Krutrim, the artificial intelligence startup co-founded by Bhavish Aggarwal of Ola Electric, has laid off approximately 100 employees in its latest round of downsizing. The majority of those impacted were from the linguistics team, which was focused on building multilingual capabilities across Indian languages.
This marks the company’s second round of layoffs, following a smaller workforce reduction in June 2025. The move is seen as part of an internal restructuring initiative aimed at streamlining operations and enhancing agility. It comes shortly after the debut of Kruti, Krutrim’s voice-first AI assistant tailored for the Indian market.
Linguists working across ten regional languages were affected, raising questions about the long-term viability of developing large-scale Indian language models in a highly competitive and capital-intensive AI sector. Many of the laid-off employees had recently relocated to Bengaluru as part of Krutrim’s expansion.
Sources indicate the layoffs were prompted by two major hurdles: delays in securing fresh funding and a lukewarm user response to the product. Despite achieving unicorn status in 2024 after a $50 million investment from Z47 Partners, Krutrim’s fundraising efforts have reportedly lost momentum. The company had set an ambitious goal to raise $1.15 billion by 2026, with plans to invest $230 million in 2025 alone.
As Krutrim seeks to establish a unique position within India’s rapidly evolving AI ecosystem, it continues to develop tools like BharatBench, designed to benchmark AI model performance across Indian languages.
Get it on Play Store