Hacker News new | past | comments | ask | show | jobs | submit login
Ask HN: My company went bankrupt today and I have 2 options
76 points by egesabanci on Feb 19, 2024 | hide | past | favorite | 86 comments
I am a software engineer and entrepreneur, I have 5+ years of experience. During all of these 5+ years, I was building my startups (2 of my companies failed, and I currently have a small team where we develop in-house mobile apps, but we are not generating any revenue at the moment) while I was working as an engineer in software companies on a salaried basis. So you see, I had a "safe" entrepreneurship adventure.

Today I got the news that the company I have been working for the last 1.5 years went bankrupt. They were operating in the fintech sector.

From the very beginning, I always wanted to be a tech entrepreneur and I dreamed of one day quitting my salaried job completely and not coming back. I wanted to do this not because it was cool, but because I wanted to be the decision maker on the technology and business issues that I developed with my own team and I wanted to do great things together with my team.

You know those ridiculous motivational videos that say entrepreneurship is all about courage and a little bit of misery at the beginning. But after a few times when what you build fails, you start looking for "safer" ways of entrepreneurship.

Right now I have two paths in front of me: get a new job and continue being a part-time entrepreneur (I know the shortcomings of part-time entrepreneurship all too well) or I can go full-time and bet on one horse and hold on as long as I can and hope that my startup will succeed in the meantime.

There is no such thing as "safe" entrepreneurship, yes, I am aware of that, but I am trying to make it "safe" since I don't see any silver lining in my ventures yet (we have good plans but most of them are uncertain at the moment).

What kind of guidance can you give me? What would you suggest?




You haven’t really said much about your personal situation and in this scenario it’s very important.

- Do you have a family or other dependents?

- How much do you have in savings?

- Could you fall back on e.g. moving in with parents in the very short term if things go horribly wrong?

Entrepreneurship is a wonderful adventure but at a very base level you need to be able to put a roof over your head and eat. As long as you’re able to do that even if your business completely fails, go for it. If you don’t, take the safe option, build up savings, then go on your adventure.

Also, to be blunt: is your idea any good? Do you have domain-specific knowledge you’re able to leverage in your market? I sometimes find people who are putting the idea of entrepreneurship ahead of any specific concept fail because they’re not actually passionate or well positioned, they just want success.

Taking a job also isn’t wasted time. Going back to the criteria above, in my day job over the last few years I’ve identified a few SaaS concepts I know my employer would very gladly pay for, and I imagine others would too. I’m not in the situation to execute on any of it right now so I’m going to stay right where I am, but I hope to pull the trigger sometime in the not too distant future.


> Do you have a family or other dependents?

And, if you are in the US: Does your spouse have health insurance and a salary that can help support the family? Do you have kids in high school getting ready to start college (runs about $30k-80k per year living on campus)?

Family finances aside: If the product has true potential - meaning customers not only say they like it, but they are ready to pay on the spot - then look for ways to keep it going.

FT job or consulting are potential solutions to the income problem. No shame in doing either, despite what VC crowd might say.


This advice is so important. You can't look only at the income side of things. If you are a single person renting, you have a completely different risk profile than if you are the sole income earner with 6 dependents with a mortgage.

So any other advice in this thread is useless without more context, IMO.


The other question missing is: Do you have solid co-founders to do it with?


There's a dangerous line of thinking around "my business isn't producing revenue because I'm not full-time focused on it." I've fallen into this trap and learned the hard way that full-time focus was not the issue.

You have a team for in-house mobile apps, but you don't have any revenue. Why is that? How will you fix it?


> you don't have any revenue.

That is what struck me also. You could try and extrapolate on some revenue and growth but there isn't that. It's not because of "part time" procrastination since there is a team working on it. What's happening? (We don't need to know but you need to know.)


Very true. Focus is overrated.

Most "mobile app" ideas can be validated fairly easily, with a few weekends' worth of time at most. Put your MVP out there. Spend a few more weekends fixing problems and responding to user behavior. If it doesn't generate any revenue, throw it away. Try something new. Rinse and repeat. If you finally stumble on something that sticks, then you can allow yourself to focus on it full-time.


