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It’s time for our next special issue: a guest article by Dr. Maximilian von Laer and Dr. Florian Ramel on Indian Private Markets: An Opportunity for European Investors.

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The authors of today’s guest article are our fellow Risers Dr. Maximilian von Laer and Dr. Florian Ramel.

As founders of India Catalyst, Maximilian and Florian provide companies and investors access to India’s economic success and create sustainable opportunities for both sides.

Maximilian lived in Delhi for several years and has extensive experience in strategy, investment management and the operational implementation of German-Indian business projects. Florian built and managed a portfolio of venture capital and private equity funds in a German family office and has extensive experience in business management.

Both have been working together on various projects in science (Innovation Economics), business (Family Office) and volunteering (IGYLF) for over ten years. With the Indo-German Young Leaders Forum (IGYLF), they built a platform in 2016 that is now one of the most important non-governmental initiatives between Germany and India.

Enjoy the guest article!

Maximilian and Florian are recommending a book by Walter Lindner:

“Der alte Westen und der neue Süden: Was wir von Indien lernen sollten, bevor es zu spät ist | Das indische Jahrhundert beginnt – aber wo bleibt Europa?” / “The Old West and the New South: What we should learn from India before it's too late | The Indian century is dawning – but where is Europe?”.

By Dr. Maximilian Von Laer and Dr. Florian Ramel

India's private markets have graduated from "emerging" to "functioning," yet European investors remain conspicuously absent. With billions in annual PE/VC activity, a strong IPO exit rate, and regulatory reforms that have eliminated key investor pain points, the market now offers institutional-scale opportunities with proven liquidity. This article makes the case for why European allocators should increase their India exposure and why now is the optimal entry point.

In November 2024, a food delivery startup founded just ten years earlier in Bangalore listed on India's stock exchanges at an $11.3 billion valuation—the largest tech IPO globally that year. Swiggy's journey from a 2014 startup delivering 500 orders per day in one city to a $1.4 billion public offering encapsulates India's private markets transformation. Early venture investors Accel and Elevation Capital, who backed the company in 2015 at an ₹11 (~$0.20) per share acquisition cost, saw returns exceeding 3,300% in INR terms at the IPO price of ₹390 (~$4.50). This isn’t an outlier but a showcase of what patient capital deployed through India's maturing private markets ecosystem can achieve.

The private markets story is compelling: $170 billion in commitments across 1,700+ funds, $50 billion in total PE/VC investments during 2025, and a maturing ecosystem where domestic managers drive over 90% of VC fundraising. VC funding specifically reached approximately $11 billion in 2025, with deal volumes rising 11% year-over-year.

The exit infrastructure works: 59% of PE/VC exits in 2024 came through IPOs. Domestic champions like Kedaara Capital ($1.7B fund, 2024) and ChrysCapital ($2.1B, 2025) combine local expertise with international governance standards. Regulatory improvements like the angel tax elimination, a capital gains tax reduction and streamlined bankruptcy processes signal a pro-investment trajectory. Especially for European allocators, we argue, there are good reasons to increase their India exposure.

India's private markets have evolved significantly over two decades, from early international VC firms establishing operations in the 2000s through the 2016-2019 platform-scale boom, to today's selective re-allocation phase. After the 2021 liquidity peak ($42 billion in VC funding), the market reset: VC funding moderated to $9.6 billion in 2023, then rebounded to $13.7 billion in 2024. The trend continued into 2025 at slightly lower levels—signaling early maturation rather than consolidation.

Homegrown PE firms now lead deployment at unprecedented scale. A whole ecosystem of established managers focus on $50-350 million opportunities where operational involvement creates value. Their exits—including Kedaara's Manyavar and AU Small Finance Bank, ChrysCapital's NSE continuation fund—validate their build-and-exit capabilities.

The VC transformation is striking: Indian VC fundraising is almost exclusively driven by domestic funds. Indian family offices are becoming more active participants in the startup ecosystem. This domestic capital provides stability when global LP fundraising tightens. At the same time, foreign capital is sought after, providing an access opportunity for global investors.

The market offers compelling returns but requires navigating distinct governance and regulatory frameworks that have improved meaningfully over the past three years.

Structural shifts favor institutional capital. "Reverse flipping" is accelerating as startups like Razorpay, Zepto, and Meesho relocate domiciles back to India, attracted by regulatory simplification, stronger IPO valuations, and angel tax elimination—creating clearer legal structures and reduced regulatory arbitrage concerns.

Promoter culture requires cultural intelligence. Indian companies typically feature concentrated "promoter" shareholding—families retaining control even post-investment. This isn't necessarily negative: Promoter-led businesses often outperform because aligned families drive long-term value. More promoters now accept institutional governance as IPO preparation, recognizing that institutional investors demand transparent reporting and independent directors. Partnering with GPs who navigate this balance successfully is critical.

Execution quality varies but talent is deep. India offers extraordinary engineering and professional talent, though standards differ by sector. Consumer internet excels at digital acquisition and logistics; SaaS exporters run lean with strong unit economics; manufacturing requires patient capital but the "China+1" opportunity is tangible. The "Make in India" initiative and Production Linked Incentive (PLI) schemes create opportunities in electronics, pharma, and auto components. With roughly 20% of globally sold iPhones being made in India the narrative about low quality or reliability is long outdated. With opportunities and challenges side by side, it is paramount to have local partners to navigate such investments.

Exit pathways validate India's thesis. In 2024, $33 billion in realized exits (up 16% YoY) demonstrated that capital generates meaningful returns, and 2025 sustained strong exit activity with IPOs including major listings like Groww (fintech). India added six new unicorns in 2025 alone, bringing the total number to an astonishing 125.

Public markets provide the primary highway. India's IPO market delivered 59% of PE/VC exit value in 2024. India's public markets offer genuine liquidity at institutional scale and domestic buying means exits don't depend too much on foreign flows.

Secondaries are maturing. Notable sponsor-to-sponsor deals include KKR's $840 million Healthium acquisition from Apax Partners and TPG's $800 million Care Hospitals sale to Blackstone. As funds are maturing, secondary volumes will grow, creating opportunities to acquire proven positions at reasonable valuations.

Strategic M&A is improving. Deals like Tata Consumer's $460 million Capital Foods acquisition show the dynamic of this path. Control transactions have become mainstream, reaching 51% of PE deal value in 2024 compared to just 37% in 2022.

The exit environment demonstrates that India's private markets have graduated from "emerging" to "functioning." Capital can be deployed, value built, and exits executed at institutional scale.

India's private markets stand at an inflection point: mature enough to deploy significant capital, yet early enough to generate compelling returns over the next decade. Exit pathways have proven consistent and validate that disciplined mid-market investments can generate healthy returns.

Yet India remains underrepresented in most European portfolios. Foreign ownership of Indian public market equities stood at less than 20% as of September 2025. Macquarie strategists observed in March 2025 that most EU investors were merely thinking of cutting their underweight stance rather than going overweight, a step in the right direction but demonstrating slow reactivity to changes in India's investability. Looking at private markets, we find that while foreign capital plays an important role in the cap tables of the major actors, Europeans are strongly underrepresented both in numbers and volume.

For European allocators seeking growth in a deglobalizing world, this converges into a compelling case. India offers diversification through growth with low correlation to European economies, institutional-scale deal flow, proven liquidity, and domestic GPs meeting international standards. Secondary markets provide flexible entry points and domestic capital offers stable co-investment partners.

Sources in article: SEBI, Bain, KKR, Blackstone, Times of India

For sources and further information, please contact the authors at [email protected]

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