While India is far from the uncanny valley of San Francisco, it has a tremendous pool of talented engineers, and some of these people are jumping on the bandwagon and becoming founders and builders of AI startups.
The story of the AI startup ecosystem in India today is reminiscent of the early days of SaaS in the country: funding is limited—especially compared to the billions raised by AI startups in the US and Europe. But in areas like generative AI, we’re seeing signs of where the venture capital is going. It’s going to homegrown talent solving problems specific to their part of the world and developing new approaches to the same challenges faced by their counterparts in developed markets.
Some Indian startups are looking to integrate local language support into their AI models to meet the growing demand of Indian consumers. And some Indian startups like Pepper Content and Pocket FM are also using AI to create use cases for markets outside India and to tap into the US market.
But that doesn’t mean it’s been easy. In India, funding for AI startups — including those working on infrastructure and services — fell nearly 80% in 2023 to $113.4 million from $554.7 million in 2022, according to Tracxn data shared with TechCrunch. In contrast, funding for AI startups in the US rose about 211% last year to $16.2 billion from $5.2 billion in 2022. To date, investment in AI startups in the US has reached a whopping $13 billion. During the same period, only $92 million was invested in Indian AI startups.
Dev Khare, partner at Lightspeed Venture Partners India, told TechCrunch that India offers some good opportunities for AI in consumer applications, be it creating content in Indian languages, offering virtual influencers or creating short videos and games using AI.
“A lot of the SaaS market over the last decade has focused on established markets and tried to replicate them at a lower cost and with better support. That very viable market has produced some great results in India. But you can’t do that in an emerging market like AI or native AI. You have to take a risk and say, ‘This is what the world will look like in a few years. That market doesn’t exist today, but I bet it does. I’m going to build on that.’ That’s a little newer DNA for India. We’ve seen that before,” he said.
In the last 18 months, Lightspeed India and SEA has invested over $150 million in AI, including new investments and follow-on investments in existing AI startups. Globally, the fund has invested more than $1 billion in over 70 AI companies in the same period.
Global and local investors are actively looking for AI startups in India as the country helps them diversify their portfolios and is in a better position amid ongoing geopolitical conflicts in key markets. Growing concerns about data sovereignty across countries is also a reason to look for local startups developing promising solutions for the world’s most populous country.
Indian AI startups that have raised the most money
Krutrim
Founder: Bhavish Aggarwal
Total funding raised: 50 million US dollars
Important investors: Matrix Partners India
Led by Ola founder Bhavish Aggarwal, Krutrim (Hindi with Sanskrit roots, meaning “artificial”) is India’s first unicorn AI startup, valued at $1 billion with just $50 million in capital. Founded in Bengaluru in December 2023, Krutrim is developing a large language model (LLM) based on Indian languages and English. Earlier this year, it unveiled an AI chatbot that (not unlike its Western counterparts) faced criticism for inaccurate results during its public beta release. The startup claims its AI model is being improved through regular updates.
Sarvam AI
Founder: Vivek Raghavan and Pratyush Kumar
Total funding raised: 41 million US dollars
Important investors: Lightspeed Venture Partners, Peak XV Partners and Khosla Ventures
Sarvam AI (Telugu for “everything”) is India’s other high-profile startup working on LLMs based on Indian languages. The startup was co-founded by Vivek Raghavan and Pratyush Kumar, both of whom had previously worked with tech veteran Nandan Nilekani on IIT Madras’ AI4Bharat project. The Bengaluru-based startup emerged from obscurity in December and aims to offer full-stack generative AI offerings, including a platform that lets enterprises develop GenAI apps based on Sarvam’s LLM and contribute to open-source models and datasets. In February, Sarvam AI partnered with Microsoft to launch language-based AI tools and bring its Indian language LLM to Azure.
Mad Street Den
Founder: Ashwini Asokan and Anand Chandrasekaran
Total funding raised: 57.4 million US dollars
Important investors: Avatar Growth Capital, Sequoia Capital and Alpha Wave Global
Computer vision startup Mad Street Den develops AI solutions for enterprise clients. Co-founded in 2016 by neuroscientist-designer duo Ashwini Asokan and Anand Chandrasekaran, the Chennai-based startup initially launched its vision technology for retail but expanded it to vertical markets such as finance, insurance, healthcare and logistics. Its larger vision goes beyond its home market, with its mission to “make people around the world AI natives.”
