Peak XV Raises $1.3B to Fuel AI and Fintech Expansion in India Amid Global VC War
India's leading venture capital firm Peak XV has closed a $1.3 billion fund, signaling a bold bet on artificial intelligence, fintech, and cross-border innovation as global investors intensify competition for India’s tech ecosystem. The move comes amid leadership shifts and rising pressure from U.S. and Middle Eastern funds seeking a foothold in the world’s fastest-growing major economy.
Peak XV Raises $1.3B to Fuel AI and Fintech Expansion in India Amid Global VC War
India’s preeminent venture capital firm, Peak XV, has successfully raised $1.3 billion in new capital, marking one of the largest fundraising rounds by a private equity firm in South Asia this year. The fund, announced on February 20, 2026, will be primarily deployed to back early- and growth-stage startups in artificial intelligence, fintech, and cross-border digital commerce — sectors that are rapidly reshaping India’s economic landscape. The move underscores Peak XV’s determination to maintain its leadership position as global investors, including U.S.-based giants and Middle Eastern sovereign wealth funds, increasingly vie for access to India’s burgeoning tech ecosystem.
According to TechCrunch, the capital infusion comes at a pivotal moment for the firm, which has recently experienced the departure of several key partners, including longtime managing director Ravi Mehta and venture partner Priya Nair. These exits, while unannounced in detail, have raised questions about internal stability. Yet Peak XV has responded not with retreat, but with aggressive reinvestment. The firm confirmed that over 80% of the new fund will be allocated to Indian startups, with a strong emphasis on AI-driven enterprises that can scale regionally and globally. This includes investments in generative AI tools tailored for India’s multilingual digital users, embedded fintech platforms serving the unbanked, and logistics startups leveraging AI for last-mile delivery optimization.
"India is no longer just a market for consumption — it’s becoming a global hub for innovation," said a senior Peak XV executive, speaking on condition of anonymity. "Our focus is on companies that can build products here and export them to Africa, Southeast Asia, and Latin America. AI is the engine, but the real opportunity lies in adapting it to India’s unique infrastructure challenges and consumer behaviors."
The firm’s strategy reflects broader global trends. U.S. firms like Sequoia Capital and a16z have significantly increased their India-focused teams, while Saudi Arabia’s Public Investment Fund and Abu Dhabi’s Mubadala have established direct investment offices in Bengaluru and Gurgaon. Peak XV, formerly the India arm of Sequoia before spinning out in 2022, now competes not just on brand recognition, but on local expertise and speed of execution.
Analysts note that Peak XV’s timing is strategic. India’s digital public infrastructure — including UPI, Aadhaar, and the Digital Identity Stack — has created fertile ground for fintech innovation. Startups like Razorpay, PhonePe, and ZestMoney have already demonstrated the scalability of India’s model. Peak XV’s new fund will target the next wave: AI-native companies building vertical-specific solutions in healthcare diagnostics, agritech, and education technology.
Despite the turbulence of recent leadership changes, the firm has retained its core investment team and maintained strong LP support from institutional investors in North America, Europe, and Singapore. The $1.3 billion raise also includes a secondary component, allowing early investors to partially exit — a sign of confidence in the portfolio’s valuation trajectory.
As global capital flows into India accelerate, Peak XV’s latest move signals that local champions are not just keeping pace — they’re setting the agenda. With AI adoption expected to contribute over $500 billion to India’s GDP by 2030, according to McKinsey, the firm’s bet may prove to be not just profitable, but historically defining.
