Koo shuts down: India's X rival shuts operations amid acquisition failures and financial struggles

Started as an alternative to X (formerly Twitter), Indian microblogging social media startup Koo is shutting down amid severe financial troubles and potential acquisition talks falling through.

In a post on LinkedIn, the co-founders announced that despite discussions with several large internet firms, conglomerates, and media houses, no satisfactory partnerships materialized.

They went on to say, that many were reluctant to manage user-generated content and the unpredictable nature of a social media company.After launching in March 2020, Koo gained popularity and reached over 9 million monthly active users by July 2022.

Koo had managed to secure $60 million in funding from known investors like Tiger Global and Accel after it won the Atmanirbhar App Innovation Challenge, a part of the Indian government’s “Make in India” initiative.

However, the company soon began facing challenges. In September 2022, around 40 employees were let go. By April 2023, as per reports, the company downsized its workforce by 30%. Meanwhile, Koo's monthly active users dropped to 3.1 million in April 2023, down from a peak of 9.4 million in July 2022.

In recent months, the company was in talks with Dailyhunt and Sharechat, but these negotiations did not materialize. As the founders sought new partners, they acknowledged facing increasing challenges.As fewer users joined the platform over time, Koo struggled to control its spending, despite cutting jobs and costs.

By April 2023, they had managed to bring down their monthly expenses to about 10.2 crore rupees from around 16 crore rupees in January 2023. However, the company has been in a tight spot without being able to raise additional funds.

"The mood of the market and the funding winter got the better of us. Koo could have easily scaled internationally and given India a global brand that was truly made in India. This dream will remain" the founders said in the LinkedIn post.