By Saritha Rai | Updated on Jun 12, 2026 at 10:53 AM
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A startup founded by a former banker has launched one of India’s first homegrown video AI platforms, wading into an arena dominated by US and Chinese services.
Bangalore-headquartered Avataar AI trotted out the open-weight Varya model this week, touting its affordability. The model can produce video at roughly 0.48 rupees ($0.005) per second by compressing the steps in video generation from 50 to just four, the startup said in a statement.
Avataar is targeting a market of more than 1.4 billion people where cost competitiveness is key, and rapid adoption may matter more than performance — at least initially. Its launch follows $55 million of funding from investors like Peak XV Partners and Tiger Global. Founder Sravanth Aluru is an alum of IIT Mumbai and Microsoft Corp. and was an investment banker at Deutsche Bank AG.
“We are 27x cheaper than comparable open source AI video models,” Aluru said in a phone interview.
Rather than retrofitting a generalized AI model for Indian audiences, Varya aims to render video true to the country’s clothing, food, festivals, homes and everyday settings. It’s an attempt to address what executives have long described as a failing in global models trained primarily on Western datasets.
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Video AI is a field in which US and Chinese players are racing ahead. Chinese video models like Kuaishou Technology’s Kling, ByteDance Ltd.’s Seedance and Alibaba Group Holding Ltd.’s Wan are pushing the frontiers of video quality, motion realism and audio generation.
Varya’s debut isn’t meant to compete with those head-on. Rather, it will focus on building a lean, more accessible model that can then be deployed at scale by businesses, public services and education and health-care companies.
It developed its model with support from the IndiaAI Mission, backed by the government.
Varya, as well as foundational AI models like ones launched by fellow AI developers Sarvam and BharatGen this year, reflect India’s attempt to provide subsidized compute infrastructure to drive its broader AI ambitions.