Serverless technology allows developers to build and run applications and services without having to manage infrastructure. It provides a more flexible and cost-effective way for startups to build applications by allowing them to pay only for resources used and avoiding costs of idle servers. Serverless computing abstracts away server management, offers automatic scaling, and helps startups build applications faster while reducing costs and improving user experience. Major cloud providers like AWS Lambda, Azure Functions, and Google Cloud Functions provide serverless computing services.