Venkat Vallabhaneni

What I look for in SET founders. At Inflexor we call our focus SET: Science, Engineering and Tech. Some call it deep tech, but that word means different things to different people. A short thread on what matters to me.

Private industry's share of India's R&D spending went from about 32% to 45% in three years, according to the government's latest R&D statistics. For deep tech founders, that changes who sits across the table. More of your customers now have R&D teams of their own, which is good news: someone inside who can actually evaluate your technology and champion it. It also raises a question I'd want answered early. If your biggest customer's lab decided to build this themselves, how long would it take them, and what would they still need from you? Founders, is your customer's R&D team your best champion or your future competitor?

A big corporate investor in your early round can open doors. It can also quietly close them. In Indian deep tech, a strategic cheque often comes with a pilot, a known logo and a lot of credibility. I like all of that. What I look at is the fine print: rights of first refusal, exclusivity, information rights, and whether that investor's competitors will still buy from you once it's on your cap table. Your first strategic investor can become your best customer or your only possible buyer. Know which one you're signing up for. Founders, did a strategic investor make your next round easier or harder?

If your only edge is that you're cheaper because you're in India, you don't have a deep tech company yet. I see this a lot. Founders price well under a US or European competitor and call that the strategy. Labour and facility costs help, but they aren't a moat. A well-funded rival can open a centre in Bengaluru too. What lasts is the hard part: process know-how, IP a buyer actually pays for, and a customer who would still choose you at a similar price. Founders, if you stripped out the India cost gap tomorrow, would a customer still pick you?

In Indian deep tech, the word "pilot" has become a soft landing for a no. A free or heavily discounted trial, a polite report, then nothing. The founder counts traction. The buyer got free R&D. I ask for three things before I treat a pilot as real: a named sponsor inside the customer, a success metric written down before day one, and what happens to the purchase order if you hit it. Without those, you're funding their learning curve. Founders, how many of your last five pilots actually turned into paid orders?

How I'm rebuilding VC work around AI, part 3: the cheque isn't the end of the work. Most founders hear from their investors when a board meeting is due or a new round is coming. That's not good enough. I'm having agents keep watch, for each company we back, on what actually moves its business: new research and patents in the field, policy and procurement shifts, a likely customer starting to buy. My job is to judge what matters, then bring it to the founder before they have to ask. For founders, every conversation with me should open with something useful, not "how's it going?" For LPs, every company gets the same steady attention, not just the loudest ones. Founders, what's one thing you wish your investors kept track of for you?

When a new policy opens a market in India, I usually see a dozen similar decks within weeks. Same TAM. Same subsidy. Same claim that timing is everything. What I look for instead is the part the policy doesn't hand you: a technical edge a competitor can't copy just by reading the gazette, and a customer who would still buy if the incentive disappeared tomorrow. Policy can open a window. It can't build a company. Founders, have you ever walked away from a hot policy theme because your edge wasn't real enough?

Many Indian deep tech founders price like they're still competing on cost. I think it's one of the most expensive habits to carry into a global market. If your product does something genuinely new, the customer isn't comparing you to a cheaper version of the old thing. They're comparing you to the problem you remove: the downtime, the scrapped batch, the failed test, the months of delay. Price against that problem, and your margins can fund the company instead of your next round having to. Founders, how did you set the price for your first paying customer?

A government order can be a great first customer for deep tech in India. It can also quietly sink you. Long procurement cycles, trials that stretch for a year, and payments that arrive months after delivery all land on your working capital, not your pitch deck. So when a founder's plan rests on government demand, I ask three things. How long from first trial to purchase order? When does the cash actually arrive? And what pays the bills while you wait? Founders selling to government in India, what was your longest wait between delivery and payment?

Almost every quantum pitch I see has a slide about what becomes possible once the machines are big enough. I'm more interested in the slide before it. Useful, fault-tolerant quantum computers may still be some years away. The companies I'd back are the ones finding someone willing to pay before then: sensing, secure communication, control hardware, software that helps today's machines do more. If the business only works once the science fully arrives, you're asking investors to fund the wait. If it earns along the way, you're building a company. Quantum founders, who is your paying customer before fault tolerance arrives?