Did they really burn through their $4.85M from their Series C in 6 months?
If you haven't turned the corner after 5 months, you know you won't get out of the hole before you run out of cash.
Therefore, you sell the company and reduce your burn as much as possible to make a sale happen.
If your sale is all about talent and not the technology there is almost no due diligence required and a deal can happen quickly, in about a month.
Some tuning on that, and I'm fairly certain you could run things for less than $500,000k a month -- most files are probably uploaded, downed a few times in a week or two by a select number of people, and then forgotten.
Then again, and this is key here, I have not tried this. It's also something that could be difficult to patch into codebase if it wasn't considered early -- we're all familiar with the problem of coding ourselves into corners, especially when time is on the table.