According to a report from social media giant Meta, approximately 70% of startups surveyed have begun utilizing artificial intelligence for essential business operations.

Insights based on a survey of 100 high-growth Indian startups were included in the Meta Emerging Businesses Report, which was prepared by professional services firm Alvarez & Marsal, India.

Over 70% of startups are incorporating it into their business processes.  In the field of marketing, 87% of those who adopted AI reported an improvement of approximately 30% in their cost per acquisition (CPA).  According to the report, industries like healthcare, edtech, and beauty are at the forefront of AI maturity, utilizing automation for customer service, predictive analytics, and personalization.

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Approximately 95% of the surveyed startups reported having broadened their operations in Tier-II and III cities.

Tier 2 and 3 markets are becoming the new battlegrounds for scale. Nearly all of the startups surveyed are expanding into these areas due to demand, digital accessibility, and ease of distribution.  According to the report, service-based startups are entering these markets almost a year ahead of product counterparts.

“In today’s fast-paced environment, startups that are smart in their thinking and quick to act on their development will spearhead the movement.  “At Meta, we take pride in our partnership on this journey, providing startups with state-of-the-art AI-driven tools to facilitate their growth and transform their ambitious concepts into real-world results,” stated Sandhya Devanathan, Vice President, India and South East Asia, Meta.

The research indicates that 52% of startups are pursuing cross-border expansion, primarily due to the larger total addressable markets and the growing global demand for products from India.

The USA, UAE, and UK became the leading export markets.

“There is a notable change in the mindset of Indian startups regarding scale: it is no longer just about growth but also about creating more sustainable businesses centered on value creation.  AI, tiered expansion, and omnichannel models are no longer speculative investments for the future; they are essential components of current execution.  Himanshu Bajaj, Managing Director & Head at Alvarez & Marsal India and GCC, remarked, “What is striking is the surprisingly sophisticated way that early-stage startups are applying these levers.”