Number of Indian startups valued over $500 million grows to 51, despite low number of AI companies

Despite venture capital funds creating opportunities for Indian artificial intelligence (AI) startups to enter the US market, securing initial clients in America remains a significant challenge. American companies typically require proven work experience before entering into agreements with new suppliers, which complicates startups' efforts to attract initial customers.

Venture firms such as Antler India and All In Capital have launched specialized programs to help local AI startups establish themselves in the United States. While some companies have already relocated their headquarters, found clients, and attracted subsequent funding, their expansion plans are complicated by high costs for local hiring and visa issues.

Details on Challenges

Ashish Bhatia, founder and CEO of India Accelerator, noted that winning the first few clients is one of the main difficulties for Indian startups aiming to enter the US market. He explained that firstly, buyers in the US require references, making the acquisition of the first two or three clients the most difficult. Secondly, requirements for security, regulatory compliance, and architecture are significantly higher. Thirdly, hiring sales and business development staff in the US is expensive, and visas for founders, who often move between countries, create additional obstacles.

Similarly, All In Capital identified key challenges as client access, achieving product-market fit in a new market, and building a local network. Antler India pointed out another barrier—the lack of a peer network. Founders entering a new market may not have reliable contacts for advice on hiring, pricing, legal structures, or pitching to investors.

To overcome these difficulties, venture funds provide support that goes beyond mere financing. They assist startups in finding potential clients, building local connections, and managing operational requirements.

Examples of Support Programs

Antler India launched the Embark program in May 2025. Over this period, more than 50 startups participated across four cohorts, including over 15 from India. Raghav Goyal, Investment Director at Antler India, reported that seventy-five percent of participants now have paying clients or active pilot projects in the US. More than half of them have secured subsequent rounds of funding. Nearly 50 percent have moved to the US, converting their holding company into an American structure and obtaining O-1 visas for founders. Most of them signed their first contract with an American client within three to four weeks of participating in Embark. Among the startups that relocated their headquarters to the US are Dodge, KuboCare, Nudge, and Aina.

Likewise, All In Capital launched the Golden Ticket program in January of this year to aid Indian startups in expanding into the American market. The program received over 750 applications in the first ten days and aimed to select 20–30 startups. The program's portfolio included Vasuki AI, which develops commodity hedging solutions; Tross, which creates a data layer and application programming interface (API) for AI agents in healthcare; and Mowito AI.

Among these companies, Mowito opened an office in Detroit, started pilot projects with American clients, and attracted additional funding from a Canadian investor. Kushal Bhagya, Co-founder and Partner at All In Capital, emphasized that early progress should be assessed based on the quality of client interactions and pilot projects, not just the number of users.

Recognizing the complexities of entering a new market, venture funds are increasingly offering operational support alongside capital. For instance, Antler India's Embark program facilitates introductions to American clients and provides practical assistance in early sales. It also collaborates with partners such as Deel, Rho, Alma, and Inkle, helping startups obtain visas and establish American entities.

Nevertheless, not all Indian startups aiming to expand into the US relocate their headquarters abroad. As Jasnoor Gill, Investment Director at Antler India, noted, 'Some startups keep their engineering and product teams in India while developing American teams, so relocation is more related to proximity to clients and capital than leaving India behind.'

However, the path of expansion was different for each company. Some firms participating in these programs decided to return. According to Gill, a couple of startups returned to India, usually because their core clients or teams were better served from that country. Nevertheless, the more common scenario is that founders develop higher ambitions regarding the US after spending time with American clients and investors.

Investment bank Goldman Sachs believes that India's artificial intelligence (AI) ecosystem has the potential to add between $50 and $100 billion to the country's market capitalization over the next two to five years. This growth is driven by an expected wave of initial public offerings (IPOs).

Goldman Sachs estimates that during this period, 25–50 percent of nearly 70 private AI companies in the mid-to-late development stage will go public. With a weighted average valuation approximately four times higher than the current assumed value, these companies will expand the representation of the Indian AI segment in public markets.

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In a joint note dated October 19, Timothy Mou, Co-Head of Asia Macro Research and Chief Strategist for Asia-Pacific Equities at Goldman Sachs, noted that listings could expand the universe of AI in India by bringing underrepresented segments of the AI value chain to public markets.

According to the Goldman Sachs report, funding for AI startups in India through private equity (PE) has tripled since 2024. Furthermore, the share of AI in the total volume of PE allocations has increased fourfold, reaching about one-fifth of all private capital directed to India. According to Stanford University's AI Index for 2026, India is now among the top six global leaders in attracting private funding for AI and among the top four in the number of new AI companies, contradicting the notion of India's peripheral position in global AI development.

Goldman Sachs identified 84 private companies as 'Private AI Contenders' with a combined current valuation of $55 billion. These companies account for almost 40 percent of all private capital raised in India's AI sector since 2025 and cover the entire value chain—from infrastructure providers and core AI developers to enterprises implementing AI across various industries.

The largest segment by value is 'upstream AI enablers.' These companies are involved in energy generation, power equipment, transmission, semiconductor supply chains, chip design, quantum computing, data centers, cloud services, and data management. Goldman Sachs values the current worth of this segment at $35 billion, making it the largest potential source for future AI-related listings.

'Downstream AI adopters' represent the most numerous group, comprising 42 companies—about half of the identified cohort—with a combined estimated valuation of $18 billion. These enterprises apply AI in areas such as computer vision, conversational AI, robotics, and edge computing, as well as in healthcare, financial services, enterprise software, defense, cybersecurity, and commerce.

The mid-tier segment, which includes core AI developers engaged in fundamental research, model training, and AI operations, remains relatively small. It comprises only seven companies with a combined estimated valuation of $2 billion.

Goldman Sachs forecasts that upstream AI enablers could account for 66 percent of potential listings, followed by downstream AI adopters at 31 percent, and core mid-tier AI drivers at 3 percent.

Although the projected increase is modest compared to the $670 billion universe of AI enabling technologies defined by the bank in a previous analysis, the broader significance lies in expanding India's AI ecosystem into the public market. Goldman Sachs notes that potential IPOs could introduce previously underrepresented entities, including data center operators, corporate AI service providers, cloud and data management systems, and AI specialists in healthcare and computer vision.

These companies are concentrated in established technological and business hubs, led by Bengaluru, Delhi-NCR, Mumbai, and Hyderabad, while Ahmedabad, Pune, and Chennai are beginning to emerge as additional centers of activity.

Anthropic, one of the companies whose artificial intelligence products have become popular worldwide alongside OpenAI, suffered significant financial losses in the first half of this year.

According to a report published by The Wall Street Journal on Tuesday, Anthropic recorded a loss exceeding 80 billion US dollars for the first half of this year. When converted into Indian currency, this amount is approximately 75,76888 crore rupees.

The company also reported that it may spend $750 billion next year to improve computing power.

The report indicates that last year the company's losses were about $13 billion, but there has been a sharp increase in losses during the current period. This jump is due to accounting expenses of $72 billion, which are directly related to the change in the value of financial instruments issued by Anthropic to raise funds, according to the company's IPO prospectus draft.

Anthropic's losses demonstrate how costly new technologies have become in the current situation. Currently, most companies provide their AI services for free.

Nevertheless, The Wall Street Journal also noted that Anthropic's revenue increased over the six-month period, reaching $16.3 billion. A year earlier, this revenue figure was about $1.1 billion.