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If its completely different and shares nothing that can't be affordably transferred, why not close the first startup and open a second?

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I completely agree with that, and myself don't understand how it wasn't done over the course of four years and the development of a completely different product. I'm sure it's being argued somewhere in here!

Four years in and just now doing a seed round. They were likely young, inexperienced, and mostly technical. Unfortunately, technical people don't always think of those ramifications.

And it was probably a series of pivots along the way that individually didn't look at big, but over time transformed immensely.

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