Indian AI startups are increasingly walking away from Indian enterprise clients, frustrated by a recurring pattern of unpaid proof-of-concept (PoC) requests, delayed decisions, and a lack of willingness to pay for early-stage innovation. 

The tipping point came earlier this month when Vaibhav Domkundwar, founder of Better Capital, posted on X (formerly Twitter): “AI founders finally skipping selling to Indian customers after doing PoCs after PoCs and then being requested for even more 'free' PoCs. There is a limit to this… Enough is enough.”— @vaibhavbetter

The post quickly went viral, sparking a wave of agreement from startup founders across India’s SaaS and AI ecosystem. Many echoed the sentiment that the domestic market, while often celebrated for its scale and growth potential, continues to drain the resources of early-stage companies without delivering real commercial outcomes.

Founders Speak Out

Navaneeth PK, founder of ToolJet, shared a personal experience that has become increasingly common in founder circles: “A customer came in 2023, took a detailed PoC, ghosted us, and came back months later asking for support—again, without commercial clarity.”
— @navaneethpk

Other founders cited similar concerns, ranging from endless delays and shifting goalposts to outright ghosting. For AI startups, which often incur significant infrastructure costs for even a basic PoC, these engagements represent not just a lost sale but a material threat to their financial runway. “PoCs without timeframes are a startup killer. They indicate the customer doesn’t know what they want. That’s not a partner. That’s a time sink,” said Naveen Varshneya, founder of Saanjh.ai.

The backlash has culminated in what many are calling the “Skip India” movement — a shift in go-to-market strategy where Indian startups are choosing to focus primarily on the U.S. and other global markets from day one. “If you’re a startup, absolutely sell to the US first. It’s rich, it’s fast, and it pays,” said one founder on X. 

“We’ve stopped doing PoCs for Indian companies. We're building for the US market now. It’s just better ROI on time, money, and morale,” said another.

The preference for global customers is not new, but the growing frustration with domestic enterprises marks a sharp shift in tone. Several founders say the PoC-first, payment-later approach in India stands in stark contrast to the U.S. market, where even pilot programs often come with clearly defined commercial terms and faster decision cycles.

Cultural Mismatch?

Some observers suggest that the underlying issue lies not with intent but with structure. Paras Chopra, founder of Wingify, noted that many Indian enterprise buyers “don’t want to buy” — instead, they engage startups to validate internal ideas or benchmark existing tools.

Others, such as Pratik Desai, founder of KissanAI, pointed to a deep-rooted risk aversion in Indian enterprise IT culture. “Even when your solution works perfectly, you're told: ‘Let’s pilot this in another location… then maybe we’ll consider a license.’ That cycle never ends.”

In many cases, middle managers within large enterprises are cited as the key bottlenecks. They are often unwilling to take ownership of startup deals that may be perceived as risky, leading to endless cycles of internal approvals or deferrals. “Most middle managers just want to please their bosses. So they delay. And delay. And delay,” said Naveen Katti, founder of Track2win.

While the consensus among early-stage AI founders leans toward skipping Indian clients altogether, not everyone agrees. Aakrit Vaish, co-founder of conversational AI startup Haptik, cautioned against writing off the Indian market entirely.

“If you treat Indian enterprises like your ticket to ultimately go to the US, expect the same short-sightedness from them. There's a massive TAM in India now. But it takes depth,” he said.

Vaish and others argue that India’s enterprise market has matured significantly in the last few years, and that success requires a different playbook — one rooted in relationship-building, patience, and sustained engagement. Similarly, Ritesh Kumar, founder of TranZact, said the key may lie in how startups frame PoCs.

“PoCs aren’t the problem. It’s how we treat them. Stop thinking of them as validation exercises. Think of them as collaboration opportunities. That mindset shift matters.”

A Structural Wake-Up Call

At its core, the debate around PoCs reflects deeper structural challenges in India’s startup ecosystem — including lack of procurement reform, inadequate incentives for innovation inside large companies, and a product culture still in the making. For many founders, the solution lies not in abandoning India altogether, but in setting firmer boundaries.

“The idea of ‘build for Bharat’ sounds great until you burn 3 months on unpaid PoCs and never hear back,” one founder posted. “At some point, you have to value your own time.”

The tension also reveals a growing maturity among Indian startups, especially in AI and SaaS. Founders are becoming less willing to accept ambiguity and more focused on building predictable, sustainable revenue streams — even if it means looking abroad.

As Indian enterprises embrace AI transformation, there is a growing need to revisit how they engage with early-stage innovators. Without clear commercial pathways and mutual respect, the very startups that could power India’s next tech leap may choose to grow elsewhere.

“Don’t be surprised when India’s best startups go global first,” Vaibhav Domkundwar wrote in his now widely shared post. “They’re not running away. They’re just tired of proving themselves for free.”

If India hopes to become a global AI hub, it may first need to fix how it treats its own innovators.