Ask HN: When do you know your startup has failed? | Hacker News Reader

Ask HN: When do you know your startup has failed?

325 pointssuperpi173 comments

I'm currently going through a mini depression. We've gone without salary for the last 4 months, abandoned our business model to do pay for hire work in the hopes of trying to raise money to keep the lights on.

Honestly I feel like I'm going to be evicted from the house. My rent is already up, and as of now I have < $1 :).

My partner is fine actually, he has rich parents and doesn't really depend on the startup for income. Which actually gives my friends and family the illusion that we're both killing it.

We have almost 0 chance of raising more money, it's much harder to get money it seems if you're in a poor country.

So, if you've had a failed startup, how did you know? Did you run out of money and call it quits? If you succeeded, did you have a patch so rough that you were evicted?

I'm 25, I feel like I'm losing at life already. It was okay to be broke earlier, because it's expected. It's not anymore, when almost none of your peers are. Also, I'm not in a developed country, where being broke means living on ~$1k a month. I've been living on ~$200 a month.

Anyway, I just want any input from you guys. Like anything, I just wanted to get this off my chest. Not even sure I've really expressed what I wanted to express (English isn't my first language).

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You're done with this one (because it seems you lack energy and conviction to continue), but: You haven't lost at life and you're not losing at life, you've gained something extremely valuable: experience.

Find a job, recover for a while (or if your partner is really wealthy kick back for a week or two and do absolutely nothing until you can't wait to get back to work, if you are from such different backgrounds it would not be outrageous to ask for a bit of support from that direction) and then try again, the start-up world does not care as much about your failures as it cares about your experience and you'll do much better the next time around, I guarantee it. Been there, done that, have several t-shirts, failure is absolutely ok and simply the expected outcome so don't sweat it. Best of luck and if I can help you or if you have concrete questions drop me a line, email in profile.

Apropos different backgrounds financially: that's a bad combination to start with, it means you will have a hard time keeping your respective goals aligned in the longer term.

If your partner does want to continue the business without you then that's fine, simply hold on to your portion of the business even if you don't work there any longer (your obligation to work stopped when you stopped receiving payment) or sell it to him (he can afford it after all...). And don't sell too cheap, keep in mind the company owes you at least several months back-pay!

To piggy back off this, some are easily able to go out and find a job after a failed startup, but it strongly depends on your skill set and where you live. Programmers in the Bay Area - easy, founders outside the US - this could be much more difficult, I don't know. What I do know is that doing a job search in a tough market after a failed startup, with no money and bills due, can be even more draining and depressing than seeing something you were so passionate about fail.

I don't want to get you down, but want to encourage you to look for the option that is best for you (the OP suggested starting another startup, if you can as well). It may be hard right now, given your emotional state, but if you are the type of person that has always been able to find creative solutions to problems (or ways to do things better) no matter what you are working on, then have confidence in yourself that you can add value by doing this in whatever you decide to do next.

As far as what to do next then, start small. Look for the easiest/lowest risk way to make $1. If it's manual labor - mowing lawns, cleaning houses, whatever, then go do it. You'll rebuild your confidence in doing this, and if you believe you are a creative problem solver (most founders are), you will see new ways to do your work as you go about it. You will also figure out new ways to scale, and build a business. It won't be an easy path, but you will start to feel better about yourself almost immediately, and that's what's most important.

My experience for failing in a developing country: it might take you to a different industry.

I was the technical founder in the startup and finding a technical job afterward became harder. However, I did get a job in VC and then PE because of my failed experience.

May not be the same experience as coding, but the pay is outrageously good + you get to know awesome people. In the end, you broaden your network to find even more opportunites to found ventures.

Might be too much to ask, but do you mind sharing some details on why it was difficult to find a suitable job in tech ?

Thanks for your insight.

If you're just an engineer(no seniority/management required), you'll be fine, but wages are low in my country.

If you wanna be an senior/lead/head engineer, many assume you weren't competent enough to manage the development of a product, even if it wasn't the reason the startup failed.

