Minuscule AI startup raises $41 million to tap India growth

A generative artificial intelligence startup targeting the Indian market raised $41 million in fresh funding, the largest such round by an early-stage AI contender in the country.

Sarvam AI is building large language models targeted at unique uses in Indian languages at price points that the country’s 1.4 billion people can afford. The Series A funding round was led by Lightspeed Venture Partners, and participants included Silicon Valley billionaire Vinod Khosla’s Khosla Ventures and Peak XV Partners, formerly Sequoia Capital India & Southeast Asia, Sarvam said Thursday.

The Bangalore-based startup, until recently in stealth mode, was co-founded by Vivek Raghavan and Pratyush Kumar. It has ambitious plans to build open source foundational AI systems as well as tools for creating apps for the meager compute infrastructure available to developers in India. The startup has a total of 18 employees and is just opening an office in the city.

"What we are showing is that you can build large language models with limited resources,” Raghavan said in a phone interview. "We are building at a smaller scale and demonstrating that these can be extremely cost and energy efficient so they can be accessed by everyone."

Large language models, like OpenAI’s GPT-4 and Meta Platforms Inc.’s Llama, are powerful AI systems that understand by learning from vast amounts of diverse data from the internet and elsewhere to summarize, translate, and create text, audio and video for a wide range of applications. The rivalry to develop ever-more sophisticated models is heating up in Silicon Valley and such efforts have attracted billions of dollars in investments.