RIP 2024: The Rise and Fall of Startups That Couldn’t Survive the Year
The year 2024 witnessed a significant increase in startup failures across various sectors, reflecting the challenges faced by emerging companies in a volatile economic environment. According to data from Carta, 254 venture-backed companies ceased operations in the first quarter of 2024 alone, marking a 58% increase compared to the same period in 2023.
Notable Startup Failures in 2024:
- Allplants: Founded in 2016, this UK-based vegan meal kit startup raised $81 million from investors including Molten Ventures and Felix Capital.Despite initial success, Allplants faced difficulties post-COVID-19 and moved to appoint administrators in November 2024 due to insolvency concerns.
- Arrival: An electric vehicle manufacturer that went public in 2021 with a $13 billion valuation. By February 2024, Arrival’s UK arm filed for administration amid financial struggles.
- Cake: This Swedish producer of lightweight electric motorcycles and scooters, established in 2016, filed for bankruptcy in early February 2024 after failing to secure a €7 million bridge loan.Its assets were later acquired by Norwegian company Brages Holdings for €1.6 million.
- Infarm: Once a leader in vertical farming with operations across 10 countries, Infarm raised nearly $500 million from investors like Balderton and Atomico. However, operational inefficiencies and rising energy costs led its UK entity to announce intentions to appoint administrators in October 2024.
- Lilium: A German-based flying air taxi startup founded in 2015, Lilium went public via a SPAC merger in 2021.By October 2024, the company announced its insolvency and received a delisting notice from Nasdaq. Subsequently, an investor group named Mobile Uplift Consortium expressed interest in acquiring its assets.
- MaaS Global: Established in 2015, this Finnish mobility startup, known for its city travel app Whim, filed for bankruptcy in March 2024 after raising over $162 million from investors including BP Ventures and Toyota.
- Northvolt: A prominent player in the electric vehicle (EV) sector, Northvolt filed for bankruptcy in 2024 amid declining demand, rising costs, and supply chain issues. This collapse underscores the broader challenges faced by EV startups during the year.
- Oovvuu Pty Ltd: An Australian media startup founded in 2014, Oovvuu aimed to provide video content to over 250 media publishers The company collapsed into liquidation in 2024, affecting several prominent media organizations worldwide and leaving nearly $1.3 million in debts to creditors.
- Universal Hydrogen: A clean-fuel startup backed by Airbus and JetBlue, Universal Hydrogen faced shutdowns and financial difficulties in 2024, reflecting the struggles within the clean-fuel sector despite initial optimism.
The surge in startup failures during 2024 highlights the inherent risks in the startup ecosystem, influenced by factors such as economic downturns, funding challenges, and market dynamics. As the startup landscape continues to evolve, these closures serve as critical learning points for entrepreneurs and investors navigating the complexities of building sustainable businesses.
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