At a time when foreign investors are looking away from India to back ambitious AI bets elsewhere, Dutch investment company Prosus is taking baby steps to invest in homegrown startups that are leveraging AI.
Prosus has backed three AI startups so far this year. In July, it co-led a $4.17 million pre-Series A funding round in Indore-based edtech startup Arivihan, marking the firm’s first e-tech investment after it wrote off its ~$500 million bet in Byju’s.
Arivihan develops AI-powered and teacher-free mobile learning apps that are designed for students in smaller Indian cities and rural areas.
A month later, Prosus co-led a $2.5 million pre-seed round in Bengaluru-based CodeKarma. The company creates AI tools to help improve developer productivity.
In May, the firm had also invested an undisclosed amount in Deccan AI—a startup that specialises in creating high-quality datasets for AI model training and evaluation.
These investments have a few things in common, which could form Prosus’ thesis on backing Indian AI startups. The company, which built its initial Indian portfolio by writing large cheques to companies like Flipkart and Swiggy, has in recent years also begun writing smaller cheques, giving the company a taste of AI development in the country without having too much skin in the game.
.thumbnailWrapper{
width:6.62rem !important;
}
.alsoReadTitleImage{
min-width: 81px !important;
min-height: 81px !important;
}
.alsoReadMainTitleText{
font-size: 14px !important;
line-height: 20px !important;
}
.alsoReadHeadText{
font-size: 24px !important;
line-height: 20px !important;
}
}
India has taken a backseat in the global AI race, struggling to compete with large language models developed in the US and China. Prosus seems to be on the hunt for AI companies that are catering to specific use cases and can scale.
“We’re looking at multiple sub-segments within AI. We’re looking at consumer AI opportunities, where we did something in the edtech AI space. We’re also looking at sort of B2B AI opportunities. I think because this space is so nascent, we don’t want to then box ourselves into that,” Gaurav Kothari, Principal at Prosus Ventures, told YourStory.
The message is clear: Prosus is not looking to limit itself into backing a single AI use case, instead it is keeping an open mind toward Indian AI startups. The firm will then form its AI investment thesis based on how its bets pan out in the market.
“For every segment, we build our own thesis and then try to see if there’s a strong AI use case or not, but right now we are not just focusing on ‘we’ll do only X in AI or Y in AI’. The idea is to sort of have a wider approach and then sort of build the thesis at a company level like why would it work in India or not work in India? This is how we are thinking about it,” Kothari added.
Edited by Affirunisa Kankudti