I think this is a very valuable insight, especially in the consumer and small/medium size business. I have fallen into this trap before.

One area where I would say that full-time matters more is if your product's target is big enterprise customers. Those are a bit harder to sell bootstrapping/moonlighting.


For sure. Big challenge with those companies—that I found—is that they want a lot of credentials + proof that are simply outside of the reach of small businesses. So even if you're full-time, it may be a "good luck" scenario.

Although SOC2 is fairly easy to get, it's expensive for bootstrapped founders (maybe $30-45k all in.)

It wasn't enterprise, but the 600 person company (that I knew very well) simply wouldn't work with us in the end because we were too small (2 of us.) It sucked, a lot, because the deal cycle took about 18 months to get to a firm no. Since then, everyone involved has left the company


SOC2 (Type 1) doesn't have to be that expensive, not counting your own time. For a very small company, it can run as low as $12-15k. Shop around.

Don't invest a lot of time in individual deals when you're small. Aside from the time and probably attorney fees (and opportunity cost), it's pretty demoralizing if it doesn't come through, and most of the time it doesn't, especially when you're small. The distraction alone can kill your company.

Focus on many smaller deals rather than one or two big deals.


Agree completely. Going after small deals ruthlessly would've been my biggest change. We were trying to, but so much was wrong with the actual way we were trying to sell.

Btw the price comes from my latest adventure. I think 12k is too low unless you can literally do everything without help (i could have but it would've destroyed my time.) 20k is probably a realistic price floor with pentest included.

Although type 1 doesn't require a pen test or you to actually do anything. Just to say you would do it a certain way. Every prospect that has asked for SOC2 has wanted a separate pentest deliverable.


> "my business isn't producing revenue because I'm not full-time focused on it." I've fallen into this trap and learned the hard way that full-time focus was not the issue.

What was/were the issue/s if you don't mind me asking?


It’s always product market fit. If the product is right it will find users.


Nah, that's not the right answer. It puts focus on the product rather than the founders. You do NOT need PMF to get 1-5 sales. If you can't even get there, it's bigger problems. PMF is needed to turn 2k MRR into 50k MRR.

In my case, it heavily stemmed from our inability to do sales (at all). We had feedback early about how this was an $XXXXX product (and we were in sales process for that) and it put blinders on us. We should've been okay with $XXX and grabbed 5-10 customers early.

Why we couldn't do sales is something I'm not going to put on the internet because it affects people other than me. (I have no issue talking about my shortcomings.)

I left that company and started another with a proven sales/marketing type within 2 months. The story is much different than my first. It's because he can sell.

Funny enough, I have a license to use my old product w/o selling it, so we do. We've gotten at least 10 customers asking to buy it. And they're fairly emphatic about it.


> Nah, that's not the right answer. It puts focus on the product rather than the founders. You do NOT need PMF to get 1-5 sales. If you can't even get there, it's bigger problems. PMF is needed to turn 2k MRR into 50k MRR.

It really depends on the product/market. I've worked in a startup with a competent founder who was great at sales, and which nevertheless, after 2 years, went bankrupt without making a single sale. Our product was targeting enterprises in a specific niche - there were perhaps 10-20 or so potential customers worldwide. Making even a single sale would've been huge.


>> Why we couldn't do sales is something I'm not going to put on the internet because it affects people other than me.

I can appreciate that but I am wondering if you can share what you think are core skills, habits, or personality traits that are critical in order to make sales happen for a new business/product.


Sure, I can do that. This isn't an exhaustive list, of course:

  * Don't be afraid to ask for the sale
  * Be comfortable "closed lost"-ing a deal instead of having non-productive conversations (SOGOTP)
  * Recap all meetings with prospects or customers (email sent to them with information such as about your product, your call with them, their painpoints, next steps, etc.)
  * Leave meetings with a tangible next step. Someone not wanting to schedule another meeting is a huge red flag
  * You don't need a sales process or methodology, but you might if you're not able to effectively manage your deals.
  * Be comfortable living in the present and future, as you want early prospects to help shape the future with you.


