Rise of Cloud AI in India 2024 - Bessemer Venture Partners

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Rise of Cloud AI
in India 2024
Aparna Chaganty
Investor
Divyam Sharma
Investor
Vatsalya Tandon
Investor
Kshiteej Prasad
In...

INDIA SAAS MARKET SIZE
Source: Venture Intelligence, Industry Reports, BVP analysis
India’s SaaS market continues to infle...

Source: Private Circle, BVP analysis
India SaaS centaurs and unicorns are set to bring in $20 to
$25 billion in revenue by...

0.75
1.5 1.75
4.95
6.18
0.9
0.53
127
236
300
530
453
145
49
0
100
200
300
400
500
600
0
1
2
3
4
5
6
7
8
2018 2019 2020 202...

Reemergence of India SaaS unicorns
in 2024 led by AI startups
Unicorn year 2022
9
#New unicorns
2018
2
2019
2
2020
6
2021
...

A RARE BREED
$100M ARR
with ARR defined as annual
recurring or subscription
revenue
Three new Centaurs
have emerged in 202...

Source: BVP NASDAQ Emerging Cloud Index and Bessemer Research
In the AI era, Public Cloud returns to “historical norms”
3....

Even in tough macroeconomic conditions, growth gets a
premium over profitability
Growth Rate + FCF Margin = Rule of X
x Mu...

>$100M ~2 ~9 ~11 ~16
$50-100M 1-2 ~12 ~16 ~22
$20-50M 2-4 ~20 ~25 ~35
$10-20M 8-10 ~30 ~35 45-50
$5-10M 15+ 50+ 60+ ~100
$...

Our rapid growth is driven by a uniquely innovative, composite
product that establishes us as the modern leader in the PSA...

AI has been an undeniable catalyst for Indian SaaS. It's
accelerated our ability to move swiftly and decisively in the
mar...

The cornerstone of our growth lies in the unwavering dedication of a
strong and driven team, committed to achieving realis...

Source: BVP Interviews
Baskar Subramanian, Srinivasan KA, Srividhya Srinivasan
Founders of Amagi
At Amagi, our dream was t...

Rise of Cloud AI in India 2024— Five key trends
The line between software and
services is blurring with the
rise of AI-ena...

2024 Trend – 1
India SaaS is transitioning
to IndAI SaaS

Venture dollars in AI continue to rise
78
64
125
115
140
175
20
120
2018 2019 2020 2021 2022 2023
$M
$M
Total Funding in
U...

Source: BVP Survey
Bessemer survey of Indian startups shows that 53% of them
categorize themselves as AI-enabled SaaS
A wh...

Leena AI case study:
Broken workflows cost enterprises millions
Emma Wilson
Top Sales Rep
Core tools:
Salesforce, Email,
M...

Leena AI Knowledge Agent reads through all
enterprise knowledge and finds the right case
study in manufacturing domain in ...

ENTERPRISE
HORIZONTAL
ENTERPRISE
VERTICAL
INFRA
/
FOUNDATION
AI Native AI Enabled
AI-enabled SaaS opportunity will dwarf t...

Monish Darda, Co-Founder & CTO, Icertis Source: BVP Interviews
“
India's young English-speaking population and rapidly gro...

Arundhati Bhattacharya
Chairperson & CEO, Salesforce India
Source: BVP Interviews
“
A recent report by NASSCOM predicts th...

2024 TREND – 2
The line between software
and services is blurring
with the rise of
AI-enabled services

10%
12%
14%
16%
18%
20%
22%
24%
26%
28%
30%
-
50
100
150
200
250
300
350
400
450
500
2020 2024 2030
Global Market India Co...

Sources: BVP Desk, NASSCOM, Bain, PwC, Grand View Research, Smart Sheet, TaskUs
India: The hub of professional services wi...

Source: BVP Desk; Regulations Handbooks; Gartner; KPMG
AI will augment human expertise where trust is fundamental
AI will ...

