Per Tracxn data, five such deals in the AI services and analytics space have taken place in the last four months alone, compared to 10 in 2025. Thermax acquired ExactSpace, a specialist in AI-driven industrial IoT solutions, while cloud communication leader Exotel acqui-hired talent from voice-AI startup Dubverse. Meanwhile, enterprise AI operations platform Invisible Tech picked up WeCP, an AI-native technical assessment tool for developer hiring, and BPO firm Ubiquity acquired Shaip for its capabilities in AI training data. Finally, data analytics firm Kaizen Analytix acquired Nihon Technology, an IT services provider focused on ERP and Japan-India cross-border digital transformation.
Further, in March this year, C5i, an analytics firm, acquired UK-based data and AI company Datavid in a $45-50 million deal.
In the recent past, Fractal Analytics, which listed this year, invested in Analytics Vidhya in 2021, and this March approved an additional investment of Rs 39.4 crore in Analytics Vidhya Educon, now a wholly-owned subsidiary. In 2022, it had acquired Neal Analytics to enhance its cloud AI consulting and engineering capabilities.
In 2024, Sarvam AI acquired Pipable AI for data extraction and structured data processing, while InMobi raised $100 million in debt to fund potential AI acquisitions. LatentView Analytics acquired 70% stake in Decision Point Analytics for $39.1 million in March 2024.
Investors said a lot of the activity is in the application layer, where most of the innovation and use cases are emerging, and where the highest amount of consolidation is expected. Acquisitions, they said, will primarily be driven by product capabilities and intellectual property.
“There are many different kinds of capabilities required today — different industries, different use cases, different types of technology stacks, and specialised technologies like graph data engineering,” said Ashwin Mittal, executive chairman, C5i.
He added that because of this diversity, companies will need to bring in complementary capabilities. “It’s difficult to build everything internally, so firms will need to selectively acquire or partner to strengthen their offerings.”
Another founder, Srikrishnan Ganesan, whose product Konotor, a mobile-first customer support system, was integrated into Freshworks’ Freshchat in 2015, said implementation has become a key differentiator. “Companies that can deploy AI well are winning more business and building stronger customer trust.”
Ganesan’s startup Rocketlane, which works in the professional services automation (PSA) space, recently raised $60 million from New York-based Insight Partners.
On what could further drive consolidation in this space, venture fund 3one4 Capital’s cofounder Siddarth Pai said that companies are aggregating multiple AI models into their platforms. These are not always built in-house, so integrating external capabilities becomes valuable.
Building an AI suite
“We’ve seen this play out in earlier technology cycles, but what used to take several years is now happening much faster because of the pace at which AI is evolving,” Pai said.
Founders and investors said that companies recognise that having a single product can be risky as the market is moving rapidly, and new products are emerging, making it important to expand the product portfolio through acquisitions.
“I think we will definitely see consolidation, particularly where strong IP is being built,” Ganesan added. He said Rocketlane constantly tracks startups in adjacent areas for the future, though many may not yet have enough traction or proof of value to justify acquisitions today.
There is also a shift in customer behaviour, with enterprises increasingly preferring fewer vendors that can offer more integrated, end-to-end solutions. This could drive both consolidation and partnerships across players, experts said.
The Indian ecosystem is also betting on large global AI companies going public, which could further accelerate acquisition activity.
Manav Garg, managing partner at Together Fund, said a key trigger for consolidation will be the IPOs of companies such as OpenAI and Anthropic. “You’re already seeing signals — large capital inflows from SoftBank and others are being arranged. Once these IPOs (initial public offers) happen, it will accelerate M&A activity in the AI ecosystem,” he said.
Another driver is large incumbent companies sitting on significant capital, which have not fully participated in the AI wave yet.
“Companies like IBM, Cisco, Salesforce, and even Figma have significant cash reserves. They now need to catch up in AI, so they will also become active acquirers,” Garg said.
In India, he added, M&A activity is likely to be modest. “It will not be at the same scale as the US, but there is definitely potential. A lot will depend on the kind of companies we are able to build.”
Not all buyouts work
Founders are cautious as not all acquisitions deliver the expected results. Mittal said, “Acquisitions are complex and not all of them create value. There are studies showing that around 60% of acquisitions fail to deliver the expected results.” He added that C5i is focussed on acquiring strong companies that make a meaningful difference and is not looking at stressed assets or turnaround situations.
At the same time, building has become easier with AI, so companies will balance between in-house development and selective acquisitions, Ganesan said.
Voice AI startup Gnani.ai’s cofounder Ganesh Gopalan said that while building intellectual property is key, acquisition is not necessary for success. “There might be some inherent benefits attached to M&As, but they’re not necessary. A lot of customers value the fact that you are a nimble company. they value that you can move faster compared to a large conglomerate.”