In 2024, a series of high-profile startup shutdowns in India served as a wake-up call for the country’s evolving startup ecosystem. The closures were not merely a sign of failure but highlighted the underlying challenges that many young ventures face while striving to carve out a space in an increasingly competitive and complex market. This article will take an in-depth look at the factors leading to the closure of several prominent startups in 2024, including Bluelearn, GoldPe, Greenikk, Inshurst.ai, Investmint, Kenko Health, Koo, Muvin, My Tirth India, Nintee, Stoa, and Toplyne. Each of these companies made significant contributions to their respective industries but ultimately faced insurmountable obstacles that led to their downfall.
The Story of Bluelearn: A Cautionary Tale in the EdTech Sector
Bluelearn, an edtech startup founded by Harish Uthayakumar and Shreyansh Sancheti in 2021, quickly gained attention for its innovative approach to community-driven learning. Initially operating as a Telegram channel where students could ask academic queries and help each other, Bluelearn grew rapidly to a community of over 1.5 lakh students across 5,500 colleges in 20+ countries. The platform raised approximately $3.95 million in funding from notable investors like Elevation Capital and Lightspeed.
However, despite its initial success and large user base, Bluelearn faced significant challenges when it came to monetizing its platform. Converting a community-based platform into a sustainable business model proved difficult. The company struggled to find product-market fit, and scaling its operations proved to be even more challenging. The failure to monetize, combined with the inability to turn engagement into profit, ultimately led to the closure of Bluelearn in July 2024. This case underscores the importance of finding the right balance between growth and business sustainability, especially in a sector like edtech, where competition is fierce and customer loyalty is hard to secure.
GoldPe: The Struggles of a Fintech Startup with a Flawed Business Model
GoldPe, a fintech startup founded in 2023 by Parth Shah and Yagnik Raolji, entered the market with an innovative approach—allowing users to invest in digital gold while also participating in prize-linked savings plans. The company raised INR 71 lakh in seed funding from 100X.VC and a group of angel investors, and initially gained traction with its unique model.
Despite attracting 2.25 lakh users, GoldPe struggled with a significant flaw in its business model: the reliance on prize-linked savings that consumed a third of its revenue. This model, although innovative, was not sustainable in the long term. With revenue of only INR 1.5 lakh against operational costs and prize draws, the company was unable to scale effectively. The failure to generate a solid revenue stream and secure further funding led to GoldPe’s shutdown in 2024. This incident highlights the critical importance of having a sustainable, well-thought-out business model, especially in the highly competitive fintech space, where profitability is paramount.
Greenikk: Challenges in the Agritech Sector
Greenikk, an agritech startup founded in 2020 by Fariq Naushad and Previn Jacob, aimed to support banana farmers with a digital platform offering services such as financing, crop advisory, insurance, and market connections. Despite raising INR 8.4 crore in funding from 100Unicorns, Greenikk struggled with several operational challenges, most notably loan defaults by farmers, which severely affected its financial stability.
Initially, Greenikk focused on creating a comprehensive ecosystem around banana farming, but it soon became clear that the niche market was difficult to scale. As the company found it challenging to expand beyond its financial services, the inability to establish a broader, more diversified product offering led to its eventual shutdown in September 2024. Greenikk’s failure illustrates the challenges agritech startups face, especially when dealing with smallholder farmers who often struggle with financial stability. It also underscores the difficulty of scaling in a sector that requires high levels of trust and understanding of local dynamics.
Inshurst.ai: The Struggles of an AI Startup in a Conservative Industry
Inshurst.ai, a generative AI startup founded in 2022, aimed to revolutionize the insurance industry by providing AI-driven infrastructure to help professionals with tasks such as product searches, compliance research, and underwriting. Despite its innovative approach, Inshurst.ai faced significant hurdles in scaling its business. The highly conservative and regulated nature of the insurance industry made it difficult for the company to gain traction, and customer acquisition remained slow.
The company struggled to adapt its offerings to the specific needs of the industry, and despite its promise, it failed to secure additional funding. After just over a year of operations, Inshurst.ai shut down in September 2024. This closure reflects the difficulties faced by generative AI startups, particularly those attempting to enter traditional industries that are slow to adopt new technologies and face numerous regulatory challenges.
Investmint: A Fintech Startup That Couldn’t Differentiate Itself
Investmint, founded in 2022 by Aakash Goel and Mohit Chitlangia, was a fintech startup that aimed to help users make informed investment decisions using data-driven signals. The company raised $2 million in seed funding from Nexus Venture Partners but struggled to establish a clear product-market fit. Despite offering useful tools for wealth management, Investmint found it difficult to differentiate itself from well-established players in the space.
The company’s inability to scale and engage users effectively led to its downfall. The closure of Investmint in 2024 serves as a reminder of the fierce competition in the fintech space and the importance of offering a unique value proposition to stand out. In a sector where customers have many options, startups must develop products that provide clear, differentiated benefits.
