India’s first GenAI unicorn shifts to cloud services as AI model ambitions face reality

Krutrim, India’s first GenAI unicorn, is shifting from AI model development to cloud services after months of relative quiet on product updates — a move that reflects the tougher economics of building large-scale AI systems. On Tuesday, Krutrim said it was moving toward cloud services, adding that the shift follows a business overhaul in late 2025 that included reallocating capital and talent and pausing chip design efforts. The update comes more than a year after the Bengaluru-based startup released its Krutrim-2 base model. The move follows a period of limited public activity from Krutrim, which has not made any significant product announcements in recent months, with its last post on X dating back to December. The startup did not appear in any of the sessions at India’s AI Impact Summit in New Delhi, where global players such as Anthropic, Google, and OpenAI took part. In contrast, rival Sarvam participated in multiple sessions at the six-day AI event, where it showcased new open-source models , hardware developments, and commercial partnerships . The changes also come after a series of layoffs at Krutrim over the past year, with more than 200 roles cut across multiple rounds, according to local media reports. The startup pulled its Kruti AI assistant app from app stores in April. …