upGrad sets aside INR 100 crore for AI incubator and backs tutoring startup ZuAI

Mumbai-based online learning company upGrad launched the upGrad AI Incubator on February 27, 2025, allocating INR 100 crore to seed capital and infrastructure for early-stage artificial intelligence startups. Its first investment went to ZuAI, a Bengaluru startup building an AI personal tutor that students can use at any hour of the day. The size of the ZuAI investment was not disclosed, and the company did not name the other startups it expected to support through the new program.

According to Entrepreneur India, the incubator targets startups working on AI for education and workforce development. Areas named in the announcement included personalized learning paths, adaptive tutoring models and assessment tools intended to reduce test fatigue and make AI more useful in real-world settings. upGrad said it planned to back five to six AI startups over the following months, and it also wants to support plug-and-play AI tools that companies in other industries can adopt.

The company said it would take minority stakes in the startups it backs, leaving founders free to run their businesses independently. Alongside capital, the INR 100 crore allocation covers infrastructure for companies at the earliest stage of development. The report did not give the planned size of individual investments. Co-founder and chairperson Ronnie Screwvala described AI ability as a basic skill rather than an occasional program, according to the report.

The launch followed partnerships that upGrad had formed with industry and government bodies to train more than one million learners in AI skills and to set up AI centers of excellence across India. Founded in 2015, upGrad describes itself as one of Asia's largest integrated learning, skilling and workforce development platforms, and Entrepreneur India described it as an edtech unicorn at the time of the launch. Screwvala also presented the incubator as a way for India to lead the shift to AI rather than follow it.