AI Startups To Watch: 5 Startups That Caught Our Eye In May
by Ankush Das · Inc42SUMMARY
- The eighth edition of Inc42’s AI Startups To Watch, powered by Peak XV, highlights emerging Indian AI startups building across enterprise finance automation, cybersecurity, conversational lending, agentic workflow infrastructure, and AI-native customer engagement systems
- As India’s AI ecosystem matures amid rising compute costs and growing infrastructure investments, founders are increasingly focusing on operational AI systems designed to automate finance, enterprise execution, and customer interactions
- From AI-powered treasury orchestration and enterprise workflow agents to unified customer intelligence platforms, these startups are positioning themselves at the intersection of AI infrastructure and real-world business operations
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The AI narrative in India is currently dominated by scale, with Google breaking ground on its $15 Bn AI Hub in Visakhapatnam and Maharashtra’s landmark AI Policy 2026.
Yet, beneath these massive infrastructure bets and policy shifts lay a more fundamental tension. Critics continued to flag the “hidden economics” of compute, while the quiet shuttering of many Indian AI startups brings to the fore the sustainability questions. Risks posed by Anthropic’s Mythos model are also keeping Indian regulators and banks on edge.
Yet, not everything is doom and gloom. AI startups continued to raise big bucks, while AI giant Sarvam announced a partnership with Pixxel to power India’s first orbital data centre. Simultaneously, a clutch of AI startups is in advanced talks with the defence ministry to establish a ₹300 Cr centre of excellence to develop indigenous AI technologies for national security.
India’s AI momentum is no longer in question. What, however, remains uncertain is who captures the value. As infrastructure scales and startups battle rising compute costs, the next phase of India’s AI story will likely be defined by sustainable businesses built on top of them.