
Ask HN: Failed startup, lost $110K need some advice - wheretonow
My company&#x2F;startup ended on the 90% side, about $110 in debt. Was trying to make it without VC money, but the company fell victim to our inexperience. Learned how hard it is to find help. Debates went on but no decisions were made. No proper wireframe we were winging the process with only one dev. What do I do now? Any one else on same boat? or have expreinced failure ?
TL.DR; Failed startup, guy loses $110K need some sage advice
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sumanthvepa
Hard to give advice beyond the generic platitudes in a forum such as this. But
some observations:

Only one dev is not so much of a problem, provided that one dev is the founder
and/or is seriously motivated. VC money or lack of it is also not a problem.
VC is primarily only useful to acclerate growth not find product/market fit.

Not being able to service your debt: That's fatal.

So priority #1: get revenue to service the debt. If your company is not in a
position to sell anything yet to service the debt, get a job and service the
debt out of salary. Going forward, cut expenses, and keep the burn rate low or
even zero. Then focus on revenue. Depending on your situation this may take
anywhere from a few months to a year or two. Try and hang in there, but don't
be irrational about it. If your exceeding your financial limits: stop and
shutdown the business. Post-failure is not as bad as you might currently
imagine it to be.

~~~
nicholas73
I've lost over that amount in stocks before I learned to never invest in a
company that is not making sales. It always takes longer than you think, and
while you wait your investment declines in the form of dilution or debt.

It's the same thing for your own startup. Do not take on debt unless you have
a sale, and the debt is for fulfilling the order.

On the brighter side, I eventually made the money back through my investments
and you will do better next time. It seems in business there is no way to
learn other than the hard way - I learned more about psychology than finance.

Also, since you were extended credit, you probably are doing better
financially than it sounds. That is, you have some asset backing the debt. So
the greater challenge is forgiving yourself and moving on rather than the
financials.

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jeffmanu
Yes I know the feeling. What I did was I found out the single most engaging
feature/benefit of my product and built that into a business. I used
contractors instead of a full team to lower costs and financed the startup
from a salary I got from a new job.

Email me at jeff@growingstartup.com if you have any other questions.

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charlescearl
Although I don't know your particularly situation and where you live, if you
are US based you might want to consult an attorney or accountant who has
worked with startups.

One of the motivations behind bankruptcy (chpt 11 particularly) law was to
mitigate the losses that entrepreneurs are likely to encounter given the risk
that they take on -- at least this is what I've been told by accountants
across the political spectrum. This may also address any personal financial
losses that you may have encountered.

 _Feel free to ignore the political dig_ but this is smart business
apparently: [https://www.washingtonpost.com/politics/2016/live-
updates/ge...](https://www.washingtonpost.com/politics/2016/live-
updates/general-election/real-time-fact-checking-and-analysis-of-the-first-
presidential-debate/fact-check-has-trump-declared-bankruptcy-four-or-six-
times/?utm_term=.fa29e3fb30be)

