As much as 83% of respondents said AI would meaningfully change their business models or investment thesis in 2026, with 37% saying the impact would extend to core functions.
“Today, we are using AI to make all functions more productive. Hopefully in 2026, it opens up new business opportunities for us — either through new revenue streams or big cost reductions,” said Vidit Aatrey, cofounder and chief executive of Meesho, the ecommerce platform that listed recently.
A majority of respondents said they expect hiring to be significantly reduced due to AI adoption.
ETtechLeveraging AI
This comes after a year marked by large-scale job cuts at Indian and global tech firms, including Tata Consultancy Services and Amazon, and scaled-back campus hiring at companies such as HCLTech, Infosys and Wipro. However, 43% said they believe most jobs would adapt rather than disappear.
ETtechAt an organisational level, AI use was near-universal among respondents, with research and data analysis leading adoption at 92%. A majority also said they use AI in core functions such as engineering or product development (59%) and customer support or chatbots (52%). Adoption drops beyond core operations, with sales and marketing at 38%, finance, risk or compliance at 27%, and hiring or HR at 18%. On a personal level, AI use has become widespread.
ETtechAround 82% of respondents said they use AI for research or news summaries, followed by 78% who use AI-powered tools for writing, editing and creating presentations. Only 15% said they use AI for coding or technical help.
ETtech“The biggest theme being tracked for Indian startups next year (2026) is how companies can leverage AI to improve business economics and build lasting business models,” said Rohit Bansal, cofounder, Titan Capital and Snapdeal.
Public markets mood
The year 2025 saw the highest number of new-age companies and tech startups going public, surpassing the 2021 boom year. Among the larger listings in 2025 were at-home services startup Urban Company, EV scooter maker Ather Energy, eyewear brand Lenskart, fintech startup Groww and Meesho.
ETtech“I expect that public market sentiments will continue to be the same in 2026 as it was in 2025, and if that happens, we will see more startups opting for an IPO,” said the founder of a stockbroking startup.
Public market optimism is expected to persist in 2026, with 44% of respondents saying sentiment around new-age companies will remain similar to 2025. About 41% expect sentiment to improve, while 15% believe it will worsen. Several new-age companies, including Zepto, PhonePe, Flipkart, Shadowfax, Shiprocket, Boat and Curefoods, are expected to launch IPOs in 2026.
ETtech“The flurry of IPOs will lead to more founders starting companies and finding early backers. Given it’s a unique time to build during the AI platform shift, we’re very excited to see where audacious founders take the Indian startup ecosystem,” said a partner at a VC firm that saw several of its portfolio companies go public in 2025.
ETtechFunding momentum
Shifting tack from 2025, nearly two-thirds of fund managers surveyed said they plan to increase capital deployment in 2026. ET reported on December 19 that despite a pickup in growth-stage funding, overall startup funding remained largely flat in 2025 due to fewer large deals and evolving venture capital theses around early-stage AI investments.
ETtechData from Venture Intelligence showed startups raised $9.8 billion in 2025 till December 15, compared with $10.1 billion in 2024. About 38% of investors surveyed said their capital deployment in 2026 would remain similar to 2025 levels. Among sectors, respondents expect AI and deeptech to lead fundraising, followed by consumer internet, brands and fintech.
ETtech“We continue to be excited about the impact AI will have across enterprise, consumer, healthcare and financial services. Separately, India’s macro outlook is strengthening, and with the spate of IPOs, we expect increased activity,” an investor said.
ETtech