Thanks alot, from all the feedback, seems I'm better off applying for a job now, and recovering later. I've actually just sent a quick email to one of my contacts at a company I don't mind working for. Fingers crossed.

If you have the luxury take a couple weeks off before you decide for sure on where you want to start working again.

After the startup I was working at failed I thought I wanted to work at a big corp that was stable because I felt disillusioned by the failure of the startup. But after a couple weeks of talking to different companies and interviewing I realized that I wouldn't be happy working for a big corp even if it was risk free.

I ended up turning down a nice offer from a big corp and jumping on board another startup (a much more successful one though).

"You haven't lost at life and you're not losing at life, you've gained something extremely valuable: experience."

Very well said!

Is there anybody who wants your product? Do you have customers? Are they paying you? Is there cash that's just going straight out the door for hosting etc, or is there no cash at all?

I've run one startup that failed outright after 18 months with 10 grand still left in the bank, and I've run one that scraped through to become a success after 4~5 months of having nothing in the bank - I was sleeping on couches because I couldn't afford rent and my girlfriend bought me most of my meals - I got very close to packing it in. The difference between the two was that nobody wanted what we'd built the first time, the second time we were losing money, but people were paying us good money to use the product.

If somebody wants what you're selling - keep selling it, tell your partner that if he wants it to work he needs to put some cash in your pocket to keep your lights on and focus on the money, do whatever you need to do to get your customers to give you more. From where you are, the time for focusing on perfect product is over - you need to cash in what you've built. If you haven't built anything that anybody wants to pay for yet, forget about it, it's not going to happen this time - take a break, get an easy job, get some money and start again when you're ready. It'll be sooner than you think.

We had cash coming in, but it just stopped all at once. Like no one renewed their contract, so I guess that's a red light

[I've not been in your situation so please take my comment with a grain of salt.]

I feel there needs to be a closure. The "experience" that @jacquesm refers to is an understanding of what worked and what didn't. Solely based on your the comment above, I think you may need to spend some time learning why the cash flow stopped. Look into what lead to that situation and what could have been done different. Perhaps this may (as it's fresh in your memory) or may not (due to your emotional state) be the right time to do the analysis. People with more experience can chime in here.

Anywho, I don't think people who set out to do things of this nature can be failures. The experience and knowledge gained will easily put you above the median. Replenish & repeat.

This is a great comment. I have been in the OP's position. In fact, I technically kind of am in the OP's position (again) right now.

Personally (and forgive my language), when I look into what lead to the situation and what could have been done differently, my perspective on what happened changes as time goes on.

For me, stage one is "I'm a fucking failure whose head is so completely full of shit that I could make a fortune selling manure". Stage one is great fun because it is when I look at every single choice that I made and find the negative in it. This stage is completely irrational and is likely a symptom of mental illness. My brain usually just lies to me during stage one, so I usually prefer to get the most mindless job imaginable (delivering pizza is amazing) and spend my days listening to vinyl, reading books and lifting weights. I am in my late 30s, so this is a little too close to the plot of American Beauty for even my comfort, but so it goes.

Stage two is where the real growth starts. It is the "I'm a fucking failure because" stage. My startup post-mortems tend to come out of this stage - they are a point where I begin to focus on the particular choices that killed off my startup. All of the noise and ambiguity of stage one is gone, the emotional pain is still there, but it has been dulled by the knowledge that nobody can screw up 100% of the time.

Stage three is the "I learned..." stage and is the place where I feel ready to (as you eloquently say) rise 'above the median'. This is the stage where I realize that I actually did something...it didn't work out, but most crazy ventures fail. I did something, I earned my skin, and nobody can ever take that away from me. Strangely, in stage three, I usually laugh at how naive my startup post-mortem was.

The OP likely can't stop analyzing what went wrong, but at this point, it is just as likely that his/her brain isn't telling him/her the truth. This sounds like his/her first business and, I know that this is hard to believe, but it will get better. This feeling of failure will turn into a profound learning experience that will propel him/her above the median.

