Bengaluru

What it is

Bengaluru is the capital of India's Karnataka state and the country's primary hub for software development, venture-backed startups, and global technology R&D. A city of roughly 14 million people, it hosts the Indian headquarters of most major US technology companies alongside domestically founded firms such as Infosys and Wipro. Its startup ecosystem is valued at US$153 billion (Startup Genome, H2 2023 to 2025), ranking #15 globally and #6 in Asia. Bengaluru captures roughly 46% of all venture capital invested in Indian startups and 58% of India's AI startup funding, making it the effective centre of gravity for South and Southeast Asian technology investment.

History

Bengaluru's technology identity predates the software boom by decades. The Indian government placed Hindustan Aeronautics Limited (HAL) here in the 1940s and the Indian Space Research Organisation (ISRO) in the 1960s, creating an engineering talent base that later seeded civilian software. Texas Instruments opened India's first offshore software development centre in Bengaluru in 1985. That decision drew Infosys (founded 1981) and Wipro's software arm into a cluster that expanded rapidly after India's 1991 economic liberalisation. The first internet-era breakouts, Flipkart in e-commerce and InMobi in mobile advertising, both founded in 2007, confirmed Bengaluru as the natural address for India's startup generation. Karnataka formalised the city's Kannada-language name in November 2006, replacing the colonial-era anglicisation "Bangalore."

Current state

As of mid-2026, Bengaluru hosts 13,649 DPIIT-recognised startups and roughly 30 active unicorns, more than any other Indian city. India counted 131 unicorns as of June 2026, and three of that year's five new entrants, including Sarvam AI at a US$1.5 billion valuation, are Bengaluru-based. The CRED-Meta deal of June 2026, a US$900 million investment at a US$4.5 billion post-money valuation, confirmed the city's weight in India's highest-valued consumer technology. Karnataka's Startup Policy 2025-2030 commits INR 518 crore to generating 25,000 new Karnataka startups by 2030. DPIIT data shows startups in the Bengaluru district had created 163,345 direct jobs as of October 2024.

Relationships

Bengaluru's capital and talent flows are tightly linked to Silicon Valley through returnee founders and India-based arms of US venture funds such as Peak XV Partners (formerly Sequoia India) and Accel, which conduct most of their South Asia investing from the city. Large US companies, Google, Microsoft, and Amazon among them, run significant R&D centres in Bengaluru, creating a talent market that competes with domestic startups for engineers. The Reserve Bank of India's data-localisation rules and the Securities and Exchange Board of India's startup-listing framework constrain how Bengaluru companies raise and structure capital. Karnataka's state government and India's central Ministry of Electronics and Information Technology both run overlapping incentive schemes, and the two sometimes compete on terms. A substantial Indian diaspora in the United States recycles capital and experienced operational leadership back into the ecosystem.

What to watch

Karnataka's plan to spread startup activity beyond Bengaluru, with INR 518 crore targeting Mysuru, Mangaluru, and Hubballi-Dharwad, will test whether the city's capital density and network effects are genuinely portable. India's sovereign-AI push, led by Bengaluru-founded companies, will determine whether the city becomes a foundation-model exporter or remains primarily a services and application layer. US export controls on AI chips and models, which tightened through 2025 and into 2026, are simultaneously a risk and an opening: restricted access to frontier US models pushes Indian firms to develop domestically, concentrating AI R&D spending in Bengaluru. The pace of profitable exits from India's 131-unicorn pipeline will shape global investor appetite for India allocations over the next several years.