Yeah, there's no amount of dedication that will make the business fly if you stubbornly want to do “your thing”. You have to do what the market can find and is willing to pay for. Many of such businesses can be discovered without starting full-time.


It seems as though a lot of startup founders and product managers succumb to this illness. I've worked for a number of startups that have always had a number of people who were building things for nobody but themselves. These features, and in one case - product, were not anything any customers were willing to pay for. Instead a lot of these founders think it's their sellers and double down on ineffective solutions like thinking something such as MEDDPICC will solve the "sales" issue, except what they should be doing is having honest conversations with prospects and customers.


Founders should be doing sales (not leading it, doing it) until at least 1M ARR. That solves a lot of that issue.

Maybe it's a difference between bootstrapped mindset and VC-fueled one.


I would argue there's a soft spot at around $10M ARR where founders turned full time CXO lose focus and touch with their product. They turn it over to folks who don't seem to carry the customer focus but instead have a focus on building their version. It doesn't seem to play out well and I'm curious why this seems to keep happening.


I agree with this, although the timeline differs a bit between companies. I was at Salesloft from 1M ARR -> 100M ARR, so I saw this roughly play out. However, I will say that the founders did an exceptional job staying close to the product well after 10M ARR.

I think a lot of it is due to the VC playbook. The question of "who am I building my business for?" looks a lot different between VC and bootstrap. Once you start getting into heavy hitter revenue (grain of salt, I've never done this as a founder), the machine starts working largely on its own. It's probably more impactful to spend time on the business systems instead of the product.

But bootstrapped founders seem more likely to stay close to the product for longer. Eventually they may want some sort of out, and you see the playbook execute much much quicker.

Now, I have other theories on why it doesn't play out well. Going from 10M -> 50M ARR is a huge hurdle. You have to really level up a lot of the business itself to do so. It might be that it's just not possible for a lot of companies to bridge the gap. I think it's easier to go 50M -> 100M than 10M -> 50M.


> Maybe it's a difference between bootstrapped mindset and VC-fueled one.

The bootstrap mindset understands that "idea man" isn't an actual job.


PMF is not only about the product being right for the users but also reaching the users who are interested.

Marketing / Sales can be a blocker too.


If you have to ask, go get the job. You might make a big, successful bet on something you're not totally sure about later in your career, probably because you'll be getting the opportunity to work with specific cofounders. But that's much less likely to happen if it's your own idea/company that you're leading by yourself that you're not absolutely sure of.


Are you actually looking for advice or hoping we will validate your feelings about wanting to go out on your own? Because there’s not enough detail here to actually offer any actionable advice.


> There is no such thing as "safe" entrepreneurship

Of course there is!

It's safe if you can afford to take no wage, invest lots of money, even more time into something that might not work.

It's only unsafe if you can't afford to lose the business and everything you put into it. If it would mean you and your dependents not eating, becoming homeless. Even mild financial pressure is more than some relationships can take.

The danger of following others into entrepreneurship is you see the successes of the very lucky and the failures of the people who could afford it, who tried and tried and tried again. You rarely see the people utterly destroyed by their mistakes and poor luck.

Your situation matters. You aren't the people you've seen before.


Most ideas people have are rubbish so won't generate any revenue. When you're not generating any revenue then that should tell you that your widget is no good. Don't take that as an insult but the reality. So many startups are filled with folk who have wishful ideas but business is brutal and a no-good idea is just that. Do some market research to find out what is a useful widget. Few startups get lucky like Facebook and Google who happen to fall into their big area of revenue generation. That's pure luck and they have a graveyard of failed startup ideas. 99% of startups are rubbish that deserve to fail and are a waste of time.


“We are not generating any revenue at the moment”

All of the advice given so far about your personal family life is important and should be considered…

BUT…

You should attempt to get a job in B2B tech sales before picking up entrepreneurship again.

