• Top VCs like Peak XV, Accel, and Elevation Capital are backing India’s new wave of AI-first startups redefining traditional IT services.
• These startups embed AI at the core transforming app development, infra management, and software testing with intelligent automation.
• With rising founder interest and global scalability potential, investors see AI-native ventures as the next big tech disruption from India.

A fresh wave of AI-first startups is attracting intense attention from top venture capital firms in India, with investors looking to fund businesses that are redefining conventional IT services using artificial intelligence. Major players such as Peak XV Partners, Stellaris Venture Partners, Accel, and Elevation Capital are actively scouting for early-stage startups that are building core products and solutions with AI at their foundation, signaling a shift in investment strategy toward long-term bets on emerging technologies.

These companies are looking beyond cosmetic AI implementations and instead investing in ventures in which AI is the inspiration for innovation. Application development, infrastructure management, software testing, and customer support are being revolutionized as startups harness AI to simplify difficult tasks, enhance productivity, and lower operational expenses. Investors are optimistic that this next generation of AI-native companies can shake up traditional IT paradigms and redefine the way services get delivered at scale.

Interest in AI-first businesses arrives at a time of wider technology investing across the globe. With generative AI and large language models evolving rapidly, startups have increasingly effective tools to create differentiated products. In contrast to previous generations of technology businesses that added AI as a feature on top of platforms, these startups are integrating AI into the core of their products, developing more intelligent and adaptive systems.

Venture capitalists are also seeing an upswing in entrepreneurial interest in this area as more veteran founders are opting to start businesses around core AI capabilities. Some of these startups are addressing enterprise-class challenges like automating code generation, automating IT workflows, and improving security using real-time AI decision-making.

Though the industry is yet to mature, investors are looking for early winners, especially those who can scale up at a global level and create defensible moats. With AI becoming a core part of enterprise workflows, the prevailing funding momentum indicates high levels of confidence in India's ability to create category-defining AI-first businesses. Investors are in a race to bet early on what could be the next wave of technology leaders transforming IT services with the help of artificial intelligence.