Gayatri Sarkar, CEO
The venture capital industry is crucial in the global race to dominate artificial intelligence. This pursuit is met with persistent impediments rooted in the mounting fakes, bias and resulting harms that reveal how nascent and brittle our systems are. Ethics and safety are now synonymous with diversity, equity and inclusion. Regulatory attention and public awareness now focus on the potential individual consequences. As AI technology pervades sectors, cultures, and societies, it is imperative that its benefits reach everyone. This heightened awareness has extended to venture capital (VC) as well. In a sector that has been slow to progress, “capital decisions” continue to be made by a homogenous group.
Gayatri Sarkar is the Founder and CEO of Advaita Capital, one of the few women-owned, person-of-color-led venture capital firms in the industry. Sarkar and Advaita Capital persevere as a Series C fund in a tight industry that has an incredible influence on technological progress. I sat down with Sarkar to talk about where we are today as new capabilities continue to surface; and how organizations such as hers navigate in an ecosystem that has also struggled to advance with the demands of our time.
Historically, large VC institutions lacked diversity, but some would argue that there are some positive changes underway. In 2023, women made up 26% of the VC workforce, 50% growth from 2016. The percentage of firms that reported they do not have any female investment partners decreased to 57% in 2023, down from 68% in 2018. This signals progress however, Black employee representation remains a challenge: At the senior levels, Black employees account for 4%, a slight increase from 3% in 2018.
Gayatri Sarkar is one of the trailblazers in venture capital. A Series C fund, Advaita operates with a clear focus on deep tech, investing in technologies that “propel the human race forward, with a keen eye on decarbonization and the energy transition.” Sarkar adds their sweet spot lies in companies with $25MM in annual recurring revenue (ARR).
The Path Towards Startup, Advaita Capital and She-VC
Gayatri Sarkar never aspired to be a venture capitalist (VC) or an entrepreneur. Initially, Sarkar pursued an advanced physics degree, secured a job, and then relocated to the US. Sarkar’s professional journey included stints at Hewlett-Packard, IBM, and Goldman Sachs. Sarkar also worked with the Federal Reserve Bank, managing U.S. Treasuries assets for the U.S. military Navy, as well as at several large banks such as JP Morgan, PNC and GND, Visa. After Sarkar’s tenure at the Federal Reserve Bank, some of the largest hedge funds in the U.S. and London expressed interest in Sarkar joining their teams.
It was then Sarkar started a podcast, when video podcasts were not as common as they are today. Her initial research revolved around the scarcity of female voices in the tech industry. She often found herself as one of the few women in the room and wondered where the women leaders and advocates in this space were. It is what led Sarkar to create the She-VC podcast, and invited female GPs from closed funds, and women LPs managing pension funds, with the intention to curate the voices and ultimately, level the playing field in the investment industry.
Shortly after, Sarkar decided to pursue her own startup-VC. Advaita Capital was born. The name “Advaita” holds deep significance for Sarkar. Sarkar discovered personal spirituality through philosophy and drawing parallels to quantum physics and Schrödinger’s cat, where observation determines reality, Sarkar found resonance as she explains,
“I cannot think of a better name that points towards the entire cosmic spiritual that exists, and the quantum physics of it all, which is non duality. So, I do believe space-time works very differently and whether we live in a simulation or where we are at, we just don’t know.”
Advaita operates with a clear focus: deep tech: “We invest in technologies that propel the human race forward, with a keen eye on decarbonization and the energy transition.” Sarkar emphasizes their support for companies that align with the decarbonization mission: “…it’s a niche space but we’re committed to finding those rare gems. As we move forward, we’re open to early growth series investments with the goal to back innovators who drive change and create a more sustainable future.”
Entering the VC Space and Raising
As a new venture capital firm that is unlike the established firms, Sarkar describes her experience as Advaita enters this closely networked community of investors and why they had chosen to invest in growth stage companies,
“Our venture capital firm stands out as one of the few women-led, person-of-color-led venture capital firms in the industry. Unlike early-stage venture capital, we’ve deliberately chosen to focus on growth-stage investments. While there are remarkable women making strides in early-stage funding, our team’s background leans heavily toward private equity. We boast a wealth of expertise from institutions like Harvard, MIT, Wharton and Yale.
As a Growth investment fund, Advaita operates very differently from early-stage investments. As per Sarkar, “We don’t typically engage in powder [undeployed capital] unless we have thematic led investments and have completed thorough technical due diligence. However, we’re witnessing the consequences of excessive capital deployment—sometimes leading to index funds that fall short. This approach doesn’t align with the essence of venture capital. VC thrives on the ingenuity of people, especially founders. It’s not about backing a B-team or a specific product; it’s about investing in the team itself. Whether the product is an A or B initially, continuous iterations can elevate it. As investors, we champion this iterative spirit.”
