India’s AI startup market has received another strong signal from investors. VC firm Activate has closed its maiden AI-focused fund at $105 million, with a plan to back young companies building around artificial intelligence.

Activate was founded in December 2025 by Aakrit Vaish, former CEO and co-founder of Haptik, and Pratyush Choudhury, a former partner at Together Fund.

The firm calls itself an India-native AI venture firm and wants to support founders from the very beginning, sometimes even before a company is formally incorporated.

Activate fund – What the $105 million includes

As per Dealroom, Activate’s maiden fund includes an $85 million early-stage vehicle and $20 million through dedicated growth investment vehicles. The fund has reportedly closed above its original target, which shows strong investor confidence in India’s AI opportunity.

The firm plans to back around 25 to 30 startups. Its first cheques are expected to be in the range of $500,000 to $3 million. These investments will mostly go into pre-seed, seed and idea-stage AI startups.

In simple words, Activate is not waiting for startups to become big before investing. It wants to work with founders when the idea is still being shaped.

What Activate wants to invest in

Activate is focusing on three broad areas – AI applications, foundational models and physical infrastructure.

AI applications are tools that solve real business or consumer problems using AI. For example, an AI tutor for students, an AI sales assistant for small businesses or an AI tool for doctors to manage patient notes.

Foundational models are deeper technology plays, such as language, voice, video or coding models built for specific needs. Physical infrastructure can include compute, robotics or hardware-linked AI systems.

The firm believes India can create strong AI companies in sectors where the country already has scale, such as commerce, financial services, education, healthcare and services.

Why this fund matters for Indian AI startups

AI startups need more than money. They need access to models, cloud credits, technical feedback, hiring help and customer introductions. Activate is trying to build that support system around its fund.

The firm says its network includes a GenAI community of more than 15,000 technical practitioners. It has also listed partnerships with major AI and cloud companies such as NVIDIA, OpenAI, Anthropic, AWS, Microsoft Azure, Google Cloud and Notion. Portfolio companies may get up to $1 million in credits and benefits.

For an early-stage startup, this can be useful. A small team building an AI product may spend heavily on cloud and model usage before earning revenue. Support like credits and technical access can reduce early pressure.

Investors and early bets

Activate’s limited partners include founders, AI researchers, family offices, enterprises, global VC partners and well-known technology investors. Names mentioned across reports and the firm’s website include Vinod Khosla, General Catalyst, Vijay Shekhar Sharma, Ronnie Screwvala and Ranjan Pai.

The firm has already made investments in startups such as Sarvam AI, ElevenLabs and Wispr Flow. It has also backed several early-stage companies through its Inception strategy, though some of them are still in stealth.

Competitors and market context

Activate is entering a busy space. Other investors are also increasing their focus on AI and deeptech. Accel has launched a large AI and deeptech fund, while Elevation Capital has also moved strongly toward AI-focused investing.

The difference Activate wants to create is early involvement. Its aim is to work closely with founders at day zero, help refine the idea and then support product, hiring and future fundraising.