Case Study: The Fall of Doodhwala: Explained

The co-founders of Doodhwala, Ebrahim Akbari and Aakash Agarwal

Doodhwala was an Indian start-up started by co-founders Ebrahim Akbari and Aakash Agarwal in 2015. They started this business in Bangalore, India. They began with the vision to deliver fresh farm milk directly to the consumers.

It consisted of everything they would need for success like the funding (The start-up raised a total fund of $2.4 million), two young entrepreneurs, a massive vision, and a growing market for their products and services in India. However, they failed miserably.

What’s new is that a start-up shutting down after receiving funds is not something uncommon, but the founders were charged with fraud, and FIRs were filed against them. Many of their employees and other networks alleged that the company left them unpaid for months.

Here’s their beginning. After Bangalore, the start-up widened to two more cities, namely Hyderabad and Pune. The firm brought milk, fresh dairy items, fruits, groceries, and other daily essentials to the customers’ doorstep. They scaled a 5-member team to a massive 400-member team in under three years.

They started delivering well above 30,000 liters of milk on the previous day each; out of that 60% was just in Bangalore. Co-founder Ebrahim Akbari commented that consumers were seeking ways to search for good quality and unadulterated milk straight from the farm. In other words, they wanted economical, on-time, and non-traditional fresh milk and other dairy items.

They had many reasons to fail, including reasons like they were operating on low margins, an excessive usage of cashback and discounts, no clarity in differentiating factor or competitive advantage, faced intense competition from biggies like Big Basket and Grofers, and the list goes on. If there was only one reason present, they could have swum to the other side of the ocean.

Now, they owe around 6-7 crores to 30-35 vendors, 2.88 lakhs to their marketing head, more than 17 lakhs to Adern Creamery (they gave them a cheque amounting to 9 lakhs, but it bounced), more than one lakh to Lokal Buzz Events and Promotion, and other 60-70 employees. Not only this, skim through Doodhwala’s social media pages. It displays plenty of annoyed customers who are yet to receive orders and refunds.

This case is still wrapped in mystery as to what went wrong with Doodhwala, and what happened to them is still a question mark. Yes, there are numerous reasons why they drowned like the Titanic, but a solid conclusion is still far from being clear.

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