MUMBAI: The rapid evolution of AI and the emergence of 'real-world' use cases for the technology is fueling investor appetite for AI startups, even as broader technology funding remains sluggish. Fund managers are chasing Indian players in this space.
Japan's SoftBank announced last week that its chief financial officer (CFO) Yoshimitsu Goto said, “We are an investment company, and we want to lead the AI era in various aspects,'' and the technology funding environment will be strong in the coming years. may determine the direction of
Singapore-based venture capital firm Antler, which recently closed a $75 million India fund to back pre-seed stage startups, has made eight AI investments (both India-based and Indian-origin) through the fund. (both of which are led by the founders of). None of them have been announced yet.
Indian AI startups have raised $91.7 million in funding so far this year, compared to $29.6 million in the same period last year, according to market research firm Tracxn. “His AI has overwritten the pitch numbers we have had in the last 12 months,” Antler partner Rajiv Srivatsa told TOI.
While not many companies in India are building basic AI models yet (such as OpenAI's GPT-4 and Google's Gemini), companies like Bengaluru-based Sarvam AI and Bhavish Aggarwal's Krutrim AI are has successfully built and raised millions of dollars from investors. Last year, Salvam raised $41 million in early-stage funding from investors including Lightspeed and Peak XV Partners, valuing Kurtrim at $1 billion. “The foundational model requires more capital. For apps, it's becoming harder to differentiate given the pace of innovation in the core model,” Srivatsa said.
Instead, several local startups are building AI-centric products and applications for enterprises and consumer-centric businesses. For example, India and US-based startup Attentive recently raised $7 million in funding led by Vertex Ventures Southeast Asia and India to build an AI-based sales automation platform for the outdoor services and construction industries. Masu.
“AI is no longer just a hype. We are already seeing real-world use cases for AI. Today, AI is much more powerful, processing data that would otherwise take years. Generate in minutes. Previously, AI processed data generated by humans and business processes,” says RTP Global's Asia investment team, a venture capital firm that evaluates AI startups in India. said partner Nishit Garg.
RTP Global has invested in India and US-based AI security startup SydeLabs, led by an Indian founder. Garg further added, “Every company needs to use AI in some way, otherwise AI will become obsolete,” adding that investor interest in companies building AI solutions is increasing. He emphasized that
AI touches on several spaces. In the fast fashion space, companies are using GenAI to develop new styles tailored to consumer requirements. “What was once done by maybe 10 people can now be done by two people and one AI application. Use cases like this make business processes smoother and reduce business costs. will be reduced,” the investor said. Funding for generative AI surged to $250 million in 2023 from $15 million in 2022, even as investment in broader software and SaaS declined, according to a Bain report. .
Early-stage accelerator fund 100Unicorns has launched a $200 million fund, of which at least $20 million will be earmarked for AI and deep tech startups, according to co-founder Apoorva Ranjan Sharma. Stated. “We have the best AI and IT brain in India. Why can't he create something better than ChatGPT?” Sharma said.
Japan's SoftBank announced last week that its chief financial officer (CFO) Yoshimitsu Goto said, “We are an investment company, and we want to lead the AI era in various aspects,'' and the technology funding environment will be strong in the coming years. may determine the direction of
Expanding
Singapore-based venture capital firm Antler, which recently closed a $75 million India fund to back pre-seed stage startups, has made eight AI investments (both India-based and Indian-origin) through the fund. (both of which are led by the founders of). None of them have been announced yet.
Indian AI startups have raised $91.7 million in funding so far this year, compared to $29.6 million in the same period last year, according to market research firm Tracxn. “His AI has overwritten the pitch numbers we have had in the last 12 months,” Antler partner Rajiv Srivatsa told TOI.
While not many companies in India are building basic AI models yet (such as OpenAI's GPT-4 and Google's Gemini), companies like Bengaluru-based Sarvam AI and Bhavish Aggarwal's Krutrim AI are has successfully built and raised millions of dollars from investors. Last year, Salvam raised $41 million in early-stage funding from investors including Lightspeed and Peak XV Partners, valuing Kurtrim at $1 billion. “The foundational model requires more capital. For apps, it's becoming harder to differentiate given the pace of innovation in the core model,” Srivatsa said.
Instead, several local startups are building AI-centric products and applications for enterprises and consumer-centric businesses. For example, India and US-based startup Attentive recently raised $7 million in funding led by Vertex Ventures Southeast Asia and India to build an AI-based sales automation platform for the outdoor services and construction industries. Masu.
“AI is no longer just a hype. We are already seeing real-world use cases for AI. Today, AI is much more powerful, processing data that would otherwise take years. Generate in minutes. Previously, AI processed data generated by humans and business processes,” says RTP Global's Asia investment team, a venture capital firm that evaluates AI startups in India. said partner Nishit Garg.
RTP Global has invested in India and US-based AI security startup SydeLabs, led by an Indian founder. Garg further added, “Every company needs to use AI in some way, otherwise AI will become obsolete,” adding that investor interest in companies building AI solutions is increasing. He emphasized that
AI touches on several spaces. In the fast fashion space, companies are using GenAI to develop new styles tailored to consumer requirements. “What was once done by maybe 10 people can now be done by two people and one AI application. Use cases like this make business processes smoother and reduce business costs. will be reduced,” the investor said. Funding for generative AI surged to $250 million in 2023 from $15 million in 2022, even as investment in broader software and SaaS declined, according to a Bain report. .
Early-stage accelerator fund 100Unicorns has launched a $200 million fund, of which at least $20 million will be earmarked for AI and deep tech startups, according to co-founder Apoorva Ranjan Sharma. Stated. “We have the best AI and IT brain in India. Why can't he create something better than ChatGPT?” Sharma said.
