The Partner Exodus, Ather Flags Price Headwinds, and Paytm’s Penalty

The departure of three heavyweight partners from Peak XV is not a personnel update. It is a structural break in Indian venture capital. Ashish Agrawal, Ishaan Mittal, and Tejeshwi Sharma leaving to launch their own fund marks the moment India’s VC ecosystem begins to fragment - moving away from the mega-fund era toward a landscape of founder-first micro-funds.

For a decade, large global platforms dominated Indian venture capital. Their advantage was simple: speed and size. They could write big cheques, back multiple winners, and absorb losses through portfolio math. That model worked when the ecosystem was shallow and capital was scarce. Today, it is colliding with a different reality. India has hundreds of seed-stage startups worth backing and hundreds of investors chasing them. What founders need is not scale of capital, but quality of conviction.

The new micro-fund thesis is built on expertise. Founders backed by these departing partners will get something rare: Series-C-level judgment at the seed stage. These investors have navigated IPOs, regulatory crises, and growth failures. They understand how governance breaks and where unit economics lie. For early-stage companies, this depth matters more than brand. Speed also improves. A decision that takes weeks at a mega-fund can close in days days at a boutique firm. In volatile markets, velocity is leverage.

But fragmentation has costs. Micro-funds lack capital depth. They cannot always lead Series A or B rounds. When a young startup outgrows its first backer, it faces signaling risk: if the original investor cannot follow on, others assume something is wrong. Mega-funds also act as shock absorbers in downturns. A small fund cannot rescue a company when revenues stall or markets freeze.

This pattern is not new. India saw it in 2014-15 when senior investors spun out of Matrix and Helion. It happens when markets mature enough that personal reputation matters more than institutional logo. Peak XV itself is the product of this cycle - once Sequoia India, once WestBridge, now independent. The latest exits complete the loop: from global brand to domestic firm to individual franchises.

The near-term effect will be a talent war inside venture firms. Associates and VPs will follow partners, not platforms. The long-term shift is deeper: by 2028, lead investors in India will be Indian-domiciled funds, not foreign branches. Capital itself is “reverse-flipping.” Family offices and HNIs now fund domestic AIFs more easily, thanks to tax reforms that treat fund holdings as capital assets instead of business income.

There is also a strategic divergence. Mega-funds need large cheques to justify returns. Deep-tech, AI, and hardware rarely need that at seed stage. Micro-funds can make those bets work. A ₹10 crore exit can be meaningful for a small fund and meaningless for a $5B platform. This explains why departing partners want precision funding, not mass deployment.

This is not a crisis for Peak XV. It is the market doing what markets do - unbundling power when scale stops being an advantage. Indian venture capital is not breaking. It is growing up.

Let’s go through what else is happening in Indian startup world - Grab your simmering cup of StartupChai.in and unwind with our hand-brewed memes.

“Savdhani Hati, Durghatna Ghati “: Ather Energy Flags Commodity Volatility Risks After A Strong Q3 Performance

Ather Energy has warned of near-term headwinds from volatile commodity markets despite a strong Q3 performance. The EV maker said fluctuating prices of silver, copper, aluminium, and electronic components could push up manufacturing costs and pressure margins ahead.

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“Cheating Karta Hai Tu “: RBI Imposes FEMA Compounding Penalty On Paytm

The Reserve Bank of India has imposed a compounding penalty of ₹18.8 Lakh on fintech major Paytm over an alleged FEMA violation.

In an exchange filing, the company said it is in the process of paying the compounding fee, after which the matter will be disposed of.

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“Achha Toh Hum Chalte Hai”: Exits Continue At Peak XV As Three MDs Depart To Set Up New VC Firm

Senior-level exits continue at Peak XV with MD Ashish Agrawal stepping down in a mutually agreed move, citing the long-term interests of the firm and its LPs.

Fellow MDs Tejeshwi Sharma and Ishaan Mittal have also resigned to join Agrawal, with the trio set to team up to launch a new venture capital firm.

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“Hum Saath Saath Hai”: HORIBA acquires Pristine Deeptech to strengthen R&D

HORIBA India has acquired a 100% stake in Pristine Deeptech to bolster its R&D capabilities.

The lab-grown diamond-focused startup, which works on semiconductor and quantum research, will now operate as a wholly owned subsidiary of HORIBA India.

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1. Loop AI has raised $14 Mn to scale its restaurant-focused AI product suite and ramp up hiring. Founded in 2022 by Anand Tumuluru, Sundar Annamalai, and Vinod Pachipulusu, the startup offers automated back-office assistance to food and retail brands.

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2. Mindcase has raised ₹1.5 Cr in a pre-seed round led by early-stage VC firm AJVC. The capital will be used to scale its self-serve SaaS platform and deepen data and intelligence coverage across new domains and markets.

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3. Drivn has secured financing commitments of up to $80 Mn from global financial services group Nomura. The capital will fund Phase 1 deployment of nearly 1,000 electric buses and trucks across inter-city and heavy commercial transport segments.

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