Crucial Conversations

Had a discussion yesterday with a founder who after 3+ years of struggle decided to shut shop. I am an investor in his company, and have seen what he has been through. I have also been on the other side.

Shutting down your dream sucks. It’s embarrassing. It’s like a 2x4 in the stomach because you’ve let yourself, your customers, your team and your investors down. You’ve lost money, time, self respect and possibly, trust. And by definition since 9 out of 10 startups fail, it happens much more than we think, we just don’t see as many proclamations about it on LinkedIn. When it happened to me I wished the earth would open up and swallow me.

There is a way to do it right. Own it. Be transparent about the why. Hopefully this wasn’t a surprise by the time it happened because you’ve kept your investors in the loop. Share the mistakes you made and what you learned. If there is money left over, tell them specifically how you’ll shut the company down and give it back. How you’ll get them the capital loss letter. The details matter.

I left the call knowing this kid will leverage the lessons he learned and do something else one day. More importantly I realized that in these situations you feel much worse as a founder with the one dream you just killed, than an investor with a portfolio where someone else might make you whole. Especially if you’ve been on the other side and were lucky enough to have mature investors, and supportive friends and family who knew you did your best. And if you’re really lucky like me, they helped you get back up, dust yourself off, and punch back harder.

To all those who helped me get up after I fell, a big thank you. It taught me a valuable lesson on how to handle this situation. I could not have been as generous to this founder had you not been as generous to me.

#crucialconversations #dustyourselfup #punchbackharder