The rise of new age service firms: Efficient, accurate, human
Source: Public Company Reports; BVP Desk
1.
Software-equival...

Human Writer (Creator) Human Editor (Quality Control)
+ = 30%
Gross Margin
Business
Human Writer (Creator) AI Editor (Qual...

Increased organic orders and traffic: A healthcare pharmacy giant
doubled their revenue in less than six months
0
5000
100...

CUSTOMER
INTERACTIONS
KPO
BACKOFFICE
AI will grow India’s strength in the services market
SERVICES SOFTWARE
PREDICTION 2

2024 Trend – 3
Cybersecurity is gaining
prominence in India's
technology growth journey

Source: Data Security Council of India, Cert-IN, News clippings
Cybersecurity attacks in India are growing rapidly
0.2
0.4...

2.4
3.4
4.7
6.1
2020 2021 2022 2023
India cybersecurity market
($ Billion)
DOMESTIC CONSUMPTION OF
CYBERSECURITY SERVICES ...

1. 2. 3. 4.
Four key tailwinds that help create unique opportunities
for servicing the Indian market
Source: BVP Desk Rese...

Source: Teamlease, LinkedIn Talent Insights, CBRE
1. India is one of the major global talent hubs
and continues to grow
10...

Source: BVP Desk Research, MEITY, PWC Digital Survey 2024 - India
Macro budgets continue to grow leading to further resili...

Source: Various Indian news outlets
3. AI has also opened up new attack vectors

Source: DPDP Act, Data Security Council of India
4. The regulatory landscape has tightened up with DPDP
INR 250 Cr
Failure...

Source: Various Indian news outlets
Cyber insurance: A key part of building cyber resilience

Data breaches in India potentially generate more than
$100 billion in losses each year
Source: IBM Security, Cert-In
~$2 M...

Yet cyber insurance penetration is still < 1%
…with a long way to go
Source: Deloitte Cyber Insurance Report, PwC Cyber Re...

Sumit Nigam, CTO, Perfios
Source: BVP Interviews
At Perfios, cybersecurity is integral to our vision of transforming
finan...

Hilal Lone, CISO Razorpay
Source: BVP Interviews
At Razorpay, cybersecurity is fundamental to our mission of
enabling seam...

Indian cybersecurity companies will emerge to serve
domestic and global markets
NETWORK SECURITY
DATA PRIVACY AND PROTECTI...

2024 Trend – 4
A wealthier nation will be
catalyzed by software

Source: AMFI, BVP Desk Research
India’s wealth story is at an inflection point
19 20 21 22 23 25 28 31
35
41
55
90
114
201...

Source: McKinsey, 360One WAM, Jefferies, BVP Desk Research
As the number of affluent households grows, savings invested
in...

TRADITIONAL
NEW
AGE
MANUFACTURERS DISTRIBUTORS TECH ENABLERS
Cloud software will power the next unlock in the Indian
wealt...

Industrial SaaS will start scaling
as Industry 4.0 matures and
Industry 5.0 arrives
2024 Trend – 5

Source: From Industry 1.0 to Industry 5.0. | Download Scientific Diagram (researchgate.net)
From industry 1.0 to 5.0: Wher...

Make In India tailwinds will spur technology adoption in
the Indian manufacturing sector
MII GOVERNMENT SCHEMES TO
PROMOTE...

Sustainable operations will be a key focus area and ESG
software will become a “must-have” vs a “good-to-have”
Source: BVP...

Penetration of AI use cases will increase across quality, safety,
and production efficiency in manufacturing
Self-learning...

Industrial software will transition from on-premise
to cloud deployments
v
PREDICTIVE MAINTENANCE INDUSTRIAL VISION INSPEC...

Rise of Cloud AI in India 2024 — Five key predictions
AI will grow India’s strength in
the services market
IndAI SaaS oppo...

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