Sources: 
India's AI startup ecosystem is grappling with a significant trust crisis, according to investor Kirani, who primarily funds AI ventures. Despite a surge in funding and rapid revenue growth, Indian AI startups struggle to gain the confidence of domestic enterprises, which often prefer Western platforms for validation.
Kirani illustrated this challenge with a striking example:
"I can’t force Swiggy, our own company (portfolio startup), to use an Indian platform unless it’s already being used in the Bay Area." This highlights a prevailing mindset where Indian companies look westward, underscoring a lack of brand equity within the local AI ecosystem.
The funding landscape is improving, with AI-first companies commanding valuation premiums of
3–5 times higher than traditional SaaS firms at similar stages, reflecting rapid revenue growth and investor interest. However, Kirani warns that without building strong brand credibility, Indian AI startups will remain overshadowed by global giants.
This credibility gap not only affects market adoption but also limits the startups' ability to scale domestically. Kirani's insights point to a critical need for Indian AI firms to enhance their brand presence and trustworthiness to compete effectively on both local and global stages.
"Without strong brand credibility, India’s AI startups will always play second fiddle to global giants," Kirani emphasized, signaling a call to action for the ecosystem to bridge this trust divide.
As the AI sector in India grows, addressing this brand credibility gap will be essential for startups aiming to lead innovation and capture market share at home and abroad.
Sources: Indian AI startups face a trust deficit as domestic enterprises prefer Western validation, warns investor Kirani. Despite rising funding and rapid revenue growth, a brand credibility gap persists, limiting Indian AI firms' ability to compete with global giants and gain instinctive confidence in the local market.