Once again though, excellent comment and huge respect for focusing on the positive!!

There is no difference between knowing when your startup fails compared to when anything else fails (eg. a relationship). It fails when you've lost hope for a future with it. If you don't believe that it's gonna work out, that's the time to stop doing it.

Great answer. Something fails when you loose belief in it. If she really believed in it she could ask for credit. The problem is that she doesn't believe in it anymore. Time to move on.

Imagine that you are swimming. In your hand you carry a heavy stone, you believe it is a diamond, but you can't be sure. Time passes, you are getting tired, you can't see land. What do you do?

Some people get so attached to their stuff that they sink with them. Be happy that you are not like this.

love this comment!

Stuff it in your shorts so you have another hand to swim with.

Good, but not good enough. Ask some successful founders if there was ever a time when they felt like all hope was lost. Very few will say never.

They may say and think they felt it, however I don't think they would have kept going if they honestly thought no hope at all was there.

The lows of startups are far more terrible than you probably think.

Didn't downvote but... the issue with this line of thinking is that of sheer numbers.

If you give 100 people a 1% of succeeding, but difficult times in the first years, and they all refuse to give up, after it's all said and done 99 will be depressed, estranged from friends & family, in debt, feeling like a failure etc.

And 1 person will be successful, and he'll do a PandoDaily fireside chat and talk about how he lived on a couch, and racked up creditcard debt, and woke up crying, but that he kept on going and is a billionaire now. And he'll command the majority of the media narrative around startups.

Of course I'm exaggerating to make a point, but the notion that most people fail and don't make it, and probably shouldn't continue after some point is completely true.

It's the same line of thinking that says 'well Bill Gates was a drop out, and so was Zuckerberg etc'. It may say that dropping out is not the end of the world. (similar to how being at a low point in a startup is not the end of said startup).

But it also carries the implication that dropping out is somehow not an issue, or that being at a low point in a startup is just a phase. For the majority of people, dropping out carries consequences, and being at a point where all hope seems lost, is usually rightly so the beginning of the end of your startup.

Expecting endless perseverance by looking at the tiny percentage of hugely successful startups that went through difficult times, ignoring the much bigger number of completely unsuccessful startups that went through difficult times, is probably why people downvote your post.

As the OP doesn't appear to have traction, have any semblance of salary, shifted to do freelance work and didn't provide ideas on how to pivot, I think it's probably time for him or her to put this one in the freezer and try something else.

edit -- weird thought you mentioned getting downvotes. Might be going crazy :)

http://en.wikipedia.org/wiki/Survivorship_bias

http://en.wikipedia.org/wiki/Expected_value

If your strategy involves doing something that eliminates your upside potential, while leaving downside potential, then the strategy has negative expected value and is a bad strategy.

If nearly 100% of non-consulting startups go through bad times, but you've chosen the strategy of cutting your losses as soon as you run into bad times, it's fair to estimate that the eliminating the upside potential may have lowered the expected value for that strategy to below 0. Might as well go gamble or just do a fun hobby in that case.

Non-consulting tech startups are particularly rigged against using this strategy of cutting out as soon as things turn bad, because it's typical that founders are forced to take a big loss relative to their alternatives until the very end when the exit happens. The norm is for it to always be financially worse than the more stable alternatives, until eventually maybe it turns good at the end.

Sounds like a sunk cost fallacy. The EV of startups could be negative, and probably is.

Sounds like? Is it or is it not?

I tend to think of Gates not so much "dropping-out", but pivoting, once he was convinced he could make it with software.

Absolutely, he only took a leave of absence (rather than dropping out) to try software, and once that took off in a huge way he actually dropped out.

It's also important to mention he got in at 73, and left late 75 with 2-3 years of education, and that he chose his major (applied math) because there was a rule that you could get into any class with the angle of applying math to it. So he was known then to go to many classes, as he still is to this day (he spends a huge chunk of his time on education, mostly books but also courses).

