This article is part of Inc42’s Startup Watchlist annual series where we list the top startups to watch for 2018 from industries like AI, Logistics, Fintech etc. Explore all the stories from ‘Startup Watchlist’ series here.
“AI will be the best or worst thing ever for humanity,” says the billionaire entrepreneur Elon Musk. Musk has been one of the most vociferous about the impact of artificial intelligence or AI on human life, voicing both concern and hope of what it can do to the future of the human race.
“I have exposure to the most cutting-edge AI, and I think people should be really concerned by it,” Musk said at the National Governors Association. “AI is a fundamental risk to the existence of human civilization in a way that car accidents, airplane crashes, faulty drugs or bad food were not — they were harmful to a set of individuals within society, of course, but they were not harmful to society as a whole.”
While Musk has his concerns about robots taking up human jobs and becoming far more intelligent than humans, the fact remains that AI as a technology was the most talked about in 2017 in the Indian startup ecosystem.
Be it in ecommerce, fintech, banking, surveillance, customer service and support, big data, or analytics, or from intelligent shopping assistants to helpful conversational bots, AI is finding wider usage in our daily lives and will continue to do so.
I am not even delving here into robots, humanoids and machines working at malls or in banks. That’s another gamut altogether.
What I am referring to is the simple machine learning, NLP, and AI creeping into our phones, our machines, the apps and software that we use, that is slowly simplifying our lives, enabling us to talk to machines, or enabling ecommerce players to understand customer behaviour, or helping banks service customers through AI-powered chatbots.
How Did The AI Sector Fare In India In 2017
And the proof is in the pudding.
As per Inc42 DataLabs H1 2017 report, the sector picked up by 100% in H1 2017 in comparison to H2 2016, in terms of deals. With Bengaluru being the major breeding ground for AI startups in India, about $87.85 Mn was raised across 58 deals in the AI space.
In 2017, the biggest amount of funding raised by an Indian AI startup was bagged by Big Data startup Qubole that raised $25 Mn in a funding round led by Singtel Innov8, Harmony Partners among others. Next came customer data analytics software company Flytxt that raised about $11 Mn funding from DAH Beteiligungs GmbH.
The AI sector also saw quite a few acquisitions this year as well because of rising interest in the space both from homegrown and foreign companies alike. In the month of March, e-Zest Solutions, a digital transformation solutions provider acquired SmarterMe, a personal assistant for sales powered by an intelligent mobile platform that is enabling salespeople at small businesses to Fortune 500 enterprises to work smarter.
Similarly, Chinese mobile Internet company APUS Group acquired AI-driven photography curation platform SIFTR Labs for an undisclosed amount, hinting towards the continued interest of global players in building their arsenal of machine learning technologies.
July saw global tech giant Google dialling in the Indian AI space, snapping up merely four months old Bengaluru-based AI (Artificial Intelligence) startup Halli Labs for an undisclosed amount. The acquisition will allow Google to utilise Halli Labs’ advanced AI and ML (Machine Learning) technologies to upgrade older domains and platforms for better performance. The company will be part of Google’s Next Billion Users initiative, which is aimed at expanding the search engine giant’s user base by tapping into up-and-coming markets like India.
If tech giants are biting into the Indian AI startups, it definitely means that Indian startups are beginning to create noteworthy products in AI.
As we close the year and the AI rage continues unabated, with the global AI sector poised to grow to $16.06 Bn by 2022, here’s a spotlight on some AI startups that look poised for the next level growth in 2018.
Here’s our pick of 10 AI startups to watch out for in 2018
Absentia VR founded by three third-year dropouts from BITS Pilani Goa Campus aims to bridge the gap between existing e-content and virtual reality and extend that experience to everyone.
The VR startup has launched Norah.ai, a revolutionary, A.I. empowered workflow for generating games. The AI enables quick creation and incorporation of all different game elements ranging from creation of 3D models and their animation to story weaving and texturing.
Absentia owed its origins to the belief of the founders that they could create India’s first AI empowered game workflow with Deep Learning, Neural Network & Artificial Intelligence at its core. Powered by auto-encoders and pre-trained AI, Norah generates unique real-time animations that add to the fast-growing animation repository.
The AI system that combines auto-rigging, facial expression and locomotion generation with the possibility to blend and mix existing animations explores new avenues in animation and game design.
Absentia VR has been backed by investors such as Astarc Ventures, 50K Ventures, Exfinity Venture Partners, T.V Mohandas Pai, Deepak Ghaisas, Girish Paranjpe and V. Balakrishnan. Its competitors include other VR startups like Infurnia, SmartVizX, Whodat.
