11 Indian Startups that shut operations in 2018

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Institute for Business Value and Oxford Economics conducted a survey which depicted that 90 per cent of Indian startups fails within the very first five years of inception, Forbes published in a report. Despite being the third largest startup ecosystem in the world, 9 out of 10 Indian startups fail due to the absence of a scalable business model, lack of funding and improper execution.

Indian startup ecosystem witnessed a 108 per cent overall growth in the total amount of funding from $2 billion in 2017 to $4.2 billion this year, as per NASSCOM. However, there is a steep decline in the amount of funding raised at the seed stage. The Indian startup ecosystem raised a total of around ₹3,800 crores ($535.68 million) in November 2018.

Failure is hard and depressing but it teaches us a lot. If you are a founder and want to save ruining your startup finance, read this post to get some ideas. Many startup founders focus on PR after raising funds. If you too have recently raised funds, or are planning to raise it in future, this post will help you.

We at Startup Wonders have compiled a list of some of the prominent startups that failed in 2018 to give an ultra insight into the reasons for their failures. You must learn through the failures of these startups and apply the learnings to your business.

11 Failed Indian Startups 2018

Just Buy Live

Founded in 2015 by Bharat Belachandra and Sahil Sani, the startup offered a marketplace that connected retailers to buy goods directly from brands across multiple segments including personal care, auto, electronics, fashion and FMCG. Additionally, the startup also forayed into the micro-lending space and offered unsecured credit to small and medium enterprises. In August 2017, Dubai-based Ali Cloud Investment led a $100 million funding in the startup.

Founder – Bharat Belachandra, Sahil Sani
Founded – 2015
Category –
e-Commerce
Total Funding –
$120 million
Headquarters –
Mumbai

The Reason for Failure – There are two major reasons for the failure of Just Buy Live. The first being negative cash flow and the second being an unscalable business model. However, the founders spoke to Entrackr and claimed that the startup has shut its operations temporarily and will soon restart its business. The website of the startup was down at the time of writing this article.

Shotang

Founded by Anter Virk and Anish Basu Roy in 2013, Shotang was a B2B marketplace for retailers, distributors and manufacturers. It enabled them to discover and transact online and catered to mobile and apparel categories. The source of revenue was from the commissions charged from distributors per transaction.

Founder – Anter Virk, Anish Basu Roy
Founded – 2013
Category –
e-Commerce
Total Funding –
$6.2 million
Headquarters –
Bengaluru

The Reason for Failure – Amidst the fierce competition from Flipkart, Amazon and Paytm Mall, the business was forced to scale down its operations. Though it raised $6.2 million in funding from investors like Patamer Capital and Exfinity Venture Partners, the money was used to pay off creditors, employees and partners. The startup tried hard but failed to solve the unit economics.

PortDesk

Founded by Pushpit Pallav in 2014, PortDesk was a logistics startup which provided an e-procurement software solution for logistics management. It catered to port-related operations such as accounting, ports DA estimate and voyage, cash management as well as layout and contract management. It was headquartered in Noida.

Founder – Pushpit Pallav
Founded –
2014
Category –
Logistics
Total Funding –
$2 million
Headquarters –
Noida

The Reason for Failure – Although it raised $2 million in funding from a Singapore-based firm Alphard Maritime Group, the startup shut down its operations only a year after the cash infusion. The real reason behind the operational shutdown is still unknown. We tried reaching the founder but was unable to get him to comment on the matter.

Zebpay India

Founded by Saurabh Agarwal, Sandeep Goenka and Mahin Gupta in 2014, Zebpay was one of the leading digital currency exchanges in India. It allowed users to buy, sell and exchange cryptocurrencies like Bitcoin, Bitcoin Cash, Ethereum, Litecoin and Ripple. The website catered to more than 3 million users in India.

Founder – Saurabh Agarwal, Sandeep Goenka, Mahin Gupta
Founded – 2014
Category –
Fintech, Cryptocurrency
Total Funding –
$1 million
Headquarters –
Ahmedabad

The Reason for Failure – The startup shut down its operations after RBI issued a circular on 6th of April, 2018. The circular restricted banks from extending any services to crypto related companies. Due to the lack of crypto rules and regulations in the country, Zebpay was unable to find a way to carry on the business. The exchange, however, still allow users to deposit and withdraw coins but have restricted depositing and withdrawing fiat currencies.

BabyBerry

Founded by Bala Venkatachalam, Dev Vig and Subhashini Subramaniam in 2014, BabyBerry was a health tech startup which operated an online parenting app. The app helped parents of infants to provide the best care to their children. Features like digital vaccination chart, reminders, health records management and access to nearest doctors were some of the features that the startup boasted about.

Founder – Bala Venkatachalam, Dev Vig, Subhashini Subramaniam
Founded – 2014
Category –
Healthtech
Total Funding –
$1 million
Headquarters –
Bengaluru

The Reason for Failure – While we don’t exactly know what led BabyBerry to close its shop. Since October last year, the website of the startup is down and the firm has now posted anything on its social media. However, In August this year, a report cited its founder explaining that the startup is working on to solve some technical errors. The startup has raised a total of $1 million in funding till date.

