Investments in Indian start-ups sizzle, but the market may soon cool

NEW DELHI — In a sprawling wholesale market of timber, glass and marble, businessman Amit Gupta supervises workers loading sheets of glass on trucks for builders across India — his family business for five decades.

As plumes of sawdust float up, Gupta says he wants to play a role in the new economy. For the last year, he's been reading newspaper stories about the booming start-up culture, with millions flowing in from venture capitalists and nerdy graduates of India's tech universities becoming millionaires overnight.

About $6.5 billion has been invested into start-ups this year, up from $2.2 billion last year, according to the National Assn. of Software and...