The team’s blend of large asset management and deep tech expertise uniquely positions them towards as Sarkar puts it, “black holes” or untapped opportunities where they can invest in outliers,
“We invested in Neuralink, when the invasive chip insertion was not FDA approved and even the idea was scary. We did a detailed analysis on risk management and how the future can change the human evolution starting from a quadriplegic, paraplegic to be self-sufficient.”
Advaita also invested in Canadian generative AI startup, Cohere in 2023, where, as she reveals, “enterprise focus sparse model as a cost of training large LLMs is staggering.” Sarkar indicates the importance of data privacy in enterprise solutions and suggests Cohere will be the first generative AI startup to be backed by a pension fund in the next round.
Sarkar’s fundraising efforts primarily involved institutional limited partners (LPs). This was intentional as she details,
“It was an arduous process, but essential for meaningful conversations. You see, I have what I call ‘single child syndrome.’ If I want something, I pursue it relentlessly. My background in physics, math, and behavioral economics reinforces the importance of first principle thinking—understanding how money flows. One of our initial decisions was to avoid accepting funds from ultra-high net worth individuals or smaller family offices. Instead, we sought larger sums of capital for separately managed accounts, follow-on investments, and co-investments. Fortunately, all our LPs are established institutions. Convincing them took time, but I never compromised on our investment criteria. We focus exclusively on extreme outliers—the best of the best. Our competition includes heavyweights like Sequoia and Thrive, but remember, even they started from somewhere.”
A VC Sector Marred by Lack of Representation
These statistics highlight a significant disparity:
Representation in VC Deals: In the US, female-founded companies represent 25% of the total venture capital (VC) deal count. However, the proportion of total deals has remained relatively flat at around 17% year over year.
General Partners in VC Firms: Only 16% of general partners in VC firms are women.
VC Investment Share: Women-led startups receive less than 3% of all VC investments.
Sarkar recognizes there is still more work that needs to be done. She reflects,
“Many women find themselves having to IPO their companies after Series A and B rounds because they struggle to raise funds for Series C and D. The lack of women writing larger checks is a significant issue. Venture capital, once a nascent asset class, has evolved but it remains challenging to secure a spot on the cap tables of certain firms.”
And while having a champion that vouches for your company can make all the difference, Sarkar indicates that the hurdles they face as a growth fund when it comes to board approvals are symptoms of a broader systemic problem. One issue is the scarcity of women leading growth funds and when she started Advaita, she was counselled to raise an early-stage fund. However, Sarkar was adamant their focus was growth. Advaita marched ahead to address the unique investment landscape they chose to navigate.
For early-stage female founders, Sarkar recognizes more are actively raising funds but contends that the industry must provide stronger support for their transition into the growth stage,
“Fortunately, we’re witnessing more women successfully running early-stage fund and they may evolve into Series A or B-type funds. But there’s work ahead. We need education and we need to break stereotypes and recognize women’s contributions across fields. It’s crucial to channel more capital into the hands of women and encourage institutional support.”
From her own experience, Sarkar reflects on the startup ventures she launched in her earlier years. Those were formative years and she received valuable advice from Wall Street legends that have guided her to this day:
“This journey isn’t a sprint, but a continuous marathon. Venture capital, especially in Silicon Valley, embraces a culture where failure isn’t catastrophic. Instead, it’s seen as a steppingstone. Whether it’s your second, third, fifth, or tenth startup, the penalties for failure are minimal compared to the immense rewards for innovation.”
Sarkar also realizes that a broader shift in mindset must recognize the professional journeys women must navigate that will eventually meet with additional complexity: “The questions arise, ‘When will you marry?’ ‘Do you plan to have children?’ ‘Who will care for them?’” When someone poses these questions, Sarkar says this is a signal that investors “won’t be opening their purse strings. Not a single cent.” The query about childcare responsibilities is rarely directed at men but she celebrates some progress:
“Notable funds like Check Warner, Amboy Street Ventures, and Card Line Her Fund are stepping up. They’re championing founders by supporting daycare systems. As a mother, I understand, firsthand, this juggling act. My CFO has both a nine-month-old and a two-year-old. This is today’s reality. Many women now have children later in life due to career demands. The industry must evolve to ensure that career transitions align with life changes.”
Sarkar firmly believes that a woman’s body requires at least six months to recover after childbirth and she is adamant, “This conviction should permeate venture capital funds and corporate structures. It’s about nurturing the incredible talent of women returning to the field and for this to happen, support is essential.”
Within her own firm, unlimited sick leave and vacation days are the norm. She is resolute,
“Venture capital isn’t merely work; it’s a lifestyle. Despite the relentless pace, I want to give my team the freedom to take the necessary breaks as needed.”