You lose nothing by taking the time to learn. In fact, see it as part of your business journey.

As a fellow engineer, I empathize completely and had to unlearn a lot of things to become successful business.

Best of luck.


This is a great answer also. You have a no-brainer and resume-safe opportunity to switch job. Do you need to learn sales or some other skill? Watch for IP and confidential information but otherwise that might be time to do a little time in a different part of business organizations. Sales, recruiting, marketing, product management... Which one might depend on the entrepreneurship you are aiming for.


> You know those ridiculous motivational videos that say entrepreneurship is all about courage and a little bit of misery at the beginning.

The purpose of motivational videos is to sell advertising targeting the sort of person who watches motivational videos. That's it. Shouldn't be taken at all seriously (or watched at all, really).


Do you think your previous 2 companies failed because you didn't spend enough time/energy on them?

If so, then yes, go for it! Life only happens once, and if you screw up, there will surely be another job you can get at a later point. If not, maybe continue playing it safe until you feel a bit more confident about what went wrong, so in the future you can give it a go full-time.


I don't see how you can work assiduously at a full time job in fintech while also trying to launch a tech startup, and expect the startup to succeed. Unless you have some absolutely revolutionary idea with well-protected IP, someone else more dedicated will probably out hustle you with a similar enough idea.


This is not a personal advice as I'm also in that badlands of struggles. However, today, I read a nice comment from an acquittance from my prior world of the web and awards and stuffs (I was a regular judge for an event he runs). Here is me trying to remember and paraphrasing it (not verbatim - I need to look around).

   Entrepreneurs don’t go around calling themselves out as “entrepreneurs.” It’s not something to focus on and something that needs a “system.” Follow your passion while treating your customers like you want to be treated yourself.
In short, can you find ways to get paid for by the customers for whom you are doing something?


This should be on a billboard or carved into the side of the Santa Cruz mountains in Silicon Valley!


Your best course of action depends on a number of variables: your recurring/anticipated expenses, your savings or other access to cash, how speculative your business is, your risk tolerance, family obligations, and so forth.

So in lieu of answering the unanswerable, I want to offer some advice that applies either way: sit in the uncertainty for a few days, if you can, before you try to evaluate your options. You must be feeling pretty anxious right now, and that’s not a place of objectivity. Tolerate the uncertainty for a bit and the facts will be clearer.


Your definition of 'safer': Is it about financial security, flexibility, or control over decision-making?

Your risk tolerance: Be honest about how much uncertainty you can handle, both financially and emotionally.

Support system: Do you have people who can offer support (even practical help) on either path?

Before you decide to go full-time: Analyze your current startup's potential, your financial runway, and have a fallback plan for the worst-case scenario.

Before you decide to go part-time: Be realistic about limitations as a part-time entrepreneur.


Start smaller. You have to walk before you can run. I might be biased because I've tried and failed at a few startups, but this is what I'm doing:

Try building smaller / easier businesses first. Try freelancing or try selling something, anything, like a course. I think there's a very strong correlation between who can make it as freelance and those who can make it with a startup. The market is validated, and you'll get experience in selling, branding, marketing, etc.

Unless you live in Thailand or Bali, I don't see much option for mitigating risk here. Having a freelance/consulting business is going to do wonders for your entrepreneurship career. It'll give you more control over your work schedule, so you can keep making bigger and bigger bets. Just make sure you get high-value clients so you can make margin. Otherwise you'll be hunting for work all the time.

Last piece of advice: don't listen other people (LOL). Everyone has an opinion on how to be an entrepreneur and what 'true' entrepreneurship is. Focus on yourself and where you want to be and how to build a life where you can keep taking shots at the goal.


> What kind of guidance can you give me? What would you suggest?

It's really about matching our obligations (family, kids, rent, etc.) against your runway (sales, funding, being able to pay yourself).

If those two things work - then go for it. If not, then you have your answer.

