I don't understand business much but it looks it was really nice of them to return the money to investors. They could just let the investors bear the brunt of their bad investment without giving a damn.
Not if they wanted to continue running the company.
At the time, we didn't entirely know whether there were still growth opportunities or what else we could try if we kept going. But we knew we wanted to keep trying. Some of our investors wanted out, and we gave them (and all the other investors) the opportunity to sell their shares back to us. It means everyone who wanted it got their money back (which for an investor is not actually a very good outcome, but better than $0), and we got to keep the company. I'm appreciative of them allowing us to do it.