Sarvam AI nears $1.5B valuation despite rejections from SoftBank and a16z
Bengaluru-based Sarvam AI faced rejections from several leading global venture capital firms in its latest fundraising but is on track to raise around $300 million to $350 million at a valuation of about $1.5 billion.
According to Bloomberg, the company approached major investors including SoftBank, Prosus, Andreessen Horowitz (a16z), General Atlantic, and Accel. Most passed, and Accel exited late in the process.
Sarvam AI, founded in August 2023 by Vivek Raghavan, a key architect of India’s Aadhaar digital identity system, and Pratyush Kumar, focuses on building a full-stack sovereign AI platform. This includes large language models, speech-to-text, text-to-speech, translation, and conversational tools that support more than 22 Indian languages.
The startup trains its models on Indian data and aims to run them on domestic infrastructure for better relevance, affordability, and data security for the country’s 1.4 billion people.
Rise as a Sovereign AI Leader
Sarvam gained attention through its involvement in the government-backed IndiaAI Mission. In 2025, the Ministry of Electronics and Information Technology selected the company to help develop indigenous foundational models.
It has released models such as the Sarvam-30B and 105-billion-parameter flagship (built from scratch using Mixture-of-Experts architecture) trained on Indian compute resources.
At the India AI Impact Summit in February 2026, Sarvam introduced new tools including vision models for document processing and advanced speech systems.
Prime Minister Narendra Modi visited the company’s booth, which boosted its profile as a key player in India’s push for technological self-reliance.
These efforts position Sarvam as a leader in AI tailored to local languages, culture, and applications in public services, banking, and administration.
Officials and analysts view Sarvam as important for reducing reliance on foreign AI providers such as OpenAI and Google.
The startup has partnerships with states like Tamil Nadu and Odisha for sovereign AI initiatives and works with entities such as UIDAI for multilingual services.
The Funding Story
Bloomberg reported that despite the rejections from prominent investors who raised concerns about the company’s late entry into foundational model development and its business model, the funding round is advancing.
Bessemer Venture Partners is expected to lead, with participation from Nvidia (investing but not leading), Amazon, Prosperity7 Ventures, and others.
This would make Sarvam one of India’s largest AI funding successes and turn it into a unicorn.
Broader Context
This situation shows the challenges in India’s sovereign AI efforts.
The government has allocated significant funds through the IndiaAI Mission for compute capacity, data, and homegrown models.
Traditional venture capitalists remain cautious because of high development costs and competition from well-funded players in the United States and China.
Sarvam and similar companies highlight India’s strategy to create affordable and locally relevant AI instead of depending only on global tools.
Supporters push for more government help with compute access and incentives, while others question whether Indian models can reach the scale of international leaders.
The progress of Sarvam’s funding round will draw close attention as a measure of confidence in India’s AI sector.
The startup continues to advance its vision of AI developed in India for Indians.
Source: Bloomberg
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