Hike Shuts Down as India Cracks Down on Real-Money Gaming
In a significant development, Hike, once one of India's most valuable startups with unicorn status, has shut down its operations in the country following New Delhi's recent ban on real-money gaming. The company, led by Kavin Bharti Mittal, son of Airtel founder Sunil Bharti Mittal, had been struggling to scale globally despite attracting over 10 million users and generating more than $500 million in gross revenue through its primary platform, Rush.
On Saturday, Hike founder Mittal announced the shutdown, citing that scaling the U.S. business would require a full recap, which he deemed not the best use of capital or time. "We could raise the capital, but the real question is: is it worth it? Is this a climb worth pivoting?" Mittal said in an interview.
Hike was initially launched as an instant messaging app rivaling WhatsApp in 2012 but pivoted to real-money gaming in recent years. The company's primary platform, Rush, offered casual games like carrom and ludo for cash prizes following the shutdown of Hike Messenger in 2021. Storied investors including Tiger Global, SoftBank, and Tencent backed Hike's early ambition to take on WhatsApp with a youth-focused messaging app.
The startup was valued at $1.4 billion in 2016 but struggled to maintain its valuation as the Indian government cracked down on real-money gaming. The ban, which came into effect in March, prohibits online games that involve betting or wagering of money.
Industry experts say Hike's shutdown is a significant blow to India's startup ecosystem, which has been grappling with regulatory challenges. "The shutdown of Hike highlights the risks associated with investing in startups that operate in regulated spaces," said Rohan Bhansali, partner at venture capital firm Omidyar Network.
Hike's shutdown also raises questions about the future of real-money gaming in India. While some experts believe that the ban will drive innovation and create new opportunities for startups, others argue that it will stifle growth and lead to job losses.
As Hike winds down its operations, Mittal has hinted at exploring new ventures. "We're not out of the game yet," he said. "We'll be back, but in a different form."
*Reporting by Techcrunch.*