Virtual reality is a potential multi-billion dollar market worldwide, with an emerging presence in India today. It has applications in a number of verticals including gaming, education, healthcare, real estate, architecture, online shopping etc. Remember how Facebook had bought Oculus, a virtual reality company, for about $2 Bn in 2014?
Absentia VR’s application Norah AI will enable companies to create interactive content for games, with minimal human assistance for various gaming experiences and types, including arcade games, casual games, puzzles, animation and graphics. It will essentially offer a neural network to content creators, where they’ll be able to create games, GIFs and animations etc.
With its advanced AI technology, Norah is aiming to become the end-to-end solution for animation and game development. As per Mishra, this will drastically reduce the time taken to develop games from 30 days to about 30 hours.
Given that as per a Google KPMG report published in May 2017, the online gaming industry in India is estimated to be worth over $360 Mn and poised to grow $1 Bn by 2021, Absentia may just be on the right track to tap the fast-evolving VR vertical in the country.
Bengaluru-based Niki.ai founded by four IIT Kharagpur alumni is an AI-powered shopping assistant. Through its chatbot SDK, Niki.ai leverages the technology of natural language processing and machine learning to converse with the customers over a chat interface, to shop for products and services.
The startup managed to raise funding from heavyweights like Ronnie Screwvala’s Unilazer Ventures and Ratan Tata himself. It most recent investor is a global leader in business management software SAP. Other startups that compete with Niki.ai include Arya.ai, Retention.ai, Active.AI, among others.
AI was the buzzword in 2017 and niki.ai is fully positioned to leverage it. Starting from supporting end-to-end bookings for Ola and Uber cabs and an in-chat payment option using Paytm Wallet, the AI startup’s chatbot offers bill payments, cab booking, recharge, food ordering, home services, and cricket scores.
Niki currently supports over 20 categories including entertainment, travel, daily utilities, with partners such as BookMyShow, Redbus, OYO, Ola, Uber, JustRechargeIt, HDFC, among others. The company claims to have a 35% month-on-month revenue growth, and about 50+ partners on board.
On the customer front, the company has more than 400K customers using its product. That is no mean feat for a chatbot app which has a clear-cut focus on marrying commerce with AI.
Bengaluru-based IoT startup Flutura is a big data analytics solutions provider with a vision to transform operational outcomes by monetising machine data. It does so by triangulating economic impactful signals from fragmented data pools.
Flutura’s flagship software platform, Cerebra, provides diagnostics and prognostics through machine learning and artificial intelligence, to unlock new business value for engineering and energy customers across the globe.
Its clientele includes the likes of Henkel, Hitachi, GTT, Stewart & Stevenson and Sodexo, etc. Flutura already has several notable partnerships in its industry including Siemens, Haliburton and Bosch.
The Industrial Internet-of-Things (IIoT) startup has been recognized as one of the Top 20 Most Promising Big Data Companies globally by California based Tech magazine CIO Review in 2015. Flutura has been backed by Vertex Ventures, Lumis Partners, and Palo Alto-based The Hive.
No wonder Flutura competes with biggies like GE’s Predix and PTC. As per a recent report, the IIoT market is expected to reach $195.47 Bn by 2022 and Flutura which has operations in Palo Alto, Houston, Tokyo, and Bengaluru looks all set to garner even bigger clients post its funding round this year.
Bengaluru-based Uncanny Vision delivers AI-based surveillance solutions. Using deep Learning-enabled vision algorithms that have been optimised to run on Edge servers, the company provides cost-effective and scalable security for next generation safe cities and smart industries. It also enables real-time actionable surveillance and analytics for high-value customers in retail and banking.
In addition, its Software Toolkit enhances the performance of computer vision algorithms. Its products include UncannyCV – A computer vision/image processing library; UncannyDL – an on-device Deep Learning library for mobile and embedded applications; and UncannySurveillance – an Award-winning AI-based surveillance solution targeted at challenging security and analytics applications.
The startup was selected as one of India’s Most Innovative Top 50 Emerging Software Product Companies at the Nasscom Emerge 50 Awards 2017. Prior to that, it was also as one of the five video analytics startups for the first cohort of Smart City/Smart Building NanoAccelerator programme in November this year.
It also graduated from the Target Accelerator Program in September 2016 and was also a part of the third edition of Nasscom Innotrek 2016. The startup has managed to raise funding from none other than Facebook’s Product Head Anand Chandrasekaran himself.
