Summary Points
- Trump’s aggressive tariff policies have disrupted global investor confidence.
- Venture capitalists are delaying investments and re-evaluating exit strategies.
- Indian LPs and VCs are adopting a “wait and watch” approach.
- The tariff war may hit global supply chains, similar to the Covid-era chip shortage.
- Indian deeptech and defence sectors could benefit as Western capital reroutes.
- Unacademy eyes profitability; BRND.ME raises debt as startups focus on stability.
Donald Trump’s renewed tariff war has sent shockwaves through global markets. Though the US has issued a temporary 90-day relaxation, the uncertainty is already affecting investor behavior across continents. And at the quiet edge of this economic quake lies India’s startup ecosystem—watching, waiting, and worrying.
Investors Are Freezing Capital—Again
For many venture capital firms, Trump’s erratic tariff moves feel like déjà vu.
- Foreign LPs are delaying capital deployment, fearing long-term market instability.
- Indian VCs are reassessing startup valuations, funding timelines, and exit windows.
- Many are comparing the potential damage to that of Covid-era disruptions, particularly the chip shortage crisis of 2020–21.
Case in point:
A mid-stage healthtech fund postponed its Rs 150 crore deployment plan after its US-based LP flagged concerns about supply chain volatility linked to potential trade restrictions.
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India Plays the Waiting Game
So far, Indian investors are taking a cautious stance.
- With no immediate policy fallout in India, VCs are not making big moves.
- However, they are urging founders to conserve cash, focus on sustainable unit economics, and pause aggressive expansion for now.
One VC from Bengaluru described the mood as “holding breath till Q3.”
VCs Reassess Exit Strategy
Trump’s tariff moves have triggered a wave of uncertainty over foreign IPOs and M&A activity.
- Many US-based acquirers are expected to pull back on international startup acquisitions.
- Exit timelines may stretch by 12–18 months for some portfolio companies.
- This forces Indian VCs to revalue their stakes and adjust fund lifecycle expectations.
Opportunity Hidden in Chaos: A Boost for Deeptech & Defence
Amid the gloom, some sectors may thrive.
- With US capital likely to avoid China, Indian deeptech startups in defence, spacetech, and semiconductors are in a strong position.
- Make in India policy incentives are adding fuel to this potential redirection of global funds.
Example:
An Indian defence-tech startup backed by a US VC saw a 2x surge in follow-up interest post-announcement of the tariff hikes, as the VC sought “China-alternative” supply chains.
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Quick Updates From the Ecosystem
Unacademy Aims for Profit in 2025
CEO Gaurav Munjal shared that 70% of offline centres are on track to turn profitable, aiming to reduce cash burn to under Rs 200 crore this year.
HouseEazy Eyes Rs 100 Crore Round
The proptech startup is in talks to raise approx. Rs 100 crore (USD 11.7 million) from a major VC fund and Chiratae Ventures.
BRND.ME Secures Rs 48 Crore Debt
Tiger Global-backed startup raises funds from Stride Ventures. The brand is also in the process of moving its base to India, joining the reverse-flipping trend.
PhonePe’s Pincode Delivers Medicines in 10 Minutes
The fintech’s quick-commerce platform now offers rapid pharma deliveries in Bengaluru, Pune, and Mumbai.
Zomato Cleared in Anti-Competition Case
CCI ruled that Zomato’s platform and delivery charges are not unfair, bringing relief to the foodtech major.
Google Pays Rs 20.24 Cr to Settle Smart TV Case
Google agreed to provide a standalone Play Store license for Android smart TVs in India as part of the antitrust resolution.
KRAFTON Incubates 6 New Gaming Studios
The South Korean gaming giant selected 6 Indian gaming studios for its second cohort, offering USD 150K (Rs 1.25 crore) in grants.
India Mulls 10% Cap on Chinese JV Stakes
The government is planning to cap Chinese ownership in electronics JVs to 10%, pushing for local tech manufacturing.
