Purpose This study aims to analyze the impact of artificial intelligence (AI) on business innovation in Indian startups across multiple sectors, including Fintech, Healthcare, Retail, Manufacturing and EdTech. By employing a sector-specific approach, the research aims to evaluate how AI adoption promotes innovation, enhances competitive advantage and contributes to improved business performance. Design/methodology/approach The quantitative study uses Structural Equation Modeling for empirical validation. A cross-sectional survey was done among 279 Indian company founders, managers and AI leaders. Data was collected using stratified sampling to represent Fintech, Healthcare, Retail, Manufacturing and EdTech. We collected responses using online questionnaires and organized interviews. AI adoption, innovation and commercial success are quantified. Findings The study expects to show that AI adoption boosts business innovation, enhancing product, process and business model advancements. AI-driven startups likely gain competitive advantages through improved innovation capabilities and digital readiness. Findings may confirm AI’s varied impact across industries, with Fintech and Healthcare leading in adoption, while Manufacturing and EdTech exhibit emerging trends. Research limitations/implications The study focuses on Indian startups, limiting the generalizability to other regions. Data is collected at a single point in time, which may not capture long-term AI adoption effects. Future research should explore longitudinal studies and global comparisons to enhance applicability. Originality/value As the analysis is based on the Resource-Based View, Disruptive Innovation Theory and Dynamic Capabilities Theory, this research demonstrates the impact of AI on business innovation and the advantages of Indian startups, using real-world examples. The knowledge provided will enable policymakers and strategists to maximize their use of AI for ongoing growth and competitiveness.
Singh et al. (2025) studied this question.
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