Fashion tech firms struggle for funding fit

A few players are showing promise by combining AI with commerce

- Rwit Ghosh [e-mail]

Despite early excitement, India’s fashion tech sector has yet to deliver meaningful scale or investor returns.

Most startups remain at seed stage, struggling to move beyond experimentation with artificial intelligence (AI)-driven tools such as virtual try-ons, stylists and aggregators. A few players are showing promise by combining AI with commerce, but the market remains fragmented and capital-shy.

Investors see potential in AI-led discovery and personalization, yet question whether these innovations can overcome the supply chain, funding and scale challenges that have long plagued fashion startups in India.

Of the top 50 fashion tech startups in India, only one has reached a Series B funding round, one has been acquired, just three have reached a Series A cheque, while 35 have raised seed funding, according to data from startup intelligence platform Tracxn. The others remain unfunded.

However, investors are keeping an eye out for startups at the confluence of fashion and AI, while larger consumer tech firms are making play in the space.