Indian Startup Closures in 2025: Key Ventures That Couldn’t Survive the Year

In 2025, India’s startup ecosystem showed signs of resilience with far fewer closures than the previous year, but several notable ventures still failed to survive amid financial strains, competitive pressures, and regulatory challenges. According to Department for Promotion of Industry and Internal Trade (DPIIT) figures, approximately 730 startups shut down in 2025, a significant drop from the nearly 3,903 closures recorded in 2024, highlighting an overall stabilization in the industry even as some prominent names exited the market.

One of the high-profile exits was BluSmart, an electric vehicle ride-hailing startup founded in 2019 that aimed to challenge India’s transport duopoly with emission-free rides and salaried drivers. Despite expanding its fleet and raising significant funding, the company was hit by a fraud scandal linked to Gensol Engineering, leading to operational disruptions, salary delays, and eventual suspension of services. BluSmart’s fleet was later absorbed by Uber, sending shockwaves through the cleantech and startup community.

Another major shutdown was Dunzo, once a pioneer in hyperlocal delivery and backed by Reliance Retail with a $240 million investment. The company struggled to maintain competitiveness against faster-growing rivals in quick commerce, grappled with funding gaps, and saw key leadership departures, culminating in the closure of its consumer app and services by September. 

Hike, once a promising homegrown messaging platform that rivaled global players with over 100 million users, also concluded its journey in 2025. After pivoting through multiple product iterations and eventually into real-money gaming, the company was dealt a final blow when tightening online gaming regulations forced it to wind down remaining operations. 

The Good Glamm Group, a roll-up ecommerce venture that at one point boasted a near-unicorn valuation and a portfolio of brands, struggled under heavy acquisition-driven debt and integration challenges. Despite ambitious growth plans, stalled performance and a dry funding pipeline led to its significant business wind-down and lenders exploring asset breakups. 

Otipy, a community-focused grocery delivery platform that connected consumers directly with farmers, faced intense competition from rapid delivery models and increasingly strained finances. The company, once backed with over $44 million in funding, ultimately shut operations in May, leaving many employees and delivery partners without jobs. 

While these closures were among the most talked-about, data suggests that the broader trend in 2025 was one of consolidation rather than widespread collapse, with closures dropping sharply year-on-year. Analysts note that this may reflect improved funding climates, greater emphasis on business model sustainability, and a maturing ecosystem that prioritizes long-term viability.