Recalling her Wall Street days, Sarkar recalls when a female colleague approached her, announcing her pregnancy and imminent departure from the firm. The boss advised her that leaving the fund—instead of taking an extended maternity leave—would be more advantageous for her career. This regressive mindset struck Sarkar profoundly. She was firm,
“I refused to accept money from that limited partner. Here’s the irony, it’s these highly educated bosses Ivy League graduates that perpetuate these updated norms. Remarkably, this sole female in her field, continued to work tirelessly. Even while she was six months pregnant, she traveled between San Francisco and New York, committed to her responsibilities.”
Investing in AI, Deep Tech and Sustainability
Sarkar believes we are squarely in a moment of immense infrastructure growth. In parallel to the transformative shifts of the 1960s and 1970s that fueled the Internet’s rise, she predicts a similar trajectory over the next 25 to 30 years:
“Not only will AI drive computing power, but quantum physics will also witness breakthroughs. Despite the challenges posed by physics, quantum computing is poised for progress. Chip design will flourish, and perhaps even interplanetary travel or flying cars will become reality. This era heralds the emergence of new Silicon Valleys, where investments extend beyond apps.”
As an investor, Sarkar marks this moment in time as a huge playground to learn. She reflects, “We will see robots in everyone’s home managing mundane household jobs.” For her team the investment decision means understanding the macro-level shifts and how changes at the infrastructure level evolve that will instigate these impacts,
“I think generative AI is at a very early phase. It is like an infant, full of promise and wonder. While we marvel at its capabilities with the seamless text to video or text to image translation, when I wear my investor hat I want to understand where we can make real change, where the barrier to computing power will decrease or increase energy efficiency.”
She also recognizes the integration of Edge AI devices coupled with different sensory systems can facilitate collaborative interactions between humans and robots, whether in a warehouse or at home. But the broader legal, ethical and and infrastructure implications need to also be address, as Sarkar questions: “Which are the companies that have the corporate governance to make things sustainable? What is also surfacing is this interesting dichotomy between open-source and closed-source solutions.”
Sarkar realizes the enormous responsibility of enhancing investment criteria beyond financial metrics. Today, investments in top AI firms are motivated by the portfolio commitment to enhancing data privacy and tracking their carbon footprints. These practices, rooted in a broader industry ethos challenges the status quo.
She adds that the VC community finds itself at a critical crossroads and injecting capital into companies that perpetually train models may not be sustainable: “The industry is in a state of disruption, where anything can happen. We recognize the prevailing worry of the dominance of a few giants—Microsoft, Amazon, Google, OpenAI, Meta—accumulating vast resources and data. Generative AI’s success hinges on access to raw training data, a resource controlled by select organizations.”
Sarkar acknowledges the need for patience in this domain and observes the dual goals that pervade this space: “Let’s go to the market” and “inflate our valuation”—essential for sustaining the training of LLMs, in this increasingly capital-intensive space. The race for first-mover advantage unfolds, and we’re witnessing strategic moves to successfully raise.
“We are investing in this sector and are employing various strategies to predict potential winners. As an investor and one who instills the value of research rigor among our team of experts, I am excited about our involvement. While we adopt a risk-mitigated approach, we are backing capable founders with the right mindset, providing them with the necessary support, and becoming their trusted partners.
A Prominent Appointment to the Princess Grace Foundation of Monaco
Recently, Gayatri Sarkar received an official appointment as a crown patron for the prestigious Princess Grace Foundation. Overseen by Prince Albert of Monaco, the Princess Grace Foundation is dedicated to empowering underserved artists and potentially nurturing “future Grammy and Oscar winners.” She joins an esteemed group of invite-only crown patrons, including influential figures John Paulson, Leslie Odom Junior, Chuck Royce, Lady Tina Green, and director Jon M. Chu. In addition, Sarkar and Advaita Capital support Prince Albert’s commitment in addressing climate change through ocean technology, recognizing the significant R&D efforts towards blue-tech.
For Sarkar, she is honored with the appointment and is excited to explore how AI will disrupt various domains, particularly the film industry.
Sarkar is optimistic. She wants to set a new standard and reshape venture capital towards a more inclusive and sustainable future. Her dedication to deep tech investments comes with a measured approach that balances the societal impacts of a nascent but swift move towards advancements in AI. The current climate still paints a stark picture of systemic bias in technology and a slow emergence to right the VC ship, but she is undeterred and champions not just gender and racial diversity, but also a broader ethos of ethical and sustainable investing. She concludes,
“Our journey is ongoing; we must resist complacency and avoid prematurely declaring success. It’s not enough to merely observe surface-level developments; we must delve deeper. True accountability involves a commitment to meritocracy, recognizing that progress is a gradual process—one that demands patience and persistence.”