The team has 100+ years of combined experience in IoT, Computer Vision and AI. Its main surveillance product is an intelligent surveillance camera that uses deep learning for scene/face/human pose recognition. One of the first target application for Uncanny Surveillance is ATM monitoring and is currently being evaluated by leading companies that work in the banking sector in India and North America.
The startup’s product address today’s critical area of surveillance by blending its expertise in AI, Computer Vision, and IoT. In today’s world demanding which is increasingly demanding smarter surveillance solutions, Uncanny Vision might just have the technology to serve that growing need.
No wonder, the startup also made it to the list of startups recognised by Amazon in its Amazon AI Awards for 2017! It will definitely be worth watching how Uncanny Vision fares in 2018.
Delhi-based AI startup Innefu Labs claims to have built on artificial intelligence technology to provide cybersecurity solutions pertaining to biometrics authentication and multi-factor authentication, besides data analysis to predict and prevent virtual threats.
Innefu Labs has been backed by IndiaNivesh Venture Capital Fund. It serves clients from diverse industry verticals – including law enforcement, BFSI, BPOs/KPOs, ecommerce, IT/ITES, education, telecom etc.
Who does it compete with? Other local companies that monitor, identify and respond to cyber threats include TAC, Sequretek, Kratikal Tech and Lucideus Tech.
Demand for credible cyber security products is only likely to rise given the spate of rising cyber-attacks. A report published by MarketsandMarkets in July 2016 forecasts the global cyber security market to grow from $122.45 Bn in 2016 to $202.36 Bn by 2021.
To address the challenge, Innefu Labs built AuthShield, a patented security solution. It employs an image and speech-based authentication system.
To log into a system or an application, a user needs to click a selfie from his phone or speak a few words. The selfie is then matched using a 3-D modelling pattern with the user’s features (stored in the software), to enable him access to the device.
For voice recognition, the user’s speech pattern is matched. As per Innefu Labs, it has about 100 customers ranging from the Indian Army, DRDO, state police departments, intelligence agencies, public sector companies, leading banks and private companies including Mahindra and Mahindra Group.
With revenue of $391K (INR 2.5 Cr) reported for 2015-16, Innefu Labs looks set on its path to tackling cybercrime with AI.
The Bengaluru and San Diego headquartered NetraDyne is an artificial systems provider which has an R&D centre in India is on the verge of launching the IoT-based Driveri platform. This is a driver monitoring device for commercial and fleet management companies.
In June 2016, Reliance Industries Ltd (RIL) announced that it has decided to invest $16 Mn in the startup. NetraDyne is developing deep learning solutions and vision-based analytics targeted at industries such as fleet management, automotive, security and surveillance.
Agrawal, a Stanford University graduate, was Senior VP, Technology and Business at Qualcomm for over 10 years. He was also President of Qualcomm India & South Asia, responsible for the company’s business, sales and marketing operations in the region.
Julian co-founded Mountain View Analytics, a financial investment startup, and later worked as a principal engineer in Qualcomm Research for 12 years. Both the founders have a solid IoT experience. Agrawal believes that the timing of Netradyne Driveri product could not have been more apt considering the current push towards IoT and AI.
Netradyne’s Driveri aims to alert fleet managers and drivers about any untoward incident or emergency on the road based. This is done based on the device which is mounted behind the rear-view mirror of vehicles which captures videos in a 360-degree format. The device analyses things on road and detects anomalous driving behaviour. It even sends these videos to the cloud for further analysis.
With this, it tracks single vehicle on the road or if the driver is breaking traffic rules. While this might prove to be a boon for fleet management companies, how will Driveri adapt to Indian conditions remains to be seen.
Active.ai is an AI and SaaS-enabled platform that connects consumers with its banking partners through micro-conversations. The startup’s AI engine, Triniti employs machine learning, natural language processing, natural language generation and IoT. The virtual assistant powered by AI can cater to the emergent banking needs of the users.
Active.ai utilises AI to help financial institutions develop personalised and contextual interaction solutions which can be used by consumers through web, mobile, social and messaging channels. In simple terms, it offers a tech platform for banks, wealth managers, and financial services companies to interact with customers. The startup partnered with Axis Bank last year to launch intelligent banking chatbots.
The startup has backers like Vertex Ventures, Creditease Holdings, Dream Incubator, Kalaari Capital and IDG Ventures. Other startups in the same space include niki.ai, Arya.ai, Retention.ai among others.
Given that the fintech industry in India is poised to grow to cross $2.4 Bn by 2020, as per reports by KPMG India and NASSCOM, Active.ai’s proposition of marrying AI with fintech will find many takers in the future.
