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Startups face a zombie threat: Investors
Business Standard
|July 08, 2024
Homegrown micro-blogging platform Koo shut down operations last week after acquisition talks failed.
Other notable startups that have entered the dead pool in recent years include Niki, Zipgo, Crejo.Fun, FrontRow, and GramFactory.
"Founders need to ensure their business models work from Day 1. Companies like Koo, operating on a 'copycat' model without differentiation, cannot survive in a market like India. The market is ruthless and will sweep away lazy ideas," said a prominent investor, speaking on the condition of anonymity.
Decline in the dead pool
In 2021, 5,868 startups shut down due to macroeconomic headwinds. This figure fell to 1,720 in 2023 and just four in 2024 so far, as macro conditions improved, according to Tracxn, a market intelligence platform. This decline, in part, can be attributed to the funding winter, which, according to investors, has instilled "fiscal discipline" among founders.
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