India DevInfra Report 2025 - "AI eats Software"

by Grayscale Ventures

Are software infrastructure ("DevInfra") companies starting to re-grow or do they still focus on profitability and revenue efficiency? How are the public market valuations changing for these companies? How are investors - both public and private - thinking about Infra? Is India the next in line to benefit from the rise of DevInfra?

If these questions peek your interest, keep reading on and download our full report here.

Public Markets

At Grayscale Ventures we continuously monitor US-listed Public DevInfra companies, analyse trends, and identify gaps where startups can build. We further hone into what growth stratgies are working for these companies. This is why we created the Grayscale Infrastructure Index ("GII").

In 2025, GII continues to outperform EMCLOUD by almost 70%! Why you ask? We believe it boils down to:
(1) Stickiness of Infrastructure
(2) Demand for AI .

Stickiness - GII companies have a unique characteristic of being highly sticky within tech stacks, resulting in a Median Net Revenue Retention of 112%. Our research also finds that companies have grown ~27% in the last 10 years - primarily driven by this high retention rate.

AI - While revenue growth overall slowed down in recent years, Data Infrastructure continued to grow at 26%, because of new index entrants such as Rubrik and C3. Meanwhile companies like Snowflake continue to grow strong with the increased demand for data in the AI age.

Even as these tailwinds propelled GII companies beyond $42B in revenue in 2024, three growth strategies are consistently emerging from these companies:

1. Platform Approach - companies such as Gitlab and Datadog have shown that taking a platform approach towards a market segment is helping them go deeper into existing accounts by showcasing cost savings and sales efficiency
2. Data Management for AI - meanwhile the AI wave is bringing back Data front and center for enterprises - requiring adoption and purchase of new data products
3. Channel Partnerships - companies such as Rubrik in this vertical are heavily reliant on channel partnerships and alliances, from Hyperscalers that continue to bring enterprises on cloud to System integrators who acts as sales and implementation partners

Private Markets

Analysing the recent YC batches, we see almost 70% overlap between AI and Engineering, Product and Design and Infrastructure categories. Other Seed investors are following suit with two kind of companies emerging at the confluence of AI and Infrastructure:

1. AI for Infrastructure - Trained on enormous amounts of code, AI agents are creeping into the entire dev workflow throughout the application and cloud infrastructure stack - across Coding, Deployment, and Testing
2. Infrastructure for AI - Meanwhile, a new stack is starting to emerge to host and enable Agentic workflows split across Data, Planning and Action

India

What does all this activity mean for India?

India has no shortage of high-quality technical tertiary institutions, but the real strength of Indian developers is seen in handling infrastructure at scale for a population of 1.4B people. By virtue of its size and education, India already has the right talent pool to compete against global DevInfra market incumbents.

This year, our Grayscale India Private Index had to be expanded from 30 companies to 40 companies, assembling the new Grayscale Top 40 which tracks revenue performance of Indian DevInfra startups across stages. More than 30 startups surpassed the $1M revenue mark in 2024, whilst 6 out of the 40 startups maintained $100M+ in revenue. Together, these companies crossed $1.5B in revenue in 2024.

VC investments also surged in 2024 to ~$600M, but continued to lag significantly behind the US peers, showcasing a lucrative opportunity for global growth investors to tap onto these companies.

Grayscale Ventures truly believes in the immense potential of DevInfra in India - even more so in the AI age. We aim to be "Day-0" partners with product-led founders building global Software Infrastructure from India. If you are a founder building in this space, please contact us at [email protected].