Wysa
Founder: Jo Aggarwal and Ramakant Vempati
Total funding raised: 25 million US dollars
Important investors: HealthQuad, W Health, British International Investment and Google Assistant Fund
Wysa is a mental health technology startup that uses AI to offer an “emotionally intelligent” therapist chatbot to help users talk about their feelings. The chatbot is managed by Wysa’s mental health experts and is used by over 6.5 million people in more than 95 countries and across age groups. The Bengaluru-based startup, which also has operations in Boston and London, raised $20 million in July 2022. It was co-founded in 2016 by Jo Aggarwal and her husband Ramakant Vempati after Aggarwal fell into a severe depression.
Neysa Networks
Founder: Sharad Sanghi and Anindya Das
Total funding raised: 20 million US dollars
Important investors: Matrix Partners India, Nexus Venture Partners and NTTVC
Mumbai-based Neysa Networks is led by veteran tech entrepreneur Sharad Sanghi, who previously founded cloud and data company Netmagic Solutions. It offers enterprises a variety of generative AI platforms and services to help them deploy AI and machine learning. The startup’s Nebula platform is used to scale AI projects using on-demand GPU infrastructure and train and infer AI models in the cloud. The company’s Palvera platform offers multi-vendor and multi-input observability and enables users to preemptively identify issues using a unified data lake and pre-existing telemetry datasets. The Aegis platform focuses on AI/ML security.
Here are some emerging Indian AI startups to keep an eye on
Upliance AI
Founder: Mahek Mody and Mohit Sharma
Total funding raised: 5.5 million US dollars
Important investors: Khosla Ventures and Draper Associates
Upliance AI is bringing AI into home appliances to help people cook over 500 new dishes at home. The Bengaluru-based startup plans to raise $10-15 million early next year to strengthen its market presence.
Scribble data
Founder: Venkata Pingali and Indrayudh Ghoshal
Total funding raised: 2.3 million US dollars
Most important investor: Blume Ventures
Scribble Data provides domain-specific AI assistants to major North American and European insurers to help them scale their back-end business capabilities. The company is headquartered in Bengaluru with a sales team in Toronto.
Expertia AI
Founder: Kanishk Shukla and Akshay Gugnani
Total funding raised: 1.3 million US dollars
Important investors: Chiratae Ventures, Endiya Partners and Entrepreneur First
Bengaluru-based Expertia AI helps companies automate their recruitment using AI and reduces the time to hire to 24 hours. It automates sourcing, screening, outreach, engagement, assessment, interviewing and scheduling using proprietary deep learning algorithms. The startup is currently raising $3 million from the lead investor, with participation from existing investors.
OnFinance
Founder: Anuj Srivastava and Priyesh Srivastava
Total funding raised: 1.1 million US dollars
Important investors: Silverneedle Ventures, Indian Angel Network and LetsVenture
Bengaluru-based OnFinance supports banks and asset management firms with its AI co-pilots working in areas ranging from equity analysis to compliance to wealth advisory.
helium
Founder: Shray Arora and Sidharth Sahni
Total funding raised: 550,000 US dollars
Most important investor: Merak Ventures
Delhi-based Helium helps e-commerce brands build direct-to-consumer web stores with AI and reactive headless storefronts.
Socket Labs
Founder: Abhishek Upperwal
Total funding raised: 140,000 US dollars
Bengaluru and Gurugram-based Soket Labs is an AI research company that has developed the open-source multi-language LLM Pragna-1B through its in-house GenAI Studio. It plans to raise $7 million in a seed round in two to three months.
Kissan AI
Founder: Pratik Desai
Based in Surat with an expanded office in the Bay Area, KissanAI serves agriculture and allied sectors using its GenAI platform AgriCopilot and a family of subject-specific agri-LLMs, Dhenu. The startup is currently self-funded and supported by the founder’s family and friends, but plans to raise $3-4 million in a Seed to Series A round.
Shorthills AI
Founder: Pawan Prabhat and Paramdeep Singh
Gurugram-based Shorthills AI was founded in June 2018 by Pawan Prabhat and Paramdeep Singh. The pair had previously founded accounting training platform EduPristine. The bootstrapped startup develops bespoke AI tools for enterprises and counts NHS and PwC among its first 12 clients in the US and India.
