India’s high-growth startups are evolving their playbooks to meet the demands of a rapidly shifting consumer landscape, with a clear push toward artificial intelligence (AI), omnichannel strategies, Tier 2 and Tier 3 market expansion, and cross-border growth.

These are among the key findings of a new report released by Meta in collaboration with Alvarez & Marsal India, based on conversations with 100 high-growth startups and over 20 ecosystem stakeholders including Peak XV, Blume Ventures, Kae Capital, and NASSCOM.

AI adoption is no longer optional

According to the report, 70% of startups have adopted AI since 2021, with marketing being a core use case. Startups reported up to 30% lower customer acquisition costs (CAC) through AI-powered campaigns. Sectors such as healthcare, edtech, and beauty are leading in automation, personalization, and predictive analytics.

Meta’s Vice President for India and Southeast Asia, Sandhya Devanathan, said: “In today’s dynamic times, startups that think smart and act fast to evolve will lead the charge. At Meta, we’re proud to be partners in this journey, equipping them with cutting-edge AI-powered tools to help them scale and turn their bold ideas into impact.”

Bharat-first expansion underway

Nearly all startups surveyed said they are expanding into Tier 2 and Tier 3 markets, where digital adoption, rising incomes, and infrastructure improvements are driving demand. These markets, the report notes, are often tapped earlier by service-based startups than by product companies.

The rural consumer base is also shifting faster than expected. Rural monthly per capita expenditure (MPCE) has outpaced urban spending between FY12 and FY24.

Omnichannel is the new standard

The shift to omnichannel commerce is no longer limited to established brands. About 67% of startups have gone omnichannel—integrating both online and offline touchpoints—with 57% doing so within their first three years.

This reflects a broader consumer trend, where 70% of shoppers now blend online research with offline purchases. In high-involvement categories such as fashion and home, discovery starts digitally and ends at a store.

New categories, new customers

As brand equity builds, startups are also entering adjacent product lines. About 84% of startups surveyed have moved beyond their original categories, relying on tools like social listening, keyword analysis, and marketplace data to identify opportunities.

The push to diversify is often accompanied by investments in creator-led marketing, with 88% of startups collaborating with influencers—both niche and celebrity—for audience reach and community building.

Going global, early

Cross-border expansion is no longer limited to mature companies. The report finds that 52% of startups are now targeting global markets, particularly the U.S., UAE, and the UK. Drivers include increased demand for Indian-origin products and the search for larger total addressable markets.

Structural tailwinds

Several macroeconomic factors are enabling this shift. India’s GDP grew at 6.5% between FY19–24, making it the world’s fifth-largest economy. The median age is 30, and over 100 million people have joined the 20–24 workforce cohort.

Rising incomes, deeper internet penetration, and the spread of digital tools have contributed to broader startup activity. In 2024 alone, India crossed 150,000 DPIIT-recognized startups.

Himanshu Bajaj, Managing Director and Head – Alvarez & Marsal India and GCC, said: “We’re seeing a significant shift in how Indian startups think about scale—not just for pursuing growth but building more sustainable businesses that focus on value creation. AI, tiered expansion, and omnichannel models are no longer future bets—they’re foundational to execution today.”

He added, “What stands out is how early-stage startups are applying these levers with surprising sophistication.”

Who was surveyed

The 100 startups surveyed came from a diverse set of industries—fashion (24%), healthcare and fitness (16%), beauty and personal care (14%), food and beverages (9%), and edtech (8%) led the mix. Others included home/kitchenware, spiritual-tech, and financial services.

About 65% of the startups were between 5–10 years old, with the majority earning between ₹20–100 crore annually.

As India’s startup landscape matures, the report offers a real-time snapshot of how younger businesses are thinking about growth—not just in terms of revenue, but also reach, relevance, and resilience.