Bengaluru-based FORMCEPT is a unified data analysis platform. It helps enterprises get actionable insights from their data faster. MECBOT, the company’s flagship product, is an Open Cognitive Platform. It transforms the way data analytics, deep learning, artificial intelligence (AI), predictive analytics, and IoT interface with each other on a near real-time basis.
This leads to superior efficiencies, smart monitoring, and intelligent resource management. The startup is an incubatee of the Centre for Innovation Incubation and Entrepreneurship (CIIE) – IIM Ahmedabad.
In June this year, it raised an undisclosed amount of Series A funding from VC fund GVFL (Gujarat Venture Finance Ltd). Startups that compete with it in the data analytics segment include IntelligenceNODE, Indus Insights, Axtria, BRIDGEi2i, DataCultr, etc.
Formcept claims to derive actionable insights from data in half the time and at one-third the cost. AI empowered by big data is disrupting the entire data analysis space and MECBOT just seems to be at the right inflection point on the global growth trajectory. Proof of it?
The handful of Fortune 1,000 clients the startup has been able to garner. FORMCEPT recently worked with ESPN Cricinfo, to develop an end-to-end, comprehensive query-enabled platform that enables access to searchable cricket big data and statistics in a user-friendly manner.
Data is the new oil and Formcept’s ability to employ AI with big data put it as a worthy contender in the list of data analytics startups that are giving big IT majors a run for their money.
Another startup to watch for in 2018 is Gurgaon-based Staqu, an Artificial Intelligence (AI) focused research firm working in automated image understanding technology. Staqu enables automation of some of the crucial tasks for ecommerce companies which include image search, tag generation, real-time recommendation.
Staqu’s key focus areas include image processing, deep learning, computer vision, NLP, and overall improvement of users’ daily mobile experience through AI and engineering.
Staqu’s mobile-based platform which uses deep learning and machine learning technologies to cater reverse image search solutions. It’s business partners range from OEMs like Panasonic, Intex, Lava, Karbonn and several ecommerce portals, such as Paytm, Yepme, Roposo, Tradeindia, Microsec Finance, Faballey, and E-poolers.
The AI-based startup was also picked amongst the top four startups by IBM’s Global Entrepreneur Programme in 2015 and was one of the winners of IBM Smartcamp for Deeptech in India startup challenge in 2016.
In fact this year, it also launched a crime registration and search system – ABHED (Artificial intelligence Based Human Efface Detection.) The app will enable police forces to opt for mobile phone-based crime registration, including biometric information.
Staqu which has been backed by Indian Angel Network (IAN) competes with other AI startups like Niki.ai, Active.ai and Fluid AI among others
From fashion to crime, Staqu has shown a lot of potential. And given the fact that the especially given the fact the global AI market is estimated to be worth $16.06 Bn by 2022, Staqu will find many takers in times to come.
Mad Street Den
Amongst India’s first AI and computer vision startups, Mad Street Den, founded by the husband-wife duo of Anand Chandrasekaran and Ashwini Asokan aims to bring AI into the daily lives of people across the globe by working with businesses and brands in specific verticals. This includes online fashion, mobile gaming, user engagement & analytics, IoT and connected cars, and photos & social media.
The duo’s inspiration came from the fact that most AI companies were focussed just on building tools for engineers while only a few are concerned about actual consumer problems.
The AI startup counts Reservoir Investments’ Exfinity Fund, GrowX Ventures, and even heavyweight Sequoia India as its investors.
The startup’s flagship product Vue.ai serves up brands across the globe today from Asia to Middle East to the US and Europe. Vue.ai is a visual search engine which serves retailers, specifically in fashion, across the globe. It acts as an ultimate personal stylist for the shopper.
Also, it helps showcase the consumers, the products, and styles, relevant for them across apps, sites, stores – making the shopping experience more meaningful and relevant. Some of its clients include Tata, Voonik, Craftsvilla, Zilingo, Wadi and many more. The company also sells to online shopping sites such as furniture ecommerce site HipVan in Singapore and is now developing products for other verticals, such as gaming.
The startup also made it to Bloomberg list of the world’s 50 most promising startups this year. While it still has to hit profitability and branch out to domains other than retail, it remains to be seen how fast it can leverage the growing AI market compared to the competition.
While these were the Indian AI startups to watch out in 2018, stay tuned for next edition of Startup Watchlist, where we will be featuring fintech startups to watch out in 2018, click here for more stories!
[The startups mentioned above have been selected on editorial discretion, our interactions with the startups and other industry veterans.]