India may not be as advanced as San Francisco in the field of artificial intelligence (AI), but it has a wealth of engineering talent, with many individuals transitioning into founders and builders of AI startups.
The AI startup landscape in India is reminiscent of the early days of Software as a Service (SaaS) in the country, with funding being relatively limited compared to the billions raised by AI startups in the U.S. and Europe. However, there are signs of venture capital being directed towards areas like generative AI, where home-grown talent is solving region-specific challenges and introducing innovative approaches to the same problems faced by their counterparts in developed countries.
Some Indian startups are focusing on integrating local language support into their AI models to meet the increasing demand from Indian consumers. Additionally, a few startups like Pepper Content and Pocket FM are leveraging AI to target markets beyond India, including the U.S.
Despite facing challenges, India's AI startup funding, including infrastructure and services, decreased by nearly 80% in 2023 to $113.4 million from $554.7 million in 2022. In contrast, AI startup funding in the U.S. grew by 211% to $16.2 billion in 2023 from $5.2 billion in 2022, with total investments reaching $13 billion in the U.S. Meanwhile, Indian AI startups received just $92 million in investments during the same period.
According to Dev Khare, a partner at Lightspeed Venture Partners India, the country offers promising opportunities for AI in consumer applications, such as content creation in Indic languages, virtual influencers, and AI-powered short videos and games.
Lightspeed India and Southeast Asia have invested over $150 million in AI in the last 18 months, including new investments and follow-ons in existing AI-enabled startups. Globally, the fund has invested more than $1 billion across over 70 AI companies during the same period.
Global and local investors are actively seeking AI startups in India, as the country provides portfolio diversification opportunities and maintains a favorable position amidst geopolitical tensions in key markets. Increasing data sovereignty concerns worldwide also contribute to the interest in local startups developing innovative solutions for India, the world's most populous country.
Top Indian AI Startups by Funding
Krutrim
Founder: Bhavish Aggarwal
Total funding raised: $50 million
Key investors: Matrix Partners India
Leading India's AI startup scene is Krutrim, founded by Bhavish Aggarwal, the co-founder of Ola. Krutrim, India's first unicorn AI startup, with a valuation of $1 billion on $50 million raised, focuses on building a large language model (LLM) based on Indian languages and English. Despite facing challenges with its AI chatbot, the startup continues to improve its AI model through regular updates.
Sarvam AI
Founders: Vivek Raghavan and Pratyush Kumar
Total funding raised: $41 million
Key investors: Lightspeed Venture Partners, Peak XV Partners and Khosla Ventures
Sarvam AI, co-founded by Vivek Raghavan and Pratyush Kumar, emerged from stealth mode in December, offering LLMs based on Indian languages. Partnering with Microsoft, the Bengaluru-based startup aims to provide full-stack generative AI solutions, enabling enterprises to develop GenAI apps and contribute to open source models and datasets.
Mad Street Den
Founders: Ashwini Asokan and Anand Chandrasekaran
Total funding raised: $57.4 million
Key investors: Avatar Growth Capital, Sequoia Capital and Alpha Wave Global
Based in Chennai, Mad Street Den specializes in computer vision AI solutions for various industries, including retail, finance, insurance, healthcare, and logistics. The startup, founded by Ashwini Asokan and Anand Chandrasekaran, aims to make AI ubiquitous globally.
Wysa
Founders: Jo Aggarwal and Ramakant Vempati
Total funding raised: $25 million
Key investors: HealthQuad, W Health, British International Investment and Google Assistant Fund
Wysa, a mental health tech startup, offers an emotionally intelligent therapist chatbot managed by mental health professionals. With over 6.5 million users across 95 countries, the Bengaluru-based startup raised $20 million in July 2022 and continues to expand its reach.
Neysa Networks
Founders: Sharad Sanghi and Anindya Das
Total funding raised: $20 million
Key investors: Matrix Partners India, Nexus Venture Partners and NTTVC
Headquartered in Mumbai, Neysa Networks, led by Sharad Sanghi, provides generative AI platforms and services to assist businesses in deploying AI and machine learning solutions. The startup's platforms focus on scalability, observability, and security for AI projects.
Emerging Indian AI Startups to Watch
Upliance AI
Founders: Mahek Mody and Mohit Sharma
Total funding raised: $5.5 million
Key investors: Khosla Ventures and Draper Associates
Upliance AI offers AI-powered solutions for home appliances, allowing users to create a variety of dishes at home. The Bengaluru-based startup plans to raise additional funding to strengthen its market presence.
Scribble Data
Founders: Venkata Pingali and Indrayudh Ghoshal
Total funding raised: $2.3 million
Key investor: Blume Ventures
Scribble Data provides domain-specific AI assistants to insurance companies in North America and Europe, helping them enhance their operational capacity. The startup, based in Bengaluru with a sales team in Toronto, aims to streamline and scale back-end processes for insurers.
Expertia AI
Founders: Kanishk Shukla and Akshay Gugnani
Total funding raised: $1.3 million
Key investors: Chiratae Ventures, Endiya Partners and Entrepreneur First
Expertia AI, located in Bengaluru, focuses on automating recruitment processes for businesses using AI, reducing hiring time to 24 hours. The startup is currently raising additional funds to support its growth.
OnFinance
Founders: Anuj Srivastava and Priyesh Srivastava
Total funding raised: $1.1 million
Key investors: Silverneedle Ventures, Indian Angel Network and LetsVenture
Based in Bengaluru, OnFinance offers AI solutions for banks and wealth management firms, assisting in equity research, compliance, and wealth advisory services.
Helium
Founders: Shray Arora and Sidharth Sahni
Total funding raised: $550,000
Key investor: Merak Ventures
Delhi-based Helium provides e-commerce brands with AI-powered storefronts and direct-to-consumer web stores, enhancing customer experiences and engagement.
Soket Labs
Founder: Abhishek Upperwal
Total funding raised: $140,000
Soket Labs, with locations in Bengaluru and Gurugram, focuses on AI research and has developed the Pragna-1B multilingual LLM through its GenAI Studio. The startup plans to raise $7 million in a seed round in the near future.
Kissan AI
Founders: Pratik Desai
Kissan AI, based in Surat with an office in the Bay Area, specializes in serving the agriculture industry with its GenAI platform AgriCopilot and domain-specific Agri LLMs. The bootstrapped startup is looking to raise funds to accelerate its growth.
Shorthills AI
Founders: Pawan Prabhat and Paramdeep Singh
Founded by Pawan Prabhat and Paramdeep Singh in Gurugram, Shorthills AI offers custom AI tools for enterprises, counting NHS and PwC among its early customers in the U.S. and India.
