Remember Hike, The App That Once Challenged WhatsApp? It’s Shutting Down After 13 Years

Summary is AI-generated, newsroom-reviewed

Hike, the messaging and gaming app, which made headlines 13 years ago for its potential to beat WhatsApp, is going away forever. Kavin Mittal, the founder of the app, in an email to investors, announced that Hike is shutting down completely, including the US business, citing India’s decision to ban real money gaming in the country.

“After much reflection and speaking with a few of you, I’ve decided to wind down Hike operations completely,” Mittal wrote in an email seen by Entrackr. 

Hike began as a messaging app, similar to WhatsApp, but it couldn’t compete successfully. So, it changed its business to focus on gaming, creating a new platform called “Rush.”

The new gaming business was very successful in a short amount of time, attracting a large user base in just four years. However, the ban on real money gaming in India significantly hurt Hike’s business model. According to Mittal, this regulatory change reduced the company’s financial runway, which is basically the amount of time it could operate with its current funds, from seven months to just four. Hike had a new business in the US that was showing promising results. However, the financial setback in India was so severe that it made it impractical to continue.

Hike has $4 million remaining in its balance sheet. This money will first be used to pay off vendor costs and employee severance. If there is any money left over after paying all vendors and employees, it will be returned to investors.

Mittal believes that they were forced to play a game they didn’t want to play, got stuck in it, and ultimately lost. The ban was the final signal that it was time to quit the game.

“RMG was never the destination. It was a means to prove unit economics and unlock the bigger vision. But we got locked into the Indian market in a tax/regulation battle,” he said.