Arise Ventures, an early-stage venture capital (VC) firm, has sharpened its focus on companies where artificial intelligence (AI) is not an add-on but integral to the product and business model. Founded in 2021, the firm has invested in more than 50 startups across three funds. It is currently deploying capital from its Rs 500-crore Fund III. The firm has so far invested 30–40% of the corpus, Ankita Vashishta, founder and managing partner of Arise Ventures, tells S Shanthi in an interview. Excerpts:
How have valuation expectations and deal terms evolved in 2025, and what discipline are you applying in 2026?
Valuations have become far more rational and grounded in fundamentals. In 2026, we are applying strict discipline around revenue quality, margins, capital efficiency and realistic growth projections rather than speculative multiples. We are focused on durability over hype.
Which themes are crowded today, and where are you deliberately cautious despite the hype?
Generic fintech apps and undifferentiated consumer D2C brands appear crowded. We are also cautious about edtech and generic horizontal marketplaces. Instead, we prefer deeptech and AI-driven businesses with clear enterprise or sector-specific use cases, where technology meaningfully transforms outcomes rather than simply riding hype cycles.
What are the sectors you are bullish on at present?
We are strongly bullish on AI-first businesses across enterprise SaaS, healthcare, consumer tech and next-generation consumer brands. Our focus is on companies where AI is not an add-on but core to the product and business model, driving measurable efficiency, outcomes and defensibility. In enterprise, this includes AI-led SaaS and infrastructure solving real operational pain points. In healthcare, we back technology that improves access, outcomes and system-level efficiency. In consumer, we are excited about brands that combine strong product differentiation with data, technology and disciplined unit economics.
How many investments will you be clocking by the end of FY26 and how many do you plan to make in FY27?
We are a very hands-on, go-to-market-focused fund, investing from post-revenue seed to Series A. On average, we make two new investments every quarter while also actively supporting our existing portfolio with strategic and commercial acceleration. Our typical first cheque ranges between 2.5 crore and15 crore, depending on stage and opportunity, with significant follow-on capital reserved for high-conviction portfolio companies.
What are the three key things you look at before investing?
Founder–market fit, including clarity of vision, depth of insight, execution capability and resilience; clear differentiation and global scalability of the business model; and AI-first or core technology leverage that meaningfully transforms the sector, rather than merely enabling incremental tech adoption.
As someone watching the startup investment space closely, what are some favourable investment trends?
Two trends stand out clearly. One is the rise of AI-native companies solving meaningful problems for India and the emerging middle class across healthcare, agritech, logistics, drones and enterprise productivity. Another is Indian startups building with global ambition much earlier, leading to the emergence of world-class brands and enterprise companies from India to the world.
What are some of the challenges faced by VCs and PEs today?
Key challenges include limited exit liquidity, especially at later stages, and the need for more institutional capital backing early-stage funds and founders to sustain long-term innovation cycles.
Many startups seem to be focusing on the path to profitability today. Your thoughts?
This is a very healthy and necessary correction. Founders today are far more focused on building real businesses rather than narratives, which ultimately creates a stronger, more resilient startup ecosystem.
Do you think we will see many more startups getting listed in public markets next year, and why?
We will see more listings, but only from companies with strong fundamentals. Public markets are no longer rewarding growth without profitability, and that discipline is a positive shift for the ecosystem.
Beyond IPOs, what are the most realistic exit pathways in 2026–27, and what needs to change for more liquidity?
Strategic acquisitions and secondary sales are likely to dominate exit activity. To unlock greater liquidity, India needs a more active merger and acquisition (M&A) ecosystem, institutionalised secondary markets, and stronger participation from global strategic acquirers. Liquidity improves when capital recycling becomes predictable.
