By Aditya Agarwal 
India’s AI startup story is entering a new phase.
Investors are no longer looking only at consumer-facing AI applications.
Instead, capital is moving across the entire AI stack.
That includes infrastructure, deeptech, AI services, foundation technology and specialised applications.
On September 17, AI-focused venture firm Activate said early-stage AI deal activity was at an all-time high. The firm’s first close of a ₹1,000 crore AI-focused fund adds another signal to the growing investor interest. (Moneycontrol)
For Indian entrepreneurs, the message is important.
There may be more than one way to build an AI company.
The AI Founder Wave Is Splitting Into Two Groups
One interesting trend is the emergence of different founder profiles.
According to Activate founder Aakrit Vaish, investors are seeing very early-stage founders building deeptech and AI infrastructure.
At the same time, experienced corporate executives are leaving established companies to build AI-native businesses. (Moneycontrol)
That creates two very different startup journeys.
One founder may begin with technical research.
Another may start with years of industry knowledge.
However, both can use AI to create new products.
Domain Expertise Is Becoming a Startup Advantage
AI tools are becoming increasingly accessible.
Therefore, simply having access to AI is no longer enough.
Founders need to understand where the technology can create real value.
An experienced finance executive may understand a banking workflow that outsiders miss.
Similarly, an enterprise technology executive may know where companies lose time and money.
Consequently, domain expertise can become a powerful starting point for AI entrepreneurship.
The founder understands the problem.
AI provides the new toolkit.
Investors Are Looking Across the AI Stack
The funding opportunity is also becoming broader.
AI infrastructure requires capital.
Deeptech requires capital.
AI services require customers.
Application companies need distribution.
Therefore, different parts of the ecosystem can attract different investors.
This matters because India’s AI market does not have to depend on one type of company.
Instead, several categories can develop simultaneously.
The Economics Are Changing
Building software has traditionally required teams of engineers, designers and product specialists.
AI can reduce some of those costs.
A smaller founding team can now prototype faster.
Moreover, founders can automate research, documentation, coding and customer operations.
As a result, early-stage companies may be able to test ideas with less capital.
However, lower development costs can also increase competition.
More founders can build.
More products can enter the market.
Therefore, distribution and customer relationships become increasingly important.
Why Deeptech Is Different
AI infrastructure and deeptech businesses have different requirements.
They may need specialised talent.
They can also require expensive computing infrastructure.
Furthermore, some products have longer development cycles.
That means investors must evaluate technical risk alongside market potential.
Still, these companies can create important strategic capabilities.
India’s opportunity is not limited to software applications.
The country can also build technology underneath the AI ecosystem.
Corporate Executives Are Becoming Founders
Another important trend is experienced professionals leaving large companies.
People who spent years inside firms such as consulting, technology and professional-services companies can bring valuable knowledge with them.
They understand enterprise problems.
They also understand how large organisations purchase technology.
Consequently, they may be able to build AI services around problems they have already experienced.
This could create a new generation of AI-native enterprise companies.
The New Startup Playbook
The traditional startup formula often began with a team, a product and a fundraising plan.
The AI-native version can look different.
First, a founder identifies a valuable problem.
Next, AI tools help build a prototype.
Then, the founder tests the product with customers.
Finally, funding follows evidence of demand.
That sequence can reduce wasted capital.
At the same time, it puts greater pressure on founders to move quickly.
What Founders Should Watch
The opportunity is large, but the market is becoming more competitive.
Therefore, founders should focus on problems rather than simply technology.
A strong AI startup needs a clear customer.
It needs a meaningful workflow.
It also needs a reason customers cannot easily replace it.
Most importantly, the company needs a path toward sustainable economics.
India’s next AI wave may not come from one giant company.
Instead, it could come from hundreds of founders building specialised businesses across the AI stack.
Tags: India AI Startups, AI Entrepreneurship, AI Funding India, Deeptech Startups, AI Founders, Venture Capital India, Startup Ecosystem 2026
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Nayra Roy