The Bay Area stamp of approval: Why India’s AI startups need brand building to win trust?

The early excitement that AI tools were ready for overnight adoption has given way to a sobering reality. Enterprises now see that while AI can deliver 30-40% efficiency gains, most solutions still need refinement to handle real-world complexities. As Shekhar Kirani, Partner at Accel, one of the leading venture capitalists firm says, “the biggest mistake was the hype that made everyone rush into half-baked AI products. Enterprises are being trained to wait."

Addressing a media roundtable, Kirani, who primarily invests in AI startups, shares that a glaring challenge for Indian AI startups is the lack of inherent trust from domestic enterprises. And he highlighted this with a telling example: "I can’t force Swiggy, our own company (portfolio startup), to use an Indian platform unless it’s already being used in the Bay Area." This mindset where Indian enterprises look westward for validation reveals a deeper issue that India’s AI ecosystem lacks the brand equity to command instinctive confidence.

Even when homegrown solutions are superior, enterprises prefer global incumbents simply because they are "safe" choices. Startups must work harder to prove their worth often needing marquee clients or Silicon Valley adoption first. Many enterprise AI pilots struggle to scale due to inconsistent performance or overpromising. 

As Kirani noted, “commercial quality for everybody is still very hard but there’s a subset of users who are crazy about these products." The lesson? Nailing a niche use case is better than chasing broad, shaky adoption. Despite these hurdles, enterprises are adopting AI in areas where the ROI is undeniable like customer support, HR workflows. 

Kirani also asserts that without strong brand credibility, India’s AI startups will always play second fiddle to global giants. To compete, they must focus on vertical leadership, prove reliability early and win global validation even if it means launching in the Bay Area first. 

The funding as well is increasing among AI startups where Kirani observed that AI-first companies with rapid revenue growth command premiums sometimes 3–5x higher than traditional SaaS firms at similar stages. He also mentioned that they are looking at companies solving for “new” use cases.

As Kirani observed, "The world is shifting from ‘present and sell’ to ‘show and sell.’" For Indian AI, the time to build trust and not just tech is now.