Startup failure can happen for many reasons from an inability to scale and changing market conditions to funding challenges and strategic mistakes. But business failure is not the same as fraud. India already has significant support mechanisms, including the ₹945-crore Startup India Seed Fund Scheme, SIDBI’s ₹10,000-crore Fund of Funds for Startups and the Credit Guarantee Scheme for Startups. So where is the gap? The video explores how genuine business closures can affect access to credit, working capital and investor confidence — and why a clearer pathway for responsible exits and re-registration could encourage entrepreneurship. We also examine international approaches, including China’s support for eligible failed entrepreneurs. The larger question is simple: Can India build a startup ecosystem where entrepreneurs are allowed not just to start and scale, but also to fail, learn and restart?