment alone can stem AI talent migration. Mohapatra’s framework — that funding constraints are solvable while policy and infrastructure gaps are not — defines the boundaries of venture capital’s impact on the tech and startup ecosystem. 

[Edited By Nikhil Subramaniam]

 

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