Some things which have helped me are to stop thinking about succeeding or advancing in life. Those goals are so high up most people don't even get close. OP got very close by being funded, and it sounds like the whole experience was a let-down over and above the business failure. It sounds like the OP has let go of those dreams, which is necessary especially once you know the dark side of those dreams.
Most people are just trying to survive. They have little control over their lives, and that relieves some of the self-blame when things go badly. It is okay to not be in control, to need help, to lose. That's where most people are. You have friends and allies.
Now that you know how the system works, would you feel better about yourself had you succeeded? Would you feel guilty?
I think OP is being too hard on himself, and he should look back on that experience with pride. "I was good enough that they gave me a shot." You could have been a contender. You actually landed a punch.