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Founding a funded startup which doesn’t work out largely does not and should not irreversibly damage the founders’ finances.
We should stop implying this is routine and stop valorizing courses of action which increase likelihood of it happening, like not taking salary.
We should stop implying this is routine and stop valorizing courses of action which increase likelihood of it happening, like not taking salary.
There exists a culture of “burn all your ships” bravado which does not do us favors. Many who “burn ships” have a high-quality backup plan; the perceived necessity of “burning ships” chases away people who do not.
“What happens if your startup goes bankrupt?”
It sucks. Royally. But you do not do not do not backstop its debts with your own money. You spend the last (paid!) month or so of your employment making sure your employees land as best as you can and directing advisors to wind down.
It sucks. Royally. But you do not do not do not backstop its debts with your own money. You spend the last (paid!) month or so of your employment making sure your employees land as best as you can and directing advisors to wind down.
Then you do whatever comes next, which is possibly a breather (at your option), possibly immediately doing another thing, or possibly getting a job. The direct economic consequences are within normal tolerances for the gainfully employed professional you have been since taking $.
“Is this different for bootstrappers?”
Complicated, but very important to realize that when you sold 10%+ of your future outcomes to professional investors one of the things they were very explicitly buying was 100% of the downside risk.
Complicated, but very important to realize that when you sold 10%+ of your future outcomes to professional investors one of the things they were very explicitly buying was 100% of the downside risk.
