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STARTUP

50 Failed Startups in
India: Mini Case
Studies.
Learn From What These 50 Failed Indian Startups
Did Wrong.

HARKIRAT SINGH
19 SEP 2021
• 31 MIN READ

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The Indian startup ecosystem is overflowing with ideas. A good
idea is the foundation of any successful startup, but having a good
idea isn't always enough.
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Despite the best intentions of founders and investors, the lack of
scalable ideas causes 9 out of 10 Indian startups to fail like lead
balloons.

While failure is a painful pill to swallow, it is also an excellent

teacher. There is no greater disappointment for a startup founder
than seeing their hard work go to waste. However, there's also a
positive side: if you never fail, you will never know what
works.

The team at HelloMeets did the research of 50+ Indian startups

and figured out why they failed.

Here's the list of 50 unsuccessful startups in India:

Pepper Tap

Doodhwala

Local Banya

Tiny Owl

Bite Club

Dazo

Yummist

GrocShop

Mr. Needs

Monkey Box

iProf

Purple Squirrel

GoZoomo

Loan Meet
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Zebpay

Koinex
Card Back
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Doc Talk
BabyBerry

Doormint

Task bob

GetNow

Flashdoor

RUSSSH

Jabong

Buttercups

Wooplr

Klozee

Just Buy Live

Shopo

Finomena

Fashionara  

Shotang

Hike Messenger

COGXIO

Parcelled

Ezytruck

Truckmandi

Roder

Tazzo

Technologies

AUTOnCab

Hey Bob You've Could

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Freshconnect

Dial-a-Celeb
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App Surfer
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Intelligent Interfaces

InoVVorX

Stayzilla

Rooms Tonite

Job Bridge

Without further a do, Let's dive in!

Get Access to Case-by-Case

Analysis of Why These 50
Startups Failed
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 STARTUP PRODUCT MANAGEMENT PRODUCT DESIGN MARKETING NO CODE D

Grocery/Food Delivery 🥕
1. Pepper Tap

Founded by Milind Sharma and Navneet Singh, Pepper tap is a

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online a cheaper
price. Moreover, The brand promises to get the order delivered
within 2 hours at the customer's doorstep.
The company raised
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rounds. Only because the idea of PepperTap was so promising,

they went all in.

Unfortunately, In April 2016, PepperTap announced that they were

pulling its shutters down.

Why did PepperTap fail?

PepperTap spent a hefty amount to acquire customers.

Their uncontrolled marketing budget was the biggest reason
for PepperTap.

The company was losing money on every order due to

heavy discounts (as high as 70%) with no signs of
profitability in future.

Another reason for the shutdown was Pepper Tap "zero

inventory owned" model. They only collated inventories
from grocery stores and then updated their offerings.

Pepper Tap wants grocery stores to share their updated

inventory with them continuously. And if stores didn’t have
digital inventory systems, the Pepper Tap team would get
them updated manually.

Due to uncontrollable supply, the product faced inventory

glitches and a lot of orders had to be cancelled.

2. Doodhwala

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Founded in 2015, Doodhwala is a subscription-based service that

delivers milk, fresh dairy products, groceries and other daily
essentials directly at consumer's doorstep.

Despite having visionary founders and funding, why did

Doodhwala fail to takeoff?

According to Apptopia, the startup monthly downloads were

at 34,146 with a month-on-month (M-o-M) fall of 34.28% as
of October 1, 2019.

They were operating on low margins, with excessive usage

of cashback and discounts.

Faced intense competition from BigBasket and Grofers with

no differentiating factor or competitive advantage.

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After shutdown, Sellers documented an FIR against Doodhwala
founders Aakash Agarwal and Ebrahim Akbari. They claimed that
the company owed them numerous crores as pending salary.
t e co pa y o ed t e u e ous c o es as pe d g sa a y.
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Moroever, the company marketing head Radha Krishna had

documented a protest against the founders. He asserted that
founder owed Rs 2.88 lakh to him.

3. Local Banya

Founded by trip Amit Naik, Karan Mehrotra & Rashi Choudhary,

Local Banya was Mumbai’s first online convenience store.

The platformYou've
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and vegetables, exotic vegetables, groceries, personal care,
household supplies, detergents, kitchen ware, breakfast, snacks,
etc.
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After achieving a fund of $5 million, the company started to offer

great deals and bargain prices to attract customer.
Why did Local Banya fail?

Local Banya decided against an inventory-based model,

held a very small inventory and forge tie-ups with local
wholesalers and retailer.

Heavy relieving on local vendors resulted in a gap in

delivering the required no. of products to the customers.

The customer had several complaints against the ordered

products and their quality. Poor grievance redressal
mechanism.

Retailing food & groceries need a constant flow of funds

because margins are miniscule. The company failed to seek
fresh funds.

The company could not withstand with immense

competition from online companies like Groffers and Big
Basket which were cash-rich due to the huge funding.

4. Tiny Owl

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This food-tech startup aims to create value for all stakeholders in

the food ecosystem that includes the restaurant owners, staff,
suppliers and consumers.

Through Tiny ownl app, Consumers were able to view each dish
with the chef’s profile and order the food from nearby restaurants.

As the business observed a rise in the number of orders per day,

Tiny owl went on a hiring spree, and hired employees rapidly to
achieve high growth targets such as reaching 50 cities in one and a
half years.

However, the business didn’t grow accordingly. From a peak of

about 1,100 employees, they went to just 200.

Unfortunately, Tiny owl shuts down in 2016 when it was acquired

by Roadrunnr.

Why did Tiny owl fail?

Hiring more people meant putting up organisational

structures and hierarchies. However, when things are
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growing at a fast speed, it's difficult to form those structures
accordingly.

According to the founder Saurabh Goyal Tiny owl was

 According to the founder Saurabh Goyal, Tiny owl was
having 1,000 delivery
STARTUP boys while scaling
PRODUCT MANAGEMENT delivery
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MARKETING NO CODE D

they found out later that 1,000 delivery boys were not
needed. That's where all the unit economics took a hit.

Tiny owl founders weren't clear about of core metrics they

want to first improve on before scaling.

They spent lakhs of rupees Just in newspaper advertising

and other marketing resources for customer acquisition.

With such a considerable investment in their hands,

founders thought the best way to use the fund would be by
hiring more people and spending more money on
marketing resources.

5. Bite Club

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Bite club enables users to order meal from a dynamic changing

menu through its Android app.

The idea was to bring food lovers and cooks together on one
platform.

The company sources food from aggregate chefs like professional

chefs, home cooks and then delivers it to consumers— lunch and
dinner.

The business attracted investors pretty soon and received seed

funding of 1.5 crore from prominent investors including Powai
Lake Ventures.

Within a year, the gurugram startup served more than one lakh
meals, averaging 274 meals a day.

Within a year of raising funds, the founders decided to shut down

the operations after failing to make money in this operation heavy
segment.

Why did Biteclub fail?

Not able to standardized food quality for customers and

maintaining it as it scales.

Heavy cash burn on discounts offering meals at cheap price

between Rs 100-Rs 300/person.

The biggest competitor of Bite club was home kitchens. And

the company failed to change the behaviour of users who
like to eat home cooked meal.

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6. Dazo