Ajay Kumar, former defence secretary of India, has entered the venture capital industry by establishing Mounttech Growth Fund, focusing on early-stage startups in the defence, aerospace, and deeptech sectors. The Rs 250 crore fund, approved by the Securities and Exchange Board of India (SEBI), has received subscriptions worth Rs 280 crore and plans to invoke the green-shoe option for another Rs 250 crore.

The fund's first scheme, Kavach, is primarily sponsored by Suryakant Dalmia of Dalmia Securities, alongside other high-net-worth individuals and domestic family offices. Kumar serves as chairman, with former telecom executive Ravi Sethia as CEO. The advisory board includes top retired armed forces officers like former Indian Air Force chief RKS Bhadauria and former Indian Navy vice chief SN Ghormade.

Kumar highlighted the increased opportunities for startups in the defence and aerospace sectors due to government initiatives like the Innovations for Defence Excellence (iDEX) programme, which supports startups with grants and contracts. iDEX is engaged with about 400 startups, having cleared procurement of 35 items worth Rs 2,000 crore.

Mounttech Growth Fund aims to finalize its first investment in the space sector soon. The fund will collaborate with other VC firms and incubators at institutions like the Indian Institute of Science in Bengaluru and IIT Kanpur. In 2023, aerospace, defence, and maritime sectors received $230 million in funding, with $74.1 million raised in 2024 so far. Notably, Newspace Research & Technologies secured $52 million in March for its swarm drone technology.