Kenko Health: A Health-Tech Startup Stifled by Regulatory Hurdles
Kenko Health, a health-tech company that provided subscription-based healthcare services, raised significant funding and initially garnered attention with its innovative approach. The startup, founded in 2019, aimed to offer affordable OPD benefits, medicines, and other healthcare products to customers. However, Kenko Health faced a major setback when it couldn’t secure the necessary insurance licenses from the Insurance Regulatory and Development Authority of India (IRDAI).
Despite rapid revenue growth—from INR 5 crore in FY22 to INR 85 crore in FY23—Kenko Health’s failure to navigate the regulatory complexities of the health-tech industry led to its shutdown in August 2024. The company’s closure underscores the importance of regulatory compliance in sectors like health-tech, where stringent regulations and licensing requirements can make or break a startup.
Koo: The Indian Alternative to Twitter Faces Stiff Competition
Koo, the Indian microblogging platform founded in 2020, initially gained significant attention for positioning itself as a regional-language alternative to Twitter. Despite raising over $50 million from investors like Tiger Global, Accel, and Blume Ventures, Koo faced significant challenges in competing with Twitter and other global giants. User engagement and retention were persistent issues, and the platform’s growth plateaued after an initial surge.
The inability to raise a Series C round and the mounting losses led to Koo’s closure in 2024. Despite its initial promise, Koo’s failure highlights the difficulties homegrown alternatives face when trying to compete with global incumbents who have established user bases and significant resources.
Muvin: Regulatory Challenges Derail a Promising Neobanking Platform
Muvin, a youth-focused neobanking platform, shut down in 2024 after a ban by the Reserve Bank of India (RBI) on co-branding arrangements for UPI. The platform, which had partnered with Livquik, a non-bank PPI issuer, to offer co-branded prepaid cards to students, found itself in a regulatory bind when RBI issued a directive prohibiting such partnerships.
Despite raising $4 million from WaterBridge Ventures, Muvin could not recover from the regulatory challenges and was forced to shut down. The Muvin case underscores the difficulties fintech startups face in India, where navigating complex and evolving regulatory landscapes is critical to success.
My Tirth India: A Spiritual Startup Hits Financial Roadblocks
My Tirth India, a spiritual-tech startup founded in 2019 by Indraneel Dasgupta, aimed to provide a one-stop solution for pilgrims, offering services such as travel loans, online pooja, prasad delivery, and astrology. Despite initial traction, the startup struggled to secure the necessary funds to continue its operations after the death of its principal investor. Financial difficulties, combined with an inability to scale its operations effectively, led to My Tirth India’s closure in 2024.
This case highlights the risks associated with startups that rely heavily on a single investor and the challenges of scaling in niche sectors like spiritual tourism.
Nintee: AI-powered Personal Development Platform Fails to Retain Users
Nintee, an AI-powered personal development platform founded by Paras Chopra, aimed to offer personalized growth tools to users. Despite raising $3 million in funding, the platform faced significant challenges in retaining users and scaling effectively. Nintee failed to maintain its initial momentum, and the company eventually decided to shut down in 2024. This closure highlights the difficulty of building a user-centric product in the crowded AI space, where user engagement and retention are critical.
Stoa: The Fall of an Alternative MBA Provider
Stoa, an ed-tech company offering alternative MBA programs, targeted working professionals who wanted to pursue an affordable MBA without leaving their jobs. Despite raising $1.5 million in seed funding and serving over 1,500 students, Stoa struggled to expand its reach and scale its offline operations. Competition from established players like Masters’ Union and other ed-tech startups contributed to its downfall. Stoa’s closure in November 2024 highlights the intense competition in the ed-tech space and the challenges of differentiating in a crowded market.
Toplyne: A SaaS Startup Fails to Gain Traction
Toplyne, a SaaS startup focused on helping businesses optimize their revenue through data-driven decision-making, shut down in 2024 due to challenges in scaling and gaining customer traction. Despite its initial promise, Toplyne faced difficulties in differentiating itself from other SaaS products in the market and struggled to acquire a significant user base. As a result, the company decided to shut down its operations and return capital to its investors.
Conclusion: The Importance of Adaptability and Sustainable Business Models
The shutdowns of these 12 startups in 2024 serve as a sobering reminder of the challenges faced by young businesses in India’s startup ecosystem. While each of these companies had the potential for success, they ultimately fell short due to a combination of factors, including poor product-market fit, regulatory hurdles, competition, financial instability, and ineffective business models.
For future entrepreneurs, these closures offer valuable lessons: the importance of a clear and sustainable business model, the need for regulatory compliance, the significance of user engagement and retention, and the ability to adapt to market changes. While failure is an inevitable part of entrepreneurship, learning from the mistakes of these startups can help future ventures avoid similar pitfalls and thrive in the ever-changing landscape of the startup world.
