India, May 8 -- When Sanjay Nayar, the former KKR India head, announced starting his own early stage venture fund Sorin Investments in 2022, it quickly became the buzz of town. This was in 2022, when the Indian startup ecosystem was already experiencing the bite of the funding winter. Nayar was not discouraged by the market mood.

But it was an unusual move to go from a private equity fund to early stage VC. At that time, Nayar reportedly said startups were incorrectly assuming that VCs were just waiting on the sidelines with dry powder and watching for the right opportunity. It turned out to be more than just temporary caution.

"This aberrant funding came as India's startup ecosystem was at an inflection point," Nayar said. His view was...