Karnataka Picks 256 Deeptech Startups for Elevate Nxt 2026

Key Takeaways

• 256 deeptech startups selected from 983 national applicants
• Each startup eligible for up to ₹1 crore in non-dilutive grant funding
• Program expanded nationally for the first time after nearly a decade of Karnataka-only focus

Karnataka's IT/BT department wrapped up Elevate Nxt 2026 on Wednesday, selecting 256 deeptech startups from a pool of 983 applicants. For the first time, the program accepted applications from across India rather than limiting itself to Karnataka-based companies.

The Elevate initiative has supported early-stage companies in Karnataka for nearly a decade. This year's expansion reflects the state's ambition to position itself as the anchor for India's broader deeptech ecosystem.

What the Program Offers

Selected startups receive grant-in-aid support of up to ₹1 crore. The funding is milestone-based, meaning disbursements are tied to progress benchmarks rather than delivered upfront. The package also includes domain-specific mentorship and access to Karnataka's startup ecosystem infrastructure.

The non-dilutive nature of the funding is significant. Unlike venture capital, these grants don't require founders to give up equity. For capital-intensive deeptech ventures, where R&D costs are high and revenue timelines are long, this structure lets founders derisk early development without diluting ownership.

Sectors and Selection

Applications came from startups working in AI and machine learning, quantum technologies, spacetech, healthtech, cleantech, mobility, and other frontier domains. The department did not break down how many startups were selected in each sector.

The entire selection process took 60 days. The department highlighted this timeline as evidence of the program's efficiency and institutional coordination.

“For close to a decade, Elevate has empowered Karnataka's early-stage startups by providing grant-in-aid support and the right ecosystem to scale bold ideas. It was incredible to witness innovators tackling some of the most complex challenges across frontier technologies.”

— Priyank Kharge, Karnataka IT/BT Minister

National Expansion Strategy

Opening the program nationally marks a strategic shift. Karnataka already hosts India's largest startup ecosystem, centered in Bengaluru. By drawing applicants from other states, the government is betting it can attract top deeptech talent to build within Karnataka's support infrastructure, even if the startups weren't founded there.

“The scale, diversity and quality of participation this year highlights the growing strength of India's deeptech ecosystem and Karnataka's role as its anchor.”

— N Manjula, IT/BT Department Secretary

The competition rate this year was roughly 1 in 4. Out of 983 applicants, 256 made it through. That's a 26% selection rate, which suggests the program isn't purely competitive theater but is genuinely trying to fund a meaningful portion of qualified applicants.

The Grant vs. Venture Debate

Industry discussions around Elevate Nxt often circle back to a recurring question: can government grants effectively substitute for venture capital in deeptech? The short answer is no, but that's not the point.

Grant programs like Elevate Nxt serve a different function. Deeptech startups often spend years in R&D before they have a product to sell. VCs typically want to see market traction before writing checks. Government grants fill that gap by funding the research phase, after which startups can approach VCs with something tangible.

The non-dilutive structure also preserves founder equity for later funding rounds when valuations are higher. A founder who takes ₹1 crore in grants instead of seed funding keeps ownership they'd otherwise lose.

What Happens Next

The 256 selected startups will now enter the program's mentorship and milestone-tracking phase. Funding disbursements will depend on hitting agreed benchmarks. The department hasn't published the specific milestones required or the timeline for fund releases.

For startups that didn't make it this round, Elevate has historically run annual cohorts. The national expansion suggests future cycles will continue accepting applications from outside Karnataka.

Frequently Asked Questions

How much funding does Elevate Nxt 2026 provide?

Selected startups can receive up to ₹1 crore in non-dilutive grant funding, disbursed based on milestones.

Who can apply for Elevate Nxt?

The 2026 cycle accepted applications from deeptech startups across India, expanding beyond its previous Karnataka-only focus.

What sectors does Elevate Nxt cover?

The program supports AI/ML, quantum technologies, spacetech, healthtech, cleantech, mobility, and other frontier technology domains.

How competitive is Elevate Nxt selection?

For 2026, 256 startups were selected from 983 applicants, a selection rate of about 26%.

Is the Elevate Nxt grant dilutive?

No. The funding is grant-in-aid, meaning startups don't give up equity to receive it.

Source: Tech-Economic Times / ET