India’s start-up ecosystem has witnessed exponential growth over the last decade, with a surge in early-stage funding, digital penetration, and consumer affluence across both metros and non-metro regions, according to a report released by Meta in collaboration with professional services firm Alvarez & Marsal India on Friday morning.
As India’s startup ecosystem accelerates into its next growth phase, emerging businesses were reshaping their growth through digital innovation, said the study which identified six key levers of growth of India’s startups such as: AI adoption, cross-border expansion, omnichannel presence, Tier 2/3 market expansion, category diversification, creator-led brand building.
With AI becoming a game-changer for marketers, the report prepared based on conversations with 100 high-growth startups found that over 70% of startups were integrating artificial intelligence into their business operations. In marketing alone, 87% of AI adopters reported a 30% improvement in cost per acquisition.
Sectors such as healthcare, edtech, and beauty were leading in AI maturity, leveraging automation for customer service, predictive analytics, and personalisation, it found.
Sandhya Devanathan, Vice President, India and South East Asia, Meta said, “In today’s dynamic times, startups that think smart and act fast to evolve will lead the charge.”
The report also outlined how 67% of startups have adopted omnichannel models, recognizing that modern consumer journeys often toggle between online and offline. Discovery typically starts with digital ads, creator-led Reels, or WhatsApp messages and ends in physical retail, particularly in high-involvement categories like fashion, home, and fitness, it further said.
Himanshu Bajaj, Managing Director & Head – Alvarez & Marsal India and GCC said, “We’re seeing a significant shift in how Indian startups think about scale—not just for pursuing growth but building more sustainable businesses that focus on value creation.’‘
He further said, AI, tiered expansion, and omnichannel models were no longer future bets—they were foundational to execution today. ``What stands out is how early-stage startups are applying these levers with surprising sophistication,’‘ Mr. Bajaj added.
According to the study, tier 2 and 3 markets are becoming the new battlegrounds for scale. Nearly all surveyed startups are expanding into these regions, driven by demand, digital accessibility, and ease of distribution. Service-based startups are entering these markets almost a year earlier than their product counterparts, using WhatsApp, vernacular content, and regional influencers to break through.
The report also said going global was no longer reserved for mature players. The study showed 52% of startups were expanding cross-border, largely driven by larger total addressable markets (TAM) and increasing global appetite for Indian-origin offerings. USA, UAE, and the UK emerged as the top export markets.
