“HCLTech plans to contribute about $150 million to Sarvam AI, while Bessemer Venture Partners (BVP) will add another $50 million to the round,” mentioned one of the sources. “The remaining $100 million is expected to come from Nvidia, Prosperity7, Activate, Glade Brook, and others, including existing investors.”
Sarvam AI is supported by investors like Khosla Ventures, Lightspeed, and Peak XV Partners, among others, who are anticipated to join the round on a pro-rata basis. The funding round is expected to value Sarvam at $1.5 billion (around ₹14,250 crore) post-money, marking a 7X increase since 2023, with closure anticipated in the upcoming weeks.
Neither Sarvam AI, HCLTech, Bessemer Venture Partners, Prosperity7, Glade Brook, Activate, nor Nvidia responded to Moneycontrol’s inquiries.
Moneycontrol exclusively reported on March 24 that Sarvam AI had initiated discussions to secure $250 million from HCLTech, NVIDIA, Accel, and others in what would be one of the largest funding rounds for an Indian AI startup in recent history.
Shortly thereafter, Moneycontrol was the first to disclose on April 1 that Accel had decided to withdraw while Bessemer Venture Partners was actively pursuing a deal with the company. BVP’s US Partner, Sameer Dholakia, was leading the negotiations, according to the report.
AI threat to IT companies
Should this deal materialize, it would represent a notable instance of a legacy Indian IT services firm supporting a local AI startup. India’s major IT companies have faced scrutiny for their slow approach to aggressive investments in emerging technologies like AI, often prioritizing capital for buybacks and dividends over long-term R&D initiatives.
Recently, Indian IT stocks have faced pressure due to increasing apprehensions that advancements in AI models from companies such as Anthropic could disrupt substantial segments of the traditional outsourcing domain. Investors are increasingly doubtful about whether Indian IT firms are adapting swiftly enough to modify their business frameworks and develop meaningful AI-oriented capabilities as automation evolves software development and back-office functions.
Launches build momentum
Sarvam’s $300 million funding round is poised to become the largest private market funding event for an Indian startup this year, marking the most significant capital infusion into a dedicated Indian AI startup to date.
Moneycontrol also first reported that Emergent, an AI coding startup, was finalizing a $250 million round from Creaegis and others.
This latest funding round will symbolize Sarvam’s first substantial cash influx after about two-and-a-half years. The startup previously raised $41 million in its Series A funding round in December 2023, led by Lightspeed Ventures with contributions from Peak XV Partners and Khosla Ventures.
Interest in Sarvam has surged since then, with investor confidence around the Bengaluru-based startup bolstered just weeks after it unveiled two large language models (LLMs)—a 30-billion-parameter model and a 105-billion-parameter model, both crafted from scratch in India during the India AI Impact Summit in New Delhi in February.
“(The models are) cheaper than something like a Gemini Flash, but outperform it in many benchmarks,” noted Sarvam co-founder Pratyush Kumar earlier this year. “Even when compared to a larger and pricier model like Gemini 2.5 Flash, we find that this model excels in Indian language performance.”
India’s sovereign AI models
Sarvam has emerged as a key figure in India’s AI landscape. Other notable contributors include Gnani.ai, a conversational AI firm, and the IIT-Bombay-led consortium’s BharatGen initiative, both focusing on foundational AI models as domestic startups and national programs intensify efforts to create homegrown alternatives to globally dominant AI systems led by Big Tech.
Sarvam has also become instrumental in India’s sovereign AI initiative. The IndiaAI Mission, supported by a ₹10,000 crore (~$1 billion) fund intended for building a national foundational model, has disbursed ₹111 crore ($12 million) in GPU subsidies to date.
The standout beneficiary so far is Bengaluru-based Sarvam AI, which secured a remarkable 4,096 NVIDIA H100 SXM GPUs through Yotta Data Services, obtaining nearly ₹99 crore ($11 million) in subsidies.
Founded in July 2023 by Vivek Raghavan and Pratyush Kumar, former associates at the Nandan Nilekani-backed AI4Bharat, Sarvam offers a full-stack solution for Generative AI, encompassing research-driven innovations in training custom AI models and an enterprise-grade platform for authoring and deployment.