Another way to look at this is that the 'game' phase of your startup just had the clock run out. Did you get far enough to make it full time or not?


Just one comment: I think the way the title was worded is rather ambiguous. I came in here expecting the company you founded “My company” went bankrupt. It would be much less ambiguous if you said [The company I worked for] instead, as your post makes clear.

I realize that OP does not speak English as a first language so I offer this as a gentle suggestion. Good luck in your endeavors OP


I'm an entrepreneur (luckily with one successful tech startup) and along the way I've had many failures. I've also helped many other startups on their journeys to becoming very successful and the truth is your journey is something you will need to decide.

But, from my experience I've now realised you shouldn't work on your idea with your own money. It's great if you have enough savings to do try something you love but the point of a startup is to make money (unless it's a non-profit). In order to make money you will need to convince someone else that it's a good idea and pay for it.

So, validate your idea before you go full-time and get some early customers. There are many ways to do a "safe" startup. There's always a risk but you can make sure you don't end up worse after a failed venture.

I'm new to HN but I suspect there are many who'd be willing to help you and complement your skills to make your idea successful (I'm one of them).


Everyone wants to not work for someone else and be the decision maker and lead a team. Entrepreneurship starts with being a builder.


I had to start my own company because I couldn't get a job doing what I wanted to do. I kept being told that I didn't have the degree I needed. There are no degree requirements for CEO.


Eh… most of the people I know are much happier not dealing with the overhead of running a business.

We work 9-5 so we can have money to live.


> Everyone wants to not work for someone else and be the decision maker and lead a team

Speak for yourself; can't think of anything worse, myself. Very happy to let others take care of that sort of thing.


I think there's some kind of echo chamber or distortion field among entrepreneurs, which makes them believe everyone's goal in life is entrepreneurship, "being your own boss" and some nebulous idea of "success".

It's really not. I'd much rather minimize the amount of stress and working hours in my life, thank you very much.


I think many are just delusional.

For me, the risk/reward of 9-5 is so much better than going into business for myself that it isn't even close.

The utility of a 10x-100x increase in the payoff over 9-5 is just not worth the sure bet of 9-5 for me.

This is even more true when so many want to be in business for themselves.


I don't.


Woohoo.


If you really ask yourself, then you know what you will be comfortable with, no one else can answer that for you.


Yes, of course. I am just wondering what would you do if you were in my shoes.


Why did the fintech fail? Was it poor market fit, failure to execute, or insufficient capital?

Can you approach your previous customers and ask them what they want? Maybe you can collect some other previous employees and start a new firm in the same space (but do it right)?


I live in Turkey and the company which went bankrupt was in Turkey. The financial regulations and national economy management (especially the last 3 years) are too strict here. So, there was nothing much to do.


> I currently have a small team where we develop in-house mobile apps, but we are not generating any revenue at the moment

That can easily become a job. Definitely a safe way to get into business management, over being an engineer.

Once you have some profits you can even try to get your team to work on some small products and try to grow it slowly. Don't bet everything you have or raise money and either make a unicorn or fail; just provide value in sensible way so that you can make a profit with little resource (money, time) investments.


This really depends on your runway and external stakeholders in your life.

If you go for this, how long do you have until you _need_ to start generating enough to pay yourself?

Do you have any spouse, children, .. that you need to support? (and which might mean you get unforeseen financial strain?)

I'd say we're in another golden age of entrepreneurship. A one man shop can create things that would have taken teams even just years ago.

However, there's nothing wrong with working a real job until you are financially independent enough to fully commit yourself to this.


> because I wanted to be the decision maker on the technology and business issues that I developed with my own team and I wanted to do great things together with my team.

Why if you have no experience ? I never understood that. You have 5y of experience, which isn't a lot, in small start ups. And you want to be a decision maker ?

I would course correct to try to work in bigger companies and learn, instead of dictate.


I don’t think it’s an either/or situation.

In your shoes, I would spend a couple hours a day prepping for interviews and applying to jobs. I’d work on my business the rest of the time.

