Hike, Once a Unicorn, Shuts Down Amid India's Real-Money Gaming Ban
In a significant development, Hike, one of India's most valuable startups with unicorn status, has ceased operations due to the country's recent ban on real-money gaming. The company, founded by Kavin Bharti Mittal, son of Airtel founder Sunil Bharti Mittal, had been struggling to scale its U.S. business despite a strong start.
According to Mittal, the startup's primary platform, Rush, which offered casual games like carrom and ludo for cash prizes, attracted over 10 million users and generated more than $500 million in gross revenue over its four-year run. However, with India's ban on real-money gaming taking effect, Hike was forced to shut down.
"We could raise the capital, but the real question is: is it worth it?" Mittal said in a statement. "Is this a climb worth pivoting? We decided that it wasn't."
Hike initially launched as an instant messaging app rivaling WhatsApp in 2012. However, after its pivot to real-money gaming, the company's valuation soared to $1.4 billion in 2016. Storied investors including Tiger Global, SoftBank, and Tencent backed Hike's early ambition.
The shutdown of Hike marks a significant blow to India's startup ecosystem, which has been grappling with regulatory challenges. The country's ban on real-money gaming is part of a broader effort to regulate the online gaming industry, which has seen rapid growth in recent years.
"Hike's shutdown highlights the risks and uncertainties associated with investing in emerging markets," said Rohan Mahajan, a venture capital expert. "While Hike had shown promise as an instant messaging app, its pivot to real-money gaming proved to be a high-risk strategy."
The implications of Hike's shutdown are far-reaching, with potential consequences for investors, employees, and users alike. As the Indian government continues to regulate the online gaming industry, startups will need to adapt quickly to remain competitive.
In a statement, Mittal expressed gratitude to his team and investors for their support. "We are proud of what we achieved at Hike, but we recognize that sometimes it's necessary to take a step back and reassess our priorities," he said.
As the dust settles on Hike's shutdown, one thing is clear: India's startup ecosystem will need to navigate increasingly complex regulatory landscapes in order to thrive.
*Reporting by Techcrunch.*
