Despite a raging crisis around the brand, consumers took to social media to profess their admiration for BluSmart and its fleet of green rides. But, when EV startup BluSmart found itself in trouble recently, observers noted an uncanny silence from its branding and communications team. There were no public statements, no investor updates, no founder apologies, only a void quickly filled by investigations, speculation and criticism.
It’s not the first time a promising startup has stumbled in public view. From Byju’s aggressive sales controversies to GoMechanic’s financial irregularities, a pattern has emerged time and again: Indian startups often excel at building hype but falter when reality demands accountability.
Branding Without a Backbone
“In PR, we are often focused just on polishing the image of the company, irrespective of what the founders are doing on the ground,” says Praveen Singh, Founder & Chief Strategist, StrategyVerse Consulting.
He points to Byju’s where, despite rising customer complaints, the branding team maintained a glowing public image until legal troubles made headlines. “We’ve seen the same with BluSmart. There’s a clear breach of trust with investors, customers, employees and yet no coordinated communication response.”
The issue is systemic, Singh notes. “Brand and PR teams still don’t have enough authority to confront founders. In many cases, the management itself is missing from public view when a crisis hits, and comms teams, tied to leadership instructions, can’t act independently.”
He argues that startups need continuous audits not just of operational health, but of whether the brand narrative still matches reality. “If we don’t listen to customer feedback and fix gaps proactively, these episodes will keep happening,” he warns.
Investor Story vs Consumer Story
Anup Sharma, a PR and strategic communications consultant, highlights another fracture point: the growing mismatch between investor-facing narratives and consumer-facing realities. “Investor communications often emphasize market opportunity, scalability, revenue models, and long-term vision. Consumer-facing communications, however, need to focus more on the immediate value the product or service delivers. When these two stories get out of sync, it can create confusion and distrust.”
Sharma points to Byju’s again. “To investors, Byju’s painted a picture of rapid international expansion and a billion-dollar edtech market opportunity. But on the consumer side, there were rising concerns around aggressive sales tactics and product dissatisfaction. The mismatch eventually began impacting both consumer trust and investor confidence.”
The same pattern played out internationally with Uber during its early regulatory battles, and more recently, closer to home with GoMechanic, where silence during crisis only worsened the brand’s downfall.
Silence Amplifies Speculation
“Startups celebrate their wins loudly — funding rounds, awards, partnerships,” Sharma observes. “But when facing pivots, shutdowns, or internal crises, many go silent — out of fear of negative perception or legal consequences. The problem is, that silence creates a vacuum, and speculation fills it.”
During the COVID-19 pandemic, companies like Airbnb showed how it should be done; they managed layoffs with open letters, clear communication, and ongoing support for affected employees, retaining brand goodwill despite harsh realities. In contrast, WeWork’s disastrous IPO attempt stands as a warning: defensive, inconsistent communication only magnified stakeholder distrust.
According to Sharma, “A good PR strategy aligns messaging with the actual stage of the company’s development—whether it’s finding product-market fit, scaling, or preparing for a new funding round.”
One of the biggest and known start-up companies OYO, aggressively marketed global expansion before establishing strong operational foundations, leading to later reputational challenges. On the flip side, brands like Freshworks from India took a steady, carefully managed approach to communication, focusing on realistic milestones before their IPO on Nasdaq, which helped maintain credibility with both investors and other stakeholders.
“Even during a crisis, consistent and emotionally intelligent communication is critical,” Sharma stresses. “Stakeholders look for leadership more than ever in tough times.”
Zomato’s founder Deepinder Goyal offers a rare example of effective crisis communication. Facing backlash over profitability concerns and delivery worker treatment, Goyal consistently addressed issues head-on through social media updates, open letters, and interviews where he acknowledged shortcomings without defensiveness. His tone remained humble yet confident, empathetic yet firm which appears to be a strategy that helped Zomato retain brand trust even under heavy scrutiny.
Branding Cannot Mask Operational Failures
Brand consultant Nisha Sampath believes today’s startups often confuse ‘branding’ with ‘purpose’. “The real responsibility for the company’s narrative, especially in a startup, lies with the founder, who, like the captain of the ship, is steering the narrative. If the founder surrenders the narrative to branding teams, and external agencies, without giving them sufficient, consistent and ongoing indication of the value system and thought process that underpin the business, there is a danger of a gap emerging.”
Rutu Mody Kamdar, founder of Jigsaw Brand Consultants, adds, “Brand-building is powerful, but when it runs ahead of viability, it creates a fragile ecosystem — one where expectations are raised before the experience or the operations can match up. Purpose needs to emerge from lived reality, not just aspiration. Otherwise, branding risks becoming a castle built in the air.”
Kamdar sums it up sharply, “Branding and marketing teams do play a role, but the larger accountability lies with leadership. Brand teams can shape the story, but they cannot substitute the substance.”