So yeah not a drop-out in a technical or figurative sense.

for some reason the Gates/Zuck drop out references always forget to mention what school they actually dropped out from

Exactly. Success is a quality of the person, not their education. Thus, in reality, dropping out isn't really going to matter one way or another.

This idea reminds me of the primary premise of a book titled The Halo Effect. It basically goes on to say that glorifying the apparent traits of highly successful companies is a good way to miss the underlying wisdom, if any, in addition to the possibility of just plain good fortune, that allowed the success of said company. Plus, even a person from a successful startup may be unaware or deluded of the true reason for his or her success.

It's not quite that simple, because both in startups and relationships you can lose all hope for a future for a time, recover it at some point and be successful. I would say you've failed when that situation persists for too long - something completely subjective and dependent on your pain threshold.

25 is young to feel like you are "losing at life". I was 35 when I started my first startup, completely bootstrapped. I ploughed all my savings (considerable amount) into the startup over a 5 year period, with lots of rollercoaster moments during that time.

From someone who previously earned a lot of money and now had a family to support, this was incredibly hard. I almost gave up a few times. Actually, I try give up once or twice by finding a job, but circumstances conspired to make me keep going.

7 years on, and things are much better now, and the business is actually doing quite well, and is a nice lifestyle business.

Seriously, 25 is young. You have loads of time to fail. Better to do it now, then when you have family obligations. That's when things are very different.

As someone contemplating starting my own lifestyle business I would be interested in hearing more details.

same here.

> 25 is young

25 is more like the end of the childhood, really :)

You have no idea how young 25 is until you're, say, 30. I didn't even find the right career path at 25. I just started in tech around 28.

My 90 year old grandmother told me 2 weeks ago how young I am. I am 42. It is never too late to do something new.

Indeed. My mother founded an educational software start-up at 60. 4 years later it's doing rather well actually.

>It is never too late to do something new.

Absolutely. Our individual lives aren't even a blip on the radar of life as a whole on our planet, let alone our universe. We get a very short amount of time to live, even shorter to live well (health, mobility, etc.). The idea of going to do something you dislike every day for 30-40 years of that very short time is just about the anti-thesis of what we should be doing with our time here.

You have no idea how young 30 is until you're, say, 40. :)

Yeah, I just turned 40, tell me about it :)

You have no idea how young 40 is until you're say, 50 :)

around 32 in my opinion.

Car rental firms won't even rent you a car until you turn 25, and that's because your brain has only just stopped developing.

Please get some perspective, and stop caring caring what others think. It's liberating to drop something that isn't working. It sounds like you might be in a culture where failure is shameful, but who cares. Hold your head high and say 'yeah, that didn't work out, learnt a lot, doing something new now'.

It's only a failure at that age if you didn't absorb any of the lessons. At least you didn't waste the time doing a useless college degree in a field nobody cares about.

I'm currently in your stage. Would love to hear more about your experience. How do I contact you?

FWIW, I didn't achieve career or entrepreneurial success until my 30's.

This startup has failed. Say it a few times. Take a deep breath. It's okay.

Now move on.

1) Get a regular job, take a year "off" from startups and just recover your sanity. It takes a long time to process the various emotions that come from this kind of intense failure. I've found a year is good for me. For some people it can be shorter, for others longer. Some people never get over it.

2) After that time, start working on new ideas.

3) If any of them look good, try again. If not, you at least have a job.

Money is the #1 problem in relationships, but what if you're the only one in the relationship? It's even worse, because then you're just fighting with yourself, and no matter the outcome, you'll lose.

Bonus for getting a new job? Almost nothing you'll encounter as an employee of an established business will come close to the stress of your startup failing. This will give you a different perspective about the workplace.

> Almost nothing you'll encounter as an employee of an established business will come close to the stress of your startup failing.

This may be true. But in my own experience I find myself continually pushed towards startups because established companies that I've worked at have had unpleasant HR policies and hierarchical weirdnesses. (It's a little depressing when a startup sets out to mimic that stuff.)

I've been there. CEO had rich parents and could do the startup indefinitely while I was seeing my peers do everything I've wanted to do while I was shit broke living on ~120USD in a third world country where nobody understood what I was doing ("You're smart why dont you just work at X. Look at Y's son, he's already working at Y"). Lost a lot. Lost money, opportunities, relationships, my youth. I quit, worked corporate (still working corporate) just to recover my sanity and finances and some semblance of "life". It's been one year and looking back it was the right decision. If you want to talk my email is in profile.

Hackernews tends to skew a persons perceptions about how hard it is to start and run a business. It's fickin ruthless and you have to be damn lucky. I feel very uncomfortable selling myself or my product to someone who can't really afford it, know damn well that I'm charging 10 times what it costs me.

But that's what you need to do to run a start up.

For the other 98% of people on this forum, a corporate job that pays the bills is all we're going to get.

I actually disagree--it's not at all hard to run a regular ol' business. It can be time-consuming, and it definitely requires mastering a different set of skills (marketing, talking to people, etc) than we're used to.

But if you wanted to start a one-person construction business, with a goal to employing a few people by the end of the year, no, it wouldn't really be that hard.

In any business, you're going to spend 80% of your time talking to people (and persuading them to give you money), 10% of your time building some fancy new product, and 10% of your time changing the product based on the 80% conversation time.

Not hard, just different. I guess, though, to the technically inclined, that makes it seem really challenging.

Spot on. Where else on this forum are the posts about how to do the 80% time talking to people. We talk about the product, how to make the product, what technology is used in the product, if it fails the pivot. There's not much to say about talking to people.... but 80% of your time should be spent doing it. 4 out of 5 days (more or less) .... when I go to work I spend 5 out of 5 days at my PC coding.

Yea, your startup failed long ago. You are just throwing good money after bad.

Here's how a business model works: you try a business model. If it works, great. If it doesn't, move on and try the next business model. You are either growing, dieing, or the zombie of living death. If it's the last two, get out now.

If you are a skilled person, then you can always get another job elsewhere, especially now that you've got "startup experience" on your resume. Conversely, if you aren't skilled, then that's probably causing your startup's failure, and that's not going to change.

Being overly optimistic is great when starting a company. You have to believe, against all odds, that you are going to succeed. But optimism death AFTER starting up, hanging on hoping things will change when they won't.

Growing companies have a chance of success. Dieing companies really don't. Zombie companies are even worse. Get out.

We've gone without salary for the last 4 months

Been there, done that. 3 times. It sucks. But I never lost hope. Your startup may be on life support, but you most certainly are not.

Honestly I feel like I'm going to be evicted from the house. My rent is already up, and as of now I have < $1 :).

Talk to your landlord. You may be surprised at the response.

My partner is fine actually, he has rich parents and doesn't really depend on the startup for income. Which actually gives my friends and family the illusion that we're both killing it.

Forget what others think and focus on your own future.

We have almost 0 chance of raising more money, it's much harder to get money it seems if you're in a poor country.

I have NEVER raised money. Every investor I've ever met has said "no" to me. So I bootstrapped. And that has worked out very well. Forget about raising money and instead start thinking about earning money.

So, if you've had a failed startup, how did you know?*

When I was broke and no one was buying anything. 3 times. All 3 times I got a job, recovered financially, and when the time was right, tried again.

I'm 25, I feel like I'm losing at life already.

Fuck. That. Shit. You're not old enough to be "losing at life already". I didn't do my first startup until I was 32 (it failed). So you're already 7 years ahead of me and I'm doing just fine, thank you.

It was okay to be broke earlier, because it's expected.

Forget what's "expected". Just be yourself. Your own expectations are the only ones that matter.

... when almost none of your peers are.

DO NOT compare yourself to others. You can never win that game.

Anyway, I just want any input from you guys.

