Startups have been mushrooming in every segment now! Starting of a new business, scaling up and close down has become a part of the startup ecosystem. In every segment, there are plenty of imitator business ideas that struggled hard to survive but eventually failed. If we just checkout 2016 data, bounty of startups opened and closed down in past eight months. A study done by Xeler8 revealed that in India nearly one in two startups failed to sustain.

Here is a list of some of these startups who failed and forced to shut down operations because of poor business strategies or may be of any other reason. Here you can go for a quick review below:

1. LazyLad

Hyperlocal grocery marketplace LazyLad closed down its B2C business operations and cut down a large part of its workforce in Feb 2016! It was offering services in northern region and has raised around Rs 3.18 crore in its pre-Series A round of funding from Jai Choi, Tekton Ventures’ Founder and Managing Partner, Japan-based Sugashita Partners’ Kiyohiro Sugashita, and Japanese venture capitalist Hirokazu.It was launched by II Tians Paresh Goel, Ajay Sethi and Saurabh Singla.

2. Delivree King

Delhi based Delivree King was founded in March 2015 by Neeraj Bisht and Akash Sharma. It was focusing on logistics and provided special offers with each of its delivered parcel from different e - commerce companies. It had funding issue and finally closed all business functions this year.

3. PepperTap

Once upon a time when PepperTap was known as India’s third-largest e-grocer, but it closed down its business operation in April 2016. The shutting down harmed employees as well as its sister concern logistic company NuvoEex - that has Snapdeal as a biggest customer. In the last month the number of processing orders was less and it forced managing team to take decision to close down the business operations. This startup was launched by Navneet and Millind Sharma in November 2014 and had raised funding in four rounds from Sequoia Capital, SAIF Partners, Snapdeal and others. It had also acquired another budding hyperlocal grocery marketplace – Jiffstore but all went in vain.

4. Fashionara

Bangalore based Fashionara, which was launched by former Reliance Trends CEO Arun Sirdeshmukh and Former Chief Technology Officer, Times Internet Ltd, Darpan Munjal in 2012 closed its business in May 2016. It has raised $4 million from Helion Venture Partners and Lightspeed Venture Partners and scaled business in apparel, accessories, and footwear segment.


Another hyperlocal on demand service provider, also closed down operations in June 2016. It was based in Nagpur and started by Jayesh Bagde in November 2014. It has raised an unknown amount of seed funding in July 2015 from Atulya Mittal, steel tycoon Lakshmi Mittal’s nephew but failed to tell the success tale.


Delhi-based e-grocery delivery service provider shut down its operation in the month of June. It was run by Asankhya Retail Pvt. Ltd and had raised an unidentified angel funding amount from a group of investors in June 2015. Saharawat , who worked with Shoppers Stop and HyperCITY earlier has launched this concept in November 2014 to deliver fresh daily essential things to the customers’ doorstep.

7. FranklyMe

Another name in the failed startups list is FranklyMe! It was a video micro-blogging website founded by Abhishek Gupta and Nikunj Jain in 2014. It has raised $600k seed funding from Matrix partners. In another round, it has received an undisclosed amount from undisclosed investors. Despite the fact that it has been a well funded company, it failed to capture the market attention and closed down all operations in Feb 2016.

8. Amber wellness

Amber Wellness, an online beauty services startup closed down its operation in May 2016. It was co-founded by Abhimanyu Dhamija, former Co-founder of and Saurabh Goel in August 2015. It has raised $1 million funding from unidentified angel investors and has also launched app but little traction and low margin forced to shut down operations.

9. Intelligent Interfaces

Another former Co-founder of and the bad boy of Indian Startup history, Rahul Yadav took decision to shut down his new startup Intelligent Interfaces in May 2016 right after funding announcement from Sachin Bansal, Binny Bansal and YouWeCan at a valuation of 173.0 crore in total. He had launched this idea with Azeem Zainubhai to make the Indian governance highly efficient by providing intelligent data aggregation and visualization solutions. Everybody was stunned when read Rahul Yadav’s Facebook update in which he had mentioned that Intelligent Interfaces not working out anymore.

10. Purple Squirrel

Purple Squirrel an EdTech financial startup baked by Matrix closed down business in May 2016. It was started by Aditya Gandhi and Sahiba Dhandania to hook up students with industry leaders and big companies for industrial exposure and training. It forced to close down because of poor business and fast cash burning.

