AI, cross-border growth, & omnichannel reshaping India's startup landscape: Meta-A&M report

Meta has commissioned a new report in collaboration with leading global professional services firm Alvarez & Marsal India (A&M India). This report, released on World MSME Day, captures insights from deep conversations with 100 high-growth Indian startups, outlining key trends driving the next phase of growth for India's startup ecosystem.

The 'Meta-Alvarez & Marsal India Report' identifies six critical levers shaping this evolution: AI adoption, cross-border expansion, omnichannel presence, Tier 2/3 market expansion, category diversification, and creator-led brand building.

Key findings from the report highlight significant shifts:

• AI Integration: Over 70% of startups are now integrating AI across core business functions. In marketing specifically, 87% of AI adopters reported approximately a 30% improvement in cost per acquisition (CPA). Sectors such as healthcare, edtech, and beauty are leading in leveraging AI for automation, predictive analytics, and personalization.

• Omnichannel Adoption: 67% of startups have embraced omnichannel models, recognizing that modern consumer journeys often toggle between online discovery and offline purchasing.

• Tier 2/3 Market Expansion: Nearly all surveyed startups are expanding into India's Tier 2 and 3 markets, driven by consumer demand, increased digital accessibility, and simplified distribution. Service-based startups are entering these regions almost a year earlier than their product-focused counterparts.

• Cross-Border Growth: 52% of startups are now expanding internationally. This trend is largely fueled by larger total addressable markets (TAM) abroad and a growing global appetite for Indian-origin products, with the USA, UAE, and the UK identified as top export markets.

Sandhya Devanathan, vice president, India and South East Asia, Meta, commented, “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.”

Himanshu Bajaj, managing director & head – Alvarez & Marsal India and GCC, added, “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.”

The report also details how category expansion has become a vital lever for startups to deepen consumer engagement and unlock new revenue streams, with 84% diversifying beyond their core offerings. Additionally, creator-led brand building is a significant trend, as 88% of brands partner with creators, including niche influencers and celebrities, often within their first two years of operation.

The report serves as a timely roadmap for founders and marketers, highlighting the most crucial levers for sustainable scale in India's evolving startup landscape.