Indian SaaS startups are actively investing in generative artificial intelligence (AI) technology to enhance their products and services. According to Aakrit Vaish, founder of Haptik AI, within the next decade, India will see the emergence of several software companies worth $100 million, adopting business models entirely different from those of American SaaS startups. He points out that the entire industry is awaiting disruption.
Image source note: The image was generated by AI, provided by the image licensing service Midjourney
AI as a Service (AIaaS) is becoming the new SaaS model. Existing SaaS companies are transforming into AI-centric entities. Matt Turck, a VC at First Mark Cap, says that both traditional and emerging SaaS companies will truly become AI-centric, with AIaaS becoming the new SaaS model.
Indian SaaS companies like Zoho, Freshworks, CleverTap, and Atlassian have already integrated generative AI features into their existing solutions. At the same time, many AI startups are developing new products based on these generative AI technologies. According to AIM data, there are approximately 60 AI startups in India leveraging generative AI to build products.
The Indian SaaS ecosystem is rapidly evolving, growing from 471 startups in 2016 to over 26,000 in 2022. Currently, 11 Indian SaaS companies have annual revenues exceeding $100 million. This elite group includes pioneers like Zoho, Druva, Icertis, and Freshworks, as well as emerging leaders like Innovaccer, Zenoti, and Postman. According to the latest report, the Indian SaaS industry is projected to reach $50 billion by 2030, with revenues of corporations and unicorn companies reaching $20-25 billion.
With the support of generative AI technology, Indian SaaS companies like Zoho, Freshworks, and Yellow.ai are delivering outstanding product performance. For example, Freshworks' GenAI platform Freddy Copilot saved a B2C retail client over $94,000 in its first year of implementation, achieving a 187% return on investment. LeadSquared uses LLMs provided by AWS Bedrock and customer-specific data to improve the quality of chatbot responses and optimize the user registration process. Clevertap's recently launched Clever.AI aims to enhance customer engagement and retention rates, accurately predicting business outcomes using CleverTap's proprietary TesseractDB™ data.
Generative AI technology has become a significant driver of growth for Indian SaaS companies, helping them build multimillion-dollar enterprises. By integrating generative AI technology into their existing applications, these companies will further promote the application and growth of AI. Indian SaaS companies and their international counterparts will continue to benefit from generative AI technology, helping enterprises to grow continuously.