Despite a challenging funding environment, India’s startup ecosystem showed signs of relative stability in 2025, with closures falling sharply compared to last year. Around 730 startups ceased operations this year, a major decline from the 3,903 closures recorded in 2024, according to the Department for Promotion of Industry and Internal Trade (DPIIT). Currently, India has over 2.06 lakh registered startups.
However, the list of closures includes several notable names across electric mobility, hyperlocal delivery, consumer internet, and e-commerce sectors.
Notable Exits in 2025:
- BluSmart: The electric ride-hailing startup, launched in 2019, suspended operations in April after financial misconduct was detected at Gensol Engineering, a solar EPC firm connected to BluSmart’s founders. The company had expanded its fleet to over 8,000 EVs and raised around $168 million from investors including BP Ventures. Internal disruptions, leadership exits, and delayed salaries led BluSmart to transfer its fleet to Uber.
- Dunzo: Once a pioneer in hyperlocal delivery, Dunzo shut down after failing to compete with quick-commerce rivals such as Zepto, Swiggy Instamart, and BlinkIt. Despite raising $240 million from Reliance Retail in 2022, high operational costs, including IPL sponsorships, and inability to raise fresh capital contributed to its closure.
- Hike: The messaging platform founded in 2012 by Kavin Mittal, which at its peak had over 100 million registered users, wound down its remaining operations in September. Regulatory changes, including the ban on real-money gaming apps, ended the company’s pivot to its gaming platform, Rush.
- Good Glamm Group: The digital-first consumer brand aggregator faced challenges from heavy acquisition-related debt, slowing growth, and limited access to funding. Several acquired brands, including Sirona and The Mom’s Co, were shut down as anticipated efficiencies failed to materialize.
- Otipy: The B2B2C grocery delivery startup ceased operations in May due to mounting financial pressures and delayed payments to vendors and employees. Founded during the pandemic by former Blinkit CTO Varun Khurana, Otipy offered a subscription-based farm-to-fork delivery model.
Industry Trends:
Data from Tracxn, cited by ET, shows that startup shutdowns fell nearly 80% in 2025 compared with the peak period of 2021–22, when more than 11,000 startups wound down. Over the past five years, enterprise applications accounted for the largest share of closures, followed by retail and edtech, with healthtech, entertainment, and media also seeing significant exits. Among states, Maharashtra and Karnataka recorded the highest number of shutdowns.
