Bengaluru continues to lead as India’s top startup hub, backed by supportive government policies and a strong private sector. Karnataka is home to around 300 venture capital firms, further strengthening its position as a prime funding destination. Bengaluru-headquartered startups have raised a total of approximately $79 billion in VC funding since 2010 including. The state has captured about 46% of all VC investments into Indian startups, playing a key role in a national ecosystem that has created over 140,000 technology startups during that same timeframe.
In 2025, the Government of Karnataka launched the Startup Policy 2.0 (2025–2030) with an outlay of $62.4M, targeting the creation of 25,000 new startups. It focuses on strengthening incubation infrastructure, mentorship networks, and R&D in Frontier Technologies such as AI, Quantum Computing, and Blockchain, and embeds capital support mechanisms, enhances incubation programs, and deepens engagement with global partners across the state. The Global Innovation Alliance continues to expand international collaboration through cross-border partnerships, technology exchanges, and joint research.
Programs such as KATALYST, a facilitation platform for Global Capability Centre (GCC) expansion, aim to embed Bengaluru and Karnataka more deeply into global value chains. The Karnataka Digital Economy Mission (KDEM) plays a pivotal role in expanding Karnataka’s digital economy by enabling market access for startups and fostering international partnerships.
The Government of Karnataka’s $110M Local Economy Accelerator Program (LEAP) establishes new Centres of Excellence in areas such as Defence Technology & Industry 5.0, Agri & Allied sectors, and Artificial Intelligence & Quantum Computing, hosted in leading institutions across the state. Under LEAP, grant programs including ELEVATE Nxt provide up to $110,000 grants supporting Deep Tech startups.
In January 2026, payments infrastructure company Juspay reached a $1.2B valuation, becoming one of the year’s first unicorns. Leading banks including Punjab National Bank, State Bank of India, HDFC Bank, IDFC FIRST Bank, and ICICI Bank are opening dedicated startup branches in Bengaluru, providing enhanced capital access, tailored financial products, and advisory to early-stage companies.
Bengaluru-Karnataka
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Highlights
Ecosystem by the Numbers
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AI-Native Ecosystem Value
AI-Native Ecosystem Value Growth
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AI-Native Early Stage Funding Growth
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TOTAL EARLY–STAGE FUNDING
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EXIT COUNT (#)
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Top Funded Startups
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Sub-Sector Strengths
AI innovation in Bengaluru is driven by dedicated initiatives and ecosystem support that translate research into market-ready technologies. In January 2026, the Government of Karnataka approved the Centre for Applied AI for Tech Solutions (CATS) with a $2.4M investment, partnering with Nasscom to boost AI, Robotics, automation, and digital transformation. Bengaluru attracts 58% of India's AI startup funding, with ~$1.5B raised since 2020, of which $1.2B-plus has flowed into application-layer AI startups, underpinning vibrant formation across generative AI, clinical, and data analytics ventures.
Karnataka anchors India’s Aerospace and Defense ecosystem, accounting for 65% of national business and 67% of aircraft manufacturing. A $24M Aerospace Common Facility Centre at KIADB Park strengthens testing infrastructure for MSMEs. Premier institutions such as Indian Space Research Organisation and Defence Research and Development Organisation position the state as a major hub for Aerospace and Space technology. The Government has constituted a Vision Group on Space Technology to guide growth. Supported by the Karnataka Aerospace & Defence Policy 2022–27 and Karnataka Space Technology Policy 2025–2030, the state hosts 81 companies that have raised ~$353M.
Bengaluru-Karnataka launched the $114M Karnataka Quantum Mission in July 2025 to build a $20B Quantum economy by 2035 with Q-City near Bengaluru — an integrated hub for quantum R&D, hardware manufacturing, and talent development. India’s first commercially-deployable 25-qubit Indus quantum computer became operational in Bengaluru in 2025, underscoring regional innovation. The state approved $5.6M to expand the Quantum Research Park at IISc Bengaluru, supporting startups, labs, and skilling initiatives, with programs in 20+ colleges and 150 annual PhD fellowships to strengthen the Quantum talent pipeline.
Selected Startup Organizations
Startup Genome Members
KDEM is established as a section 8 not-for-profit under Karnataka's Department of Electronics, IT, BT & Science and Technology, to serve as a knowledge bridge between government and industry. It aims to accelerate growth and investments across Karnataka’s digital economy, spanning IT, Biotechnology, and Science & Technology. KDEM focuses on strengthening IT/ITeS, BPM and GCCs, Innovation and Startups, Electronics System Design and Manufacturing, Talent Accelerator, and the Beyond Bengaluru initiative, while leveraging technology-led growth to generate employment and drive inclusive economic development across the state.
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