Aum Ventures closes first tranche of $80 million India Innovation Fund II
The Abu Dhabi-based VC targets deeptech and IP-led startups with a focus on AI, semiconductors, and defense.
Abu Dhabi-headquartered venture capital firm Aum Ventures has announced the first close of its second investment vehicle, the India Innovation Fund II. The move signals a strategic expansion of the firm's commitment to India's high-growth deeptech ecosystem.
The fund has a target corpus of ₹750 crore, approximately $80 million, and is structured as a SEBI-registered Category II Alternative Investment Fund (AIF). Led by Founding Partner Chetan Mehta, the vehicle will deploy initial cheque sizes ranging from $750,000 to $2 million. Aum Ventures has also allocated specific reserves to support portfolio companies through Series A and B follow-on rounds, with a goal of backing 25 to 30 companies over the fund's lifecycle. To support this growth, the firm has appointed Nisha Shah as a General Partner.
Strategic Focus on Deeptech
The India Innovation Fund II is specifically designed to target IP-led and innovation-driven startups. The investment focus centers on high-barrier sectors including artificial intelligence, custom semiconductors, advanced manufacturing, aerospace, and defense technology. This specialization reflects a shift toward hardware and complex software solutions that require significant technical validation before reaching commercial scale.
Bridging the Scalability Gap
This launch follows the deployment of Aum Ventures' debut fund, which was formed in 2022 and invested $30 million across 24 startups. That initial portfolio included notable names such as Skyroot Aerospace, Azimuth AI, and Sharang Shakti. By focusing on deeptech, the firm aims to bridge the gap between India's domestic intellectual capital and global scalability. The fund intends to provide not only early-stage capital but also the cross-border advisory networks necessary for Indian startups to compete in international markets.
Market Implications
The emphasis on semiconductors and defense tech aligns with broader national initiatives in India to reduce import dependency and foster a domestic manufacturing base. By providing early-stage validation for these capital-intensive sectors, Aum Ventures is positioning itself as a critical link in the supply chain of Indian innovation, moving beyond the consumer-internet models that dominated previous VC cycles.
Future Outlook
As the fund moves toward its full target corpus, the industry will be watching for the first batch of investments from Fund II to see which specific sub-sectors of AI and aerospace gain the most traction. While the target portfolio size is set, the speed of deployment will depend on the availability of venture-ready IP in the current macroeconomic environment.