If you get a job offer you like, take it. If your business takes off, even better.

Depending on where you live and how strong your network is, it might take longer than you think to line up something new. Might as well work on your business in the meantime.


Why do you have a small team when you can build it yourself?

I would advice, given that you have money to spare, to go solo full-time on whatever project you're building because that will let you build at it for a longer period of time. Create an MVP asap and if it fails to generate revenue fast enough, take part time jobs as a contractor to finance your passion project.


Being a bootstrap entrepreneur is about making money. Misery could help you focus or delay your future success.

I don't think you figured out how to sell. I don't think you figured out what to sell. But you are a great leader who can implement a vision and build teams.

I think you should go back full time until your business forces you to quit.


Based on the information provided I can't suggest anything because only you know how much money you have in the bank and how likely it is for your business to generate revenue anytime soon.

I'd go back to work unless you have cash which you are willing to burn for 1-2 years.


You could start a new service based company. Offer your skillset and your team's to clients, hopefully on a retainer-based agreement so that revenue is a bit steady. Then use the team's extra time and yours to create your own products.


I’m not sure how many fintechs have found success with a “part time” anything


You should read the OP again.


I see that I combined part time and fintech inappropriately, thanks for clarifying.

“ I have two paths in front of me: get a new job and continue being a part-time entrepreneur (I know the shortcomings of part-time entrepreneurship all too well) or I can go full-time and bet on one horse and hold on as long as I can and hope that my startup will succeed in the meantime.”

if you’re committed to entrepreneurship, there are not two options. Only 1. Go for it

Bootstrapping a business starts small though, as others have mentioned.

There is no part time, or half in. You’re in if you want it and you pound the pavement every single day.


Do you have a business or a project?

That is, are you generating revenue with a model that can be scaled? Or, are you just building something that you think people might want? For the former, I'd get a job.


Do you actually know how to run a business? Saying it's all about courage and other such nonsense suggests not. Maybe get a safe job and study business/get an MBA?


Maybe try freelancing first as a step in between, then you can slowly adjust your hours the more money is coming in from your own project while still having a safety net.


Your other option is to get a steady part-time job that at least covers your basic living expenses, and work full-time on your own business.


Do you have a family? A mortgage? Other responsibilities?

If you don't have any of those things, move to a country with extremely low cost of living.


A mid path might be contracting. Decent pay when you do it and can do startup stuff between contracts.


If you have to ask you're not ready to go out on your own. Get a new w2.


> What would you suggest?

Go for it like your livelihood depends on it.


How much in savings do you have?

And there is nothing wrong with working on your startup while working a salaried job. I don't know a lot of millionaires or family bank owners so most founders are trying to bootstrap with their savings and salary. And it is longer and hard this way.


90% of ventures fail. Be defensive...


That was the figure my business subjects at university quoted...


Get a real job.


"INSUFFICIENT DATA FOR MEANINGFUL ANSWER."


Becoming an entrepreneur because you want to make the decisions isn't enough of a reason. You also need an idea that's so good, you must see it through and make it a reality. If you don't have that idea, get a job.


DHH from 37 signals has good advice about this


What’s the advice?


Kind of sad to think that a company just went bankrupt, while their employees were working on their own companies instead. No blame for OP. But what should managers do in challenging situations to prevent their team from losing focus?


Why would you jump to the conclusion that a bankruptcy after 1.5 years is the fault of the underlings and not of leadership? Especially in such a shifty, cutthroat, regulated, and nuanced industry as fintech.


I could not agree more.


This depends on the country. Some countries the expectation is you work your contracted 35 hours, and all the rest of your time and energy is yours to use as you please - including having a side-hustle.

The existence of all these side hustles in that case probably wasn't the reason the company failed.


> But what should managers do in challenging situations to prevent their team from losing focus?

Force them to spend 12 hours in the office, of course.


Or sleep in the office. Worked for FTX.




Consider applying for YC's Fall 2025 batch! Applications are open till Aug 4

Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: