Yeah, they used all the money on themselves. A free learning period so to speak. But, I wouldn't want to do that with investors money, reputation might hurt them in the long run.

One of the guys is a product manager at Google now, another moved back to his home town. Only one of them is still doing the startup thing.

They definitely got a lot of experience, this only counts if they learnt from their mistakes. Which, I really hope they did.