2 April 2020
Indian Startups that Failed in 2019

    About 90% of startups fail within the first five years. Though India has the 3rd largest startup ecosystem in the world with several excellent business models and brilliant ideas, 4 out of 5 Indian startups fail due to lack of a scalable business model, lack of capital and wrong operation.

  •   Doodhwala


    Bengaluru-based Doodhwala was founded in 2015 by Aakash Agarwal and Ebrahim Akbari. Doodhwala, the hyperlocal delivery platform worked on a subscription model to deliver milk and groceries directly to your doorsteps.

    The subscription-based milk delivery platform claimed to deliver more than 30,000 litres of milk every day. All that, before 7 am in Bengaluru, Pune, and Hyderabad. Founders claimed to maintain a steady month-on-month growth rate with 85% plus customer retention. In October 2019, Startup announced in an email that the startup's rival, Bengaluru-based meat delivery platform FreshtoHome, would be taking over its delivery operations.

    Reason of Failure :   One of the biggest challenges facing Doodhwala was the presence of dominent players like BigBasket, who were absorbing smaller players in the given segment. BigBasket had consumed Pune-based RainCan and Bengaluru-based Morningcart for its micro-delivery service BBDaily. Other Players in the market like Milkbasket and Dailyninja were also targeting same set of customers.

    Major reason that led to shutdown of startup is failure to raise subsequent funding to finance its operations. Thus, making it difficult to sustain on its own.

  •   Koinex


    Mumbai-based Koinex was founded by IIT and BITS graduates Rahul Raj, Rakesh Yadav, and Aditya Naik in 2017. Koinex positioned itself as India’s largest cryptocurrency exchange company that maintained a high standard of service in trading of digital assets.

    Koinex made crypto-trading easier and accessible. It enabled the real-time trading of multiple crypto currencies including Bitcoin, Ethereum, Ripple, Litecoin, and Bitcoin Cash on a single web platform. The startup's revenue model was based on a nominal trade fee charged on the Indian rupee value of orders placed on its platform. As per Koinex’s site, there were over a million registered users, over 3 Billion Dollars of Trade volume, and over 20 million orders executed before they closed.

    Reason of Failure :   Major reason that led to shutdown of Koinex was multiple delays by the government agencies in clarifying the regulatory framework for cryptocurrencies in India. Thus resulting in shut down of startup in June 2019.

    The crypto exchange was also facing denials in payment services from payment gateways, along with blocking of transactions for the trading of digital assets.

  •   RUSSSH


    Founded in 2012 by Bharat Ahirwar, Russsh was an on-demand delivery service offering first mile and last mile solutions to individuals and businesses. Russsh started its journey as GetMyPeon and was the only errand-running and delivery service in Mumbai.

    RUSSSH claims to have completed 5 lakhs tasks and claimed to have a database of over 50,000 loyal clients by the time it went down. Its delivery fleet consists of 60-80 executives at any given time. Around 150 tasks were processed daily with an average task fee of Rs 300 and could go up to Rs 1,500 depending on the location, travel time, value of content to be delivered etc.

    Reason of Failure :   Major reason that led to shutdown of Startup was lack of capital to offer heavy discounts against competitors. Thus resulting in shut down of startup in June 2019.

    Commenting on the reasons for the shutdown, founder Bharat Ahirwar said some of the reasons to surrender were the inabilities to get the right team onboard and to raise funding. It is difficult when a company is run by a single founder.

  •   Doctalk


    Founded in 2016 by Krishna Chaitanya Aluru, Akshat Goenka and Vamsee Chamakura, Doctalk was started as an app to connect Doctors with patients. Through Doctalk, you could send messages to your doctor, store medical files, get detailed prescriptions, save your medications etc.

    Doctalk was started to solve problem of patient follow up and calls. Krishna Chaitanya Aluru built an electronic medical record (EMR) solution, which helped doctors write prescriptions digitally and provide customized prescription templates. Doctalk had raised roughly $5 million from Matrix Partners and Khosla Ventures and was also backed by Y Combinator, Vy Capital, Liquid2Ventures, Venture Highway, Altair Capital, and some angel investors.

    Reason of Failure :   Major reason that led to shutdown of Startup was its inability to pivot which meant it did not have a plan B in case it’s initial business model did not succeed. Thus resulting in shut down of startup in June 2019.

  •   LoanMeet


    Founded in 2016 by Sunil Kumar and Ritesh Singh, LoanMeet used to finance working capital requirement, B2B marketplace financing, cash credit line, and channel financing in the range of Rs 5,000 to 5 lakh for short term period ranging from 15 days to 9 months. Its average ticket size was Rs 50,000, with almost 18 percent interest rate.

    LoanMeet comes into existence after Sunil Kumar realised the problem that a large section of borrowers could not get personal and business loans from banks and other financial institutions due to lack of credit history, insufficient documentation, or other reasons.

    Reason of Failure :   Major reason that led to shutdown of Startup was failure to raise more capital to sustain the competition. Thus resulting in shut down of startup in May 2019.

    Though startup was successful in raising initial seed funding from Chinese investors and entrepreneurs Cao Yibin and Huang Wei, and Madhusudan, CEO of KrazyBee, it failed to convince investors for further financing as lending enabling market has been overcrowded with several deep-pocket players.

  •   Wooplr


    Founded in 2013 by Arjun Zachariah, Soumen Sarkar, Ankit Sabhrawal, and Praveen Rajaretnam, Wooplr is a Bengaluru-based local shopping and social discovery application that allows people to recommend their favorite products and stores in that city. It helps you discover trends and more in fashion, decor and food, based on your location, interests, occasion and social circle.

    Reason of Failure :   Major reason that led to shutdown of Startup backed by Sistema Asia Fund, Astarc Ventures, and Helion Venture Partners, was failure to find further investments. Thus resulting in shut down of startup in May 2019.

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