<p>Bengaluru: Amid the ongoing geopolitical tensions in West Asia and instability, venture capital (VC) firms are slowly shifting their focus towards renewable energy startups. Data sourced from market intelligence firm Tracxn revealed that in January-March 2026 alone, energy tech startups raised $640.6 million, accounting for almost 36% of the total funding they raised in the full year 2025. In 2025, energy tech startups raised $1.8 billion across 139 rounds, and in 2024, they raised $1.4 billion across 209 rounds.</p>.<p>According to VCs and analysts that DH spoke to, there is a renewed push towards renewable energy and energy security in India. They said that renewables are finally getting the serious attention they deserve, and global uncertainty is accelerating that conversation rather than creating it from scratch.</p>.<p>There are over 4,900 energy tech startups in the country, and out of these, 805 startups are funded. These include Ather Energy, Yulu, Euler Motors and Blu-Smart. When it comes to renewable energy tech, there are 312 startups in India, including Ecofy, Aerem and SustVest, among others.</p>.<p>Vasudha Madhavan, Founder & CEO, Ostara Advisors, said some of their portfolio companies are getting calls to say how they can potentially receive an investment or look at how they can increase partnerships.</p>.<p>She said areas such as biofuel, solar and others should receive a boost because the narrative seems to have shifted now from just decarbonisation to energy security, which is an even bigger priority for India. "These will continue to drive investments in renewables, deeptech, sustainability and energy transition," she added.</p>.<p>Is there any decrease in AI funding as VCs are now focusing on energy tech? Venture capitalists that <span class="italic">DH</span> spoke to said there would not be any slowdown in funding in AI startups, as West Asia has been focusing more on AI.</p>.<p>Umakant Soni, Co-Founder and CEO of Bharat1.AI, which is building the first humanity-centric AI City in Bengaluru, said there is not much impact on funding in the short-term; however, if this continues for a long time, expensive oil makes everything tricky. "Strategic autonomy in energy and defence will drive investment themes," he said.</p>.<p>Ongoing geopolitical tensions are introducing a degree of uncertainty across global financial markets, which can indirectly influence startup ecosystems worldwide, Neha Singh, Co-Founder, Tracxn, said.</p>.<p>According to her, this can impact late-stage investments and IPO timelines as global investors reassess exposure to higher-risk assets.</p>.<p>Analysts stated that companies might go slow when it comes to funding in AI startups, but Abhishek Srivastava, General Partner at Kae Capital, is of the view that there would not be a blanket pull-back from AI as a category.</p>.<p>If anything, the fundamentals driving AI adoption remain strong. What we are seeing, however, is investors becoming more deliberate. There's a sharper focus on unit economics, revenue visibility, and whether a startup can weather a prolonged period of uncertainty. The frothy, thesis-driven bets of 2021-22 are largely behind us. Today, even the most-compelling AI pitch needs to show a credible path to value, not just a demo, he added.</p>.<p>In India, the AI conversation is very much alive across sectors, whether it's education, health & wellness, compliance, or logistics. "What's changing is the bar. Investors are asking harder questions about defensibility. Is this truly an AI-native solution or just a lean wrapper? Does the AI component drive the margin structure or is it just a feature? Those conversations are healthy, and honestly overdue. The deals that are slowing down are the ones that couldn't answer those questions clearly to begin with," he said.</p>.<p>Srivastava said there's definitely a renewed urgency around energy security and climate, and the two are closely linked in this environment. "We are seeing more VC interest in energy transition plays in India, particularly in distributed energy solutions, microgrids, home energy automations,” he said, adding that he would not frame it as VCs choosing renewables over AI. It's that renewables are finally getting the serious attention they deserve, he opined.</p>
<p>Bengaluru: Amid the ongoing geopolitical tensions in West Asia and instability, venture capital (VC) firms are slowly shifting their focus towards renewable energy startups. Data sourced from market intelligence firm Tracxn revealed that in January-March 2026 alone, energy tech startups raised $640.6 million, accounting for almost 36% of the total funding they raised in the full year 2025. In 2025, energy tech startups raised $1.8 billion across 139 rounds, and in 2024, they raised $1.4 billion across 209 rounds.</p>.<p>According to VCs and analysts that DH spoke to, there is a renewed push towards renewable energy and energy security in India. They said that renewables are finally getting the serious attention they deserve, and global uncertainty is accelerating that conversation rather than creating it from scratch.</p>.<p>There are over 4,900 energy tech startups in the country, and out of these, 805 startups are funded. These include Ather Energy, Yulu, Euler Motors and Blu-Smart. When it comes to renewable energy tech, there are 312 startups in India, including Ecofy, Aerem and SustVest, among others.</p>.<p>Vasudha Madhavan, Founder & CEO, Ostara Advisors, said some of their portfolio companies are getting calls to say how they can potentially receive an investment or look at how they can increase partnerships.</p>.<p>She said areas such as biofuel, solar and others should receive a boost because the narrative seems to have shifted now from just decarbonisation to energy security, which is an even bigger priority for India. "These will continue to drive investments in renewables, deeptech, sustainability and energy transition," she added.</p>.<p>Is there any decrease in AI funding as VCs are now focusing on energy tech? Venture capitalists that <span class="italic">DH</span> spoke to said there would not be any slowdown in funding in AI startups, as West Asia has been focusing more on AI.</p>.<p>Umakant Soni, Co-Founder and CEO of Bharat1.AI, which is building the first humanity-centric AI City in Bengaluru, said there is not much impact on funding in the short-term; however, if this continues for a long time, expensive oil makes everything tricky. "Strategic autonomy in energy and defence will drive investment themes," he said.</p>.<p>Ongoing geopolitical tensions are introducing a degree of uncertainty across global financial markets, which can indirectly influence startup ecosystems worldwide, Neha Singh, Co-Founder, Tracxn, said.</p>.<p>According to her, this can impact late-stage investments and IPO timelines as global investors reassess exposure to higher-risk assets.</p>.<p>Analysts stated that companies might go slow when it comes to funding in AI startups, but Abhishek Srivastava, General Partner at Kae Capital, is of the view that there would not be a blanket pull-back from AI as a category.</p>.<p>If anything, the fundamentals driving AI adoption remain strong. What we are seeing, however, is investors becoming more deliberate. There's a sharper focus on unit economics, revenue visibility, and whether a startup can weather a prolonged period of uncertainty. The frothy, thesis-driven bets of 2021-22 are largely behind us. Today, even the most-compelling AI pitch needs to show a credible path to value, not just a demo, he added.</p>.<p>In India, the AI conversation is very much alive across sectors, whether it's education, health & wellness, compliance, or logistics. "What's changing is the bar. Investors are asking harder questions about defensibility. Is this truly an AI-native solution or just a lean wrapper? Does the AI component drive the margin structure or is it just a feature? Those conversations are healthy, and honestly overdue. The deals that are slowing down are the ones that couldn't answer those questions clearly to begin with," he said.</p>.<p>Srivastava said there's definitely a renewed urgency around energy security and climate, and the two are closely linked in this environment. "We are seeing more VC interest in energy transition plays in India, particularly in distributed energy solutions, microgrids, home energy automations,” he said, adding that he would not frame it as VCs choosing renewables over AI. It's that renewables are finally getting the serious attention they deserve, he opined.</p>