11. ClassVerse

Delhi-based fitness startup ClassVerse closed its operations just after 10 months of its start. It was launched by Rukaiya Kanchwala, a former director of Jabong as a marketplace to provide access of health services to fitness lovers but failed to achieve unit economics. It was operating business in Mumbai and NCR areas.

12. ZuperMeal

Another shocking shut down was of ZuperMeal, a home delivery food venture backed by world famous chef Sanjeev Kapoor! It has closed its operations in May 2016 just after eight months of raising seed funds from celebrity chef Sanjeev Kapoor and Ravi Saxena. It has also raised undisclosed amount from overseas investors in October 2015 but could not survive for a long time period. It was started by Pallavi Saxena, Balasubramanian Anantha Narayanan and Prabhakar Banerjee to allow users pre-order food at nearby restaurants.

13. ITiffin

Another meal service provider iTiffin closed down operations in March 2016! It was based in Bangalore and started by Ryan Fernando and Tapan Kumar Das in 2013. Although it has raised $1 million seed funding from different investors but all went in vain as it could not survived for a long time period.

14. EazyMeals

Another failure was EazyMeals! It closed operations just after eight months of its start. Ravi Baranwal and Harshdeep Rapal launched this venture and has raised funding from Matrix Partners successfully but died early after that.

15. Zeppery

Zeppery, another restaurant pre-ordering app closed down its operations just after six months. It was founded by Lalit Vijay and Utkarsh Srivastava in 2015 and backed by Suyash Sharma with $77k funding amount. It closed down operations as it fail to retain its customers.

16. BiteClub

BiteClub was launched in 2014 by Aushim Krishan, Prateek Agarwal and Siddharth Sharma to connect consumers and home chefs via a mobile app and the website. Although investors including Powai Lake Ventures, growX ventures and a group of angels invested in BiteClub but it stepped back in May as it could not able to solve few problems.

17. Klozee

Klozee is another failure! Bangalore based platform was renting apparel and founded by Pratik Moona, Aman Haji, Prashant Jain in 2015.  It has raised undisclosed seed funding amount from Tracxn Labs and other investors but closed its operation because it failed to overpower the challenges in apparel rental space in India.


Delhi based AUTOnCAB took decision to shut down its operations as it failed to sustain its business because of unbendable competition from Uber and Ola who are heavily funded from investors. It was launched by Vinti Doshi and Aaditya Goyal in 2015 and stayed behind to crack any funding deal.

19. Zimply

Zimply is another startup that ended in Feb 2016 without mentioning any convincing reason! It was founded in 2014 by Karan Baweja, Ishaan Bhola and Viraj Verma to make online shopping of home decor easy. It has raised $510K funding amount from Matrix Partners and a group of Angel investors but now has closed its operations.

20. AskMe

AskMe, a Gurgaon-based online classified website announced to shut down its operations recently because of cash crunch as majority of investors exited! It was launched in 2010 and came out with new concept Askmebazaar - an online shopping portal in 2012.  Getit acquired AskMe from Network18 in 2013.

These are not only startups that closed operations in past eight months. Many others including GetNow (founded in 2014), Znapin (founded in 2013) and Flashdoor (founded in 2015) also closed operations in 2016. Apart from them, there could have more names to mention which became history now.

Besides, India's bilion dollar startups such as Flipkart and Ola closed its online grocer delivery services - Nearby and Ola Store respectively, this year. Grophers too closed its services in nine major tier-2 cities. In May 2016, TinyOwl, a restaurant food delivery app service discontinued its operations in all cities except Mumbai that's too despite $27 million funding amount raised from Matrix Partners and Sequoia Capital.

What’s going wrong in Indian Startup Ecosystem?

All these failures offer much to learn. Most important point is that the Indian market is in nascent stage and tremendous challenges stop startups to become money-spinning. Some startups wiped out because they were copycat ideas and failed to compete in stiff competition from leading giants who are backed by a crowd of investors. Moreover, startup companies also failed to fulfill the expectation of investors who compare the Indian market with Silicon Valley and US market and over pressurized founders to make businesses profitable before scaling. Some other failed because they lack right talent or did not have enough money hire talented staff.

[Top Image - Shutterstock]

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