New Delhi, Jan. 5 -- At first glance, India's startup ecosystem appeared to regain its footing in 2025. According to Tracxn, around 730 startups shut down during the year, a steep decline from 3,903 closures in 2024. After two bruising years of funding contraction, the numbers seemed to suggest that the worst was over.

Even as the markets cheered a wave of tech IPOs, the other side of the narrative was unfolding quietly: a sharp spike in shutdowns that underlined the end of the easy-money era.

For many observers, the headline figure pointed to recovery. Fewer shutdowns meant fewer failures. Fewer failures meant resilience. The logic was comforting and incomplete.

A closer look at the companies that failed in 2025 tells a more unsettlin...