You have not failed. You have learned. There are 2 things you have that 99% of your peers probably don't: the contents of your brain and the contents of your hard drive. You have already accomplished alot and no one can ever take it away from you.

Get a job. When the time is right, do it again. It's a marathon, not a sprint. You'll be fine.

I really like this, thanks!

Signing this...

Cheers to that

As someone whose startup failed failed way after it actually failed, this is the point at which a business fails: "We've gone without salary"

That's it. If a business cannot sustain itself, it has gone bankrupt. A bankrupt business is donesky.

But in my case it took being fired from the company I founded to face the facts. Not making salary is not cool. Not putting food on the table is even less cool.

Remember, you can't eat equity.

PS: I'm 27 now, the startup failed failed when I was ~23. It feels like a different lifetime. You will move on.

PPS: if you want to talk about stuff at length, email me -> swizec@swizec.com . Even a mini depression can suck :)

Well, if you're living off your savings to work on your startup, then it's officially failed when you'd rather get a job than continue to burn through your personal savings.

The maths still holds. When money in bank is less than this month's salary -> business failed.

Many early stage startups can't afford to pay salaries prior to raising capital. When I started working at a full-time capacity on my current startup, I went through 6 months without pay.

"If a business cannot sustain itself, it has gone bankrupt" might work for some more traditional cash-flow businesses, but I don't think that it applies very well to startups.

You had to have lived off of something. As I said in another comment, if there is less in the bank than it takes to pay this month's expenses. Then the business has gone bankrupt and has failed.

It really is as simple as that.

Reality is that many founders / writers / actors / band members / famous mathematicians and scientists have lived off of their spouses / girlfriends / family / side jobs / benefactors for a long time before making it big. Investors is no magic solution.

*Based on studies I've seen and hundreds of people I've talked to across these industries. Bankruptcy is a legal process that you have to initiate and won't happen if you refuse to initiate it.

I agree. They have. And that was their spouse/girlfriend/family/benefactor investing in them. Or in case of side job, themselves investing in themselves.

And whether those investors wanted anything in return or not, doesn't matter. Said founder/writer/actor/bandmember/mathematician still could not do their work if somebody hadn't put food on the table.

You really do have to stay alive and relatively healthy, if you want any chance at success.

I'm a bit confused by the reasoning too. We worked 18 months and put in 10s of thousands of our own money in the early stages prior to our first funding - a hefty negative salary. I think the only logical way to view it is that the founders are ALWAYS taking a loss relative to what they could earn elsewhere, for the life of the startup, until the very late stages or acquisition.

Very few investors will see it as a good sign if the founders pay themselves at or above their market rates, or if they do at or below the market amount of work. Likewise, the competition will punish startups for slacking or blowing money too fast.

but I don't think that it applies very well to startups.

Do you mean contemporary tech startups? As you may know, startups are businesses after all and the rules governing their operations are the same. When your business runs out of cash , you need someone to throw you a lifeline (debt or equity), or sell some assets to raise money or unfortunately file for bankruptcy and let nature take its course and creditors to recoup some of their investments.

Yes, your startup failed. That's OK. 25 years old is not old. It's OK to lose all of your money, it is almost a rite of passage for most entrepreneurs. You are lucky it is happening to you in your 20's, and not your 30's or 40's.

You have lots of time ahead of you. You are not "losing at life". Just keep pushing forward, however you need to. You will not die or starve. If you have no money now, it can't get worse. That is the good news.

You have dug yourself into a hole and getting out will not happen overnight. Stop dreaming about a unicorn investor that will somehow save you. The chance of that happening is slim. Focus on practical steps you can take to improve your situation, one step at a time.

Winston Churchill had something to say about your situation:

"If you're going through hell, keep going."

It fails when you want it to. Let te me tell you my situation:

Some of my projects have been getting a beating lately. One of my sales reps. just went missing. Just gone. For 4 weeks now. Together will a kinds of random stuff that makes me feel like this house of cards is coming apart. But I still believe in the product. We have clients and there are still ways to go.

