Astrotalk, India’s premier astrology tech startup, recently suffered a major setback when its $100–120 million investment deal with Hornbill Capital fell through at the due diligence stage. The main reason given was the fact that NSFW content, including pornographic videos and chats, had been found on the platform. This had created concerns regarding reputational risks as well as compliance under regulations.
Background of the Deal
Hornbill Capital, which is an India-focused hedge fund, had expressed keen interest in Astrotalk at a valuation of $1–1.2 billion, more than three times its valuation of $300 million in 2024. The talks were at an advanced level, with both sides optimistic about the deal. But while conducting due diligence, Hornbill Capital raised concerns about the NSFW content on Astrotalk’s platform, resulting in cancellation of the deal.
Astrotalk’s Response
Astrotalk co-founder Anmol Jain countered the accusations with, “All this is absolutely baseless because we never signed any term sheet with any investor.” No official deal was in place with Hornbill Capital according to the company. Even then, industry players point to the NSFW content factor as a major contributing factor in the breakdown of the deal.
Future Plans and Financial Performance
Astrotalk has shown remarkable financial growth despite the fallout. The firm posted a revenue of ₹1,200 crore in FY25, which was almost doubling its ₹651 crore revenue during FY24. Profits also doubled, moving from ₹100 crore to ₹250 crore for the same duration. Astrotalk credits this growth due to its growing user base and the growing popularity of astrology services. The firm plans to see further growth by looking at alternative funding mechanisms and extending its offerings.
The breakdown of the $100 million deal with Hornbill Capital illustrates the difficulty startups have in sustaining platform integrity and following investor demands. Although Astrotalk’s performance remains healthy financially, the incident reflects the need for aggressive content moderation and following industry norms. Moving forward, the company will have to deal with these issues if it is to establish investor trust and continue its growth in the competitive tech astrology market.
