By any benchmark, Accel is among the leading venture capital firms in India. With nearly two dozen Indian unicorn startups, including several top tiers, Accel’s track record speaks for itself. But the partners leading the company’s early-stage accelerator program, called Atoms, are uncharacteristically introverted about their insights and the changes they’re implementing to improve their chances of success.
“A fundamental belief we have is that at some point, all VC firms look the same to a founder. It’s just money,” Accel partner Prayank Swaroop said in an interview.
All VC firms have also grown increasingly focused on making early stage investments in India in recent years and finding the next startup Flipkart. The shift is largely driven by the realization that India is not generating multi-billion dollar exits, making it imperative for VC funds to get in earlier to dramatically improve their returns.
An accelerator program run by a fund that invests in startups at various stages faces unique challenges. If the company fails to significantly back its accelerator portfolio in subsequent funding rounds, it could send a negative message to the industry. In addition, experienced entrepreneurs may not find an accelerator to be the most suitable partnership option for their businesses.
These are some of the challenges Accel has been thinking about for nearly half a decade. Before launching Atoms, the venture capital firm explored building a knowledge repository and community with SeedtoScale, an earlier program launched by Accel.
“We did Demo Days, we were trying to be a lot like a lot of other funds,” Swaroop told TechCrunch.
Just as fast as Accel has been trying things out, it’s also taken a few steps back. It no longer attempts to start mixing between Atoms portfolio startups and other investors, for example. Swaroop recalled a conversation with a founder who informed him how the investor meeting felt like the startup was put on a runway to artificially impress other potential backers.
Other candid comments from founders revealed that many were uncomfortable dealing with industry peers who were years ahead of them.
“We’re trying to find our own unique path, and what worked for some of the other companies, we don’t think works for us,” he said.
So here’s what that path looks like. Atom’s third cohort includes just eight startups, which is significantly fewer than other well-known accelerators. And all the selected startups work in two areas: AI and Industry 5.0 (smart manufacturing.)
Accel invests up to $500,000 in each selected seed round and there is no valuation cap. In addition to helping the startup with strategy, Accel also helps them meet industry players who can become potential partners and customers in the future.
Accel chose AI and Industry 5.0 as topics for Atoms because the firm believes the two areas will loom large over the next 10 years, said Barath Subramanian, the other partner who leads Atoms.
AI has obvious appeal. Meanwhile, Subramanian said Industry 5.0 has emerged as a key theme as archaic factories in India and elsewhere finally modernize, paving the way for efficiency-driven startups to take a slice of the tens of billions of dollars flowing into consulting firms and others every year. “These factories generate a lot of data, but until now it was untapped,” Subramanian said.
The smart manufacturing sector has also benefited from New Delhi’s incentives to attract foreign companies to expand their manufacturing bases in the country and also from the growing ‘China + 1’ shift among global giants.
More than 800 startups applied to participate in Atoms 3.0, and between 300 and 400 applicants were AI startups. Swaroop said nearly two-thirds of all presentations focused on AI startups that sought to solve HR and marketing problems. “If there’s a lot of noise in the market, it’s a signal to us that we need to hunt elsewhere,” he said.
Pallavi Chakravorty, co-founder and CEO of Meritic, said in a statement to TechCrunch that the choice by Atoms was significant. “Beyond the capital and learning sessions, being part of Atoms has given us a strong community of founders and a highly collaborative peer group. For example,” continued Chakravorty, “when Meritic faces a challenge, we can turn to any other team at Accel LaunchPad, where we’re currently active, or any of Accel’s network of over 200 founders of portfolio companies, for to reach a solution.”
Below is the third cohort of Individuals:
Sparkling
Spintly is an IoT platform that simplifies access control in commercial and residential buildings. Unlike traditional systems, Spintly uses a distributed IoT architecture and state-of-the-art computing technology, which eliminates the need for heavy back-end infrastructure and enables smartphone door access to users. Spintly has eliminated 200,000 plastic signs and 2,000 miles of wired infrastructure from the built world and currently serves 300+ customers and 4k+ doors.Assets
Canada-based Assets has launched a comprehensive cloud-based, AI-powered design suite, a multi-disciplinary CAD design, simulation and engineering platform that helps Engineering Procurement Construction (EPC) and end-owner companies accelerate their first steps. -stage engineering by 10x. Customers benefit from rapid deployment of engineering resources, reducing effort time and costs associated with engineering projects.Tune AI
Tune AI is an enterprise GenAI stack with solutions that include Tune Chat, an AI chat app with over 180,000 users and powerful models for text, code generation, and brainstorming, and Tune Studio, an end-to-end solution for refinement, development, and managing the Gen AI model lifecycle and enabling data security with enterprise-grade compliance.Skoob
Skoob is a productive AI platform revolutionizing the way readers interact with books. Instead of browsing through entire volumes, we harness the power of artificial intelligence to dissect books into thematic sections. We make knowledge consumption intuitive and user-friendly.Arivihan
Arivihan is India’s 1st 100% Automated Learning Platform based on Artificial Intelligence which provides every unique student a personal tutor in their pocket for ₹300 per month, guiding them in exam planning, teaching them with video lectures, talking together them, solving their questions instantly and validating their knowledge by testing and improving it whenever they want, at the speed they require.Honorable
Meritic is a storytelling co-pilot for financial planning and analysis (FP&A) teams to automate reporting and business analytics. Meritic combines the power of knowledge graphs and language models to perform high-content analysis, collect qualitative information, generate relevant feedback, and automate the creation of financial decks.(Two startups in the cohort remain under wraps for now.)