MrNeeds

Founded by Hitashi Garg, Ravi Wadhwa, Ravi Verma and Yogesh Garg in 2014, the startup offered an online subscription-based hyperlocal delivery of products like milk, bread, eggs and various other grocery items. The startup had a client base of 9,000 families across Noida and was processing 36,000 orders every month. The startup boasted about a terrific reduction in delivery costs to 50 per cent and lower.

Founder – Hitashi Garg, Ravi Wadhwa, Ravi Verma, Yogesh Garg
Founded – 2016
Category –
Consumer Services
Total Funding –
$500,000
Headquarters –
Noida

The Reason for Failure – We are not sure why the startup pulled of its mobile application from the Google Play Store. The website is also down. However, we speculated that due to the hefty competition from heavily funded startups like BigBasket, DailyNinja and Grofers, the startup was unable to cope up with its little $500,000 funds.

Tazzo Technologies

Founded by Priyam Saraswat, Shivangi Srivastava, Priyank Suthar and Vikrant Gosain, Tazzo was one of India’s earliest bike rental startup focused on providing point-to-point commute service via a fleet of bikes. The startup charged INR 5 per kilometre and the mobile application used GPS to track the real-time movement of its entire fleet including theft and overspeeding.

Founder – Priyam Saraswat, Shivangi Srivastava, Priyank Suthar, Vikrant Gosain
Founded – 2014
Category –
Transport
Total Funding –
$225,000
Headquarters –
Bengaluru

The Reason for Failure – Tazzo raised around $225,000 in seed funding from DSG Consumer Partners in October 2016. However, the startup was in a need for more cash due to the capital-intensive business model. Despite a lot of efforts, the startup was unable to secure more funding and was forced to halt its operations in September this year.

Ezytruk

Founded by Srikanth M and Narasimha BS in 2015, the Bengaluru-based startup provided a trucks and logistics platform which connected carriers, shippers and original equipment manufacturers (OEMs). Ezytruk enabled systematic transportation of goods by offering services including price comparison between carriers, warehouse space management and real-time information of the movement.

Founder – Srikanth M, Narasimha BS
Founded – 2015
Category –
Logistics
Total Funding –
$147,000
Headquarters –
Bengaluru

The Reason for Failure – Ezytruk became another victim of lack of funding support and failed. Earlier in January 2017, the startup raised around $147,000 from Dubai-based angel investors Ajith Nair and Anish K. The lack of further capital infusion prevented the startup from scaling up its business and ultimately it shut down its operations this year.

Wydr

Founded by Devesh Rai G, Hitha Uchil and Varun Guru in 2015, Wydr was a B2B marketplace for wholesalers which provided product from categories like fashion, automotive and electronics. It catered to manufacturers, wholesalers and retailers. The sellers were able to customize their requirements, negotiate prices and crack the deal. The startup had a base of more than 10,000 manufacturers on its platform.

Founder – Devesh Rai G, Hitha Uchil, Varun Guru
Founded – 2015
Category –
e-Commerce
Total Funding –
Unknown
Headquarters –
Gurugram

The Reason for Failure – The exact reason for the shutdown of Wydr is unknown. Sandeep Agarwal, the founder of ShopClues, who also was an early investor in the startup, confirmed the operational shutdown of Wydr in November this year. Entrackr published a report which said that the company was scaling down for the past three months and finally pulled the plug a couple days ago.

Monkeybox

Founded by Sanjay Rao and Sandeep Kannambadi, the consumer-focused startup provided Recommended Dietary Allowance (approved vegetarian meals) for the 3-18 years old kids at school. Monkeybox supplied over 1,500 meals every day to more than 85 schools across Bengaluru and had more than 2,000 customers on its platform.

Founder – Sanjay Rao, Sandeep Kannambadi
Founded – 2015
Category –
Consumer Services
Total Funding –
Undisclosed
Headquarters –
Bengaluru

The Reason for Failure – The strong reason for Moneybox’s failure was the inability to generate the required revenue to stay cash positive. It was quite a surprise as the startup has gone forward acquiring other companies like food delivery firm 75 In A Box and juice delivery startup RawKing. However, amidst fierce competition, the startup temporarily terminated its service in March this year.

ContentMart

ContentMart was a marketplace that served as a wonderful platform not only for the authors and copywriters but also for those who are looking for the perfect wordsmiths. It was owned and operated by Creative Webmedia Private Limited, a Gurugram-based technology and internet company. It provided a marketplace where businesses can hire freelance content writers.

Founder – Sub Organization of Creative Webmedia Pvt. Ltd.
Founded – 2015
Category –
Internet
Total Funding –
Undisclosed
Headquarters –
Gurugram

The Reason for Failure – The startup failed due to lack of an efficient business model. ContentMart failed to generate enough revenues to sustain the operations. In August this year, the startup officially announced the operational shutdown. However, it is still allowing writers to connect with businesses and exchange contact if they wish to continue doing business offline.

Conclusion

More than 32 Indian startups have shut their operations down in the past three years. If you want to know about the startups that shut shop in 2016, you can read this article. Majority of the startups that failed belongs to the consumer services, e-commerce and fintech sectors. Despite these sectors receive a lot of attention and cash from investors, they tend to be riskier and capital intensive.

So, do you know about any other startup that failed in 2018? Let us know in comments. We will update the list and give a shoutout to you.

So, what are your thoughts on this story?
Tell us in the comments.

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