Lessons from Nepal’s First Generation of Disruptors
In the past decade, Nepal has seen a start-up boom. Coffee shops in Kathmandu buzz with young founders sipping latte with potential investors and local media feature start-ups with enthusiasm. It almost feels like Nepal is incubating its own Silicon Valley.
But I’ve watched with sadness as promising Nepali ventures capture headlines and funding rounds, only to fade away under the weight of their own hype. Start-ups are hard. They say 9 out of 10 start-ups fail. As many of Nepal’s most celebrated ventures plateau or disappear, their journeys offer rich lessons for founders, investors and other stakeholders. In this piece, I’ve tried to chronicle five of the country’s most visible start-ups. Each told a compelling story but not all of them delivered on it. Disclaimer: the cases have been randomly picked and compiled based on public perception and may not capture inside stories.
A Ride That Faded Away
Tootle was Nepal’s first ride-sharing platform that tapped into a real urban transportation problem. It built significant user traction in its early days, contributed to establishment of dignity of labour amongst riders and even nudged policymakers to start working on regulations governing new economy businesses. It was popular and truly a dream start-up.
But instead of consolidating the operational backbone, the leadership was swept into a wave of media attention. Public speaking gigs, features in business magazines and start-up awards became the primary outputs. Meanwhile, a formidable competition from deeper-pocketed entrant like Pathao emerged and soon dominated.
Tootle itself got disrupted. And it self-sabotaged by underestimating the importance of execution and overestimating the power of public goodwill. I understand the business is now trying to revive under a new management and I wish them success.
Dream of Nepali Amazon
Sasto Deal symbolized e-commerce optimism in Nepal. The opportunity looked enormous in an underserved online retail market. The charismatic and persuasive founder pulled in funding and media buzz in equal measure.
But as the brand scaled, operational cracks widened. Inventory mismanagement, fulfillment failures and cash flow mismatches haunted the company. Customers grew increasingly frustrated and investors saw their value diminish with down-rounds that were raised. The final blow came when concerns of unpaid vendors and disillusioned employees became public. The house of cards collapsed, leaving behind a story that still haunts Nepal’s alternative investment fraternity.
Home Chefs in Business
Where food delivery companies generally partner with restaurants, Foodmario tried something bolder: empowering home cooks, mostly women, to become food entrepreneurs. It was a platform with a social angle, that was described as exemplary even by Nepal’s only billionaire.
But the model was fragile. Quality of food varied, logistics were messy, and customers weren’t always willing to pay a premium for home-cooked meals. Managing chefs as well as costumers proved too difficult. Despite noble intentions and bursts of momentum, Foodmario never gained any scale of significance. I’m not sure if it is operational anymore.
Momo Mania
Although not a tech start-up, Dalle as a food chain was no less disruptive. It brought cultural flair and urban branding to Nepal’s beloved momo. Dalle captured the imagination of the nation as its flagship product achieved instant popularity, securing one of the earliest venture capital investments in Nepal.
Unsurprisingly, rapid expansion of number of outlets followed and it looked like Dalle was Nepal’s response to Chipotle. That’s perhaps when the challenges began to creep in, which founders took notice of only much later. Operational costs became too high for a momo business. Other momo entrepreneurs learnt from Dalle and expanded their own enterprises, retaining higher margins they enjoyed historically.
Dalle remains operational, but without the spark that once defined it. The founders are capable and grounded entrepreneurs and I believe they have the drive and inclination to revive the business to its old glory.
Food in the Du
One start-up that has demonstrated staying power is Foodmandu, Nepal’s pioneering food delivery platform. It launched in 2010, long before delivery culture went mainstream. It has survived political instability, an earthquake, local competitors and even a pandemic.
So what did Foodmandu get right?
It scaled cautiously. It invested in logistics and back-end operations before marketing blitzes. It built enduring relationships with restaurants and riders. Although there were growing pains and hiccups in peak periods, the brand cultivated enough trust to stay the course. While start-ups like Sasto Deal and Tootle raced ahead on branding and promises, Foodmandu moved quietly and deliberately, attracting rounds of funding and enabling the founder to achieve a handsome partial exit.
Foodmandu is seemingly a rare success story in this list but it continues to face competitive headwinds and cash burns. With prominent PE investors on its cap table and a war chest of cash, will the company really make it big? Let’s watch.
What These Stories Tell Us
These examples reveal a pattern and crucial lessons for Nepal’s new wave of start-ups.
Storytelling outpaced structure: Founders mastered pitches but not system building. Charisma may secure funding, but it won’t fix supply chains. Even popular brands need back-end muscle and strategic evolution.
Capital came before governance: Many start-ups raised money but lacked governance. Boards lacked proactivity and oversight. Investors became cheer-leaders instead of partners and backed the buzz instead of builders. Without accountability, growth became chaotic.
Execution is more important than idea: Every venture had a viable idea, but execution failed in terms of consistency, team management and openness to pivot.
Expect competition from unexpected corners: Being first isn’t enough. Doing better than competition is more important. In Nepal, staying power is true disruption.
Nepal is a tough market: Low purchasing power, poor infrastructure, and regulatory uncertainty make scaling hard. Start-ups need more than grit here. It takes a village to raise a child. In fragile ecosystems like Nepal, where capital is scarce and institutional trust low, each failed hype story sets the entire scene back.
Let’s Not Forget the Failures
Despite failures, Nepal’s start-up landscape isn’t bleak. Entrepreneurs have learned from the crash landings. Founders today are more savvy and are hopefully focusing on building businesses rather than going viral. A few success stories from earlier generation like eSewa and Himalayan Java are cases to draw inspiration from.
Start-ups fail everywhere, so let’s not bury these stories as embarrassments. They’re valuable case studies for business schools, debates in boardrooms and inspiration for building the future. Let’s celebrate start-ups for surviving the process of becoming real businesses, not just for raising funds.
August 2025
Former banker Suman Joshi is a private equity investor and ecosystem builder based in Kathmandu.
Very insightful article Suman Joshi dai. Your takeaways were spot on and I hope those founders and entrepreneurs going through various stages of the cycle take note so that they can learn from the mistakes of those that came before. So much to learn from failures, not just the successes.
Loved the cases you presented Suman Joshi dai. It is sad to hear about failures but indeed there were stories behind. One big snake charmers are the too early media visibility. This has ruined many lives. That's why I suggest many initiatives not to be caught into media hypes, prove the work until reaching a break-even.
Sir your article offers a thoughtful reflection on the journey of Nepal’s prominent startups. The insights are valuable and timely. That said, could there also be room for self-reflection too within the investor and asset management community? While founders are often critiqued for lack of structure or execution, many VCs and asset managers in Nepal were themselves early-stage operations, navigating their own internal chaos. Several had teams made up entirely of bankers, analysts, and accountants smart and capable people, but often without anyone who had ever built or scaled a business from scratch. Without that firsthand entrepreneurial experience, how equipped were these institutions to support founders through the real pressures of building? The emotional, operational, and financial weight that entrepreneurs carry is hard to grasp from the boardroom alone. You mention media hype and stardom but speaking personally, much of that attention was driven by the PR strategies of investment firms, not by founders seeking fame. That spotlight, while flattering, often came with more pressure than support. So, is it entirely fair to judge those founders for stumbling when even the systems meant to guide us were learning as they went?
💡 Great insight
Dear Suman Sir - every word and line in your article is so relevant, a reminder as not to get too excited with ideas but focus on the operations and management. Look forward for more readings