Indian AI Startup Sarvam Secures $41M in Funding at Just Five Months Old

Sarvam AI has emerged from stealth mode, securing $41 million in funding as the five-month-old Indian startup accelerates its mission to develop a full suite of generative AI solutions in the world's most populous country.

The $41 million financing includes contributions from seed and Series A rounds, with Lightspeed leading the Series A and co-leading the seed round alongside Peak XV Partners. Other prominent investors, including Peak XV and Khosla Ventures, also participated in the Series A investment.

Based in Bengaluru, Sarvam AI is focused on building large language models (LLMs) that support Indian languages. Founder Vivek Raghavan shared that the startup is creating a platform enabling businesses to leverage LLMs for various applications—ranging from app development to deployment on major channels, monitoring logs, and performing custom evaluations.

Employing around 18 staff members, Sarvam AI is prioritizing voice as the primary interface for its LLMs, tailored specifically to meet the unique needs of the Indian market. "This necessitates adjustments to the architecture of existing open models, training them in novel ways to accommodate new languages," Raghavan explained. "The result is models that are more efficient in understanding and generating Indian languages than current options."

Founded by Raghavan and Pratyush Kumar, who both previously worked at Nandan Nilekani-backed AI4Bharat at IIT Madras, Sarvam AI was established just five months ago. Raghavan also brings extensive experience, having spent over a decade at UIDAI, the organization responsible for the widely-used Aadhaar identity system in India. "I've witnessed the immense potential of innovating at foundational levels and deploying those innovations at population scale," he noted. "India has shown it can approach technology in a unique way, and with generative AI, we have a chance to reshape how this technology enhances lives."

The startup plans to release its first model within the coming weeks. This investment comes at a pivotal moment when global investors are eager to identify and support breakthroughs in AI, anticipating that advancements will enhance efficiency across numerous industries and yield substantial returns for leading startups.

Although India is home to one of the largest startup ecosystems, it has yet to significantly impact the rapidly evolving AI landscape, lacking homegrown contenders to rival major players like OpenAI's ChatGPT, Anthropic, or Google’s Bard. Recently, Indian giant Reliance announced a partnership with Nvidia to develop a large language model focused on training with India's diverse languages.

"We observe many countries launching sovereign initiatives to build generative AI models due to their strategic significance. Companies like Sarvam AI are crucial for developing deep expertise in creating AI tailored for India," remarked Vinod Khosla, founder of Khosla Ventures, the first institutional investor in OpenAI, who turned a $50 million investment into a $5 billion return.

Hemant Mohapatra, a partner at Lightspeed, noted Sarvam AI’s "unique approach" that combines model innovation with application development to create "population-scale" solutions for India. "Lightspeed will be a close partner, offering our extensive capital resources and insights from our global network," he added.

According to sources familiar with the situation, Peak XV and Lightspeed India completed their investment in Sarvam AI’s seed funding round in less than a week. "The Sarvam AI team, led by Vivek and Pratyush, represents one of the highest-caliber AI teams we've seen emerge from India,” stated Harshjit Sethi, managing director of Peak XV. “Vivek’s proficiency in designing large-scale systems, combined with Pratyush’s AI domain expertise, uniquely positions them to build applications that can be adopted at a population level. For AI to gain substantial traction in India, we not only need distinctively Indian use cases but also affordable delivery methods, and we believe the Sarvam team is well-equipped to achieve this.”