I've put it all on hold for 3 months to do some contracting and cash-up, than it's back to trade shows and sales.

But I also think that having a startup is a luxery and (more and more) a marketing term that comes from the investent people. "Do a startup" and you can ask people to work 60 hour weeks. "Build me this product" and that same amount of work will cost you way more money and time.

I have been so blindly running my own products ("Startups") for 6 years, until 2 weeks ago I realized that contracting myself as a developer makes me 21k a month. I had no idea it was like that, I hadn't checked what all my newly gained knowledge has meant for my rates.

So what does it mean to you? If it is making you depressed, maybe don't do it? With SO MANY startups right now, it's very unlikely that you will make more money from it than from contracting. So are you in it because of your passion? Or to make money? Ask yourself these questions.

21k month? That sounds crazy (and amazing) to me as new frontend dev. If you don't mind me asking, what kind of development are you doing and how many hours are you working a month to make that amount? Might help me decide what to learn next : )

Assuming 70% utilization, you can make about 20k a month billing at $150/hr (or 5k/week).

and assuming 100% utilization you can make about 172k a month billing at $1000/hr...

You can plug in whatever numbers you like into any formula you like, but it doesn't help most developers earn more.

The reality is that most devs can't charge those rates and get significant amounts of work, because they don't have the required skills / experience / reputation, etc needed to distinguish themselves from the competition and attract clients that are willing to pay those rates. Obviously in some geographies it's easier than others because of supply/demand forces, but the vast majority of developers can't do this easily.

I think the real question being asked in most cases when people ask how it's possible to earn incomes like that, is what can they do to be ABLE to earn those types of rates. More helpful answers would be advice on what niches pay well and are in high demand, how to market themselves, etc.

If you die from hunger you can't expect to succeed in the startup.

Don't count on being the next big miracle.

My best advice is to talk to your partner. They are suppose to be as close as a spouse if not more. You need to make sure that they understand your circumstance. This will help you make a better decision going forward.

What we decided was to take time off and make money and come back after we've fixed financials. We believe in our partnership but felt maybe we did not execute fast enough or the business model wasn't strong enough at the time.

You should remember that not all the ideas work and that you can always try again unless you're dead.

Try to do a non emotional analysis first. An emotional analysis will make you quit at some point. Everyone has a few lows now and then; it only takes one of these to call it quits. Look at the numbers and prospects. Analyze this on the time frame of your needs. It looks, from your text, that you can hang in for six months at the most, and even then with some effort.

Look at the numbers. Is there money coming in? Are there sales prospects in the pipeline? When can the company free cash for your salary? Can the company cut some costs in order to free cash for your salary? The scenario, for a six month time-frame should be clear. Talk it out with your partner. Make sure he knows your predicament.

Then, and only then, look at it emotionally. Can you realistically make the effort? Assume there's a relevant chance it does not pan out. More so if the plans hang in undeveloped sales prospects. It's awfully different if you're about to close a couple of decent contracts than it is if you're just starting sales pitches.

Unfortunately, and any founder will tell you this, outside opinion is very unreliable. Hear from people that have founded companies. Everyone else has a different risk profile. I can't count the number of times I was questioned "why don't you take a corporate job? With your skill level, you'd be a demi-god.". Even other founders are biased. It's truly a personal decision, and must be taken as rationally as possible.

Wow! Thanks very much guys for all the advice. I actually posted this in the morning just before work, and just checkin on it now, I really just can't believe the amount of time you guys have spent trying to help me out. And this is all very useful. I'm going to get a job now and stabilise for a bit, before I try to start another venture.

Thanks again, I'm most grateful.

Have been in your boat. It's not so bad after it ends, your life does NOT end :).

I could get a job in a large company, at what I thought was an absurd salary, after I was done with my startups. At a time when I thought no one in their right minds would give me a job, given all the crap I'd done in my startups (and done no one thing for 3-4 years).

Are you in India? If you are please connect with me, and I will help you out.

Hi, I'm not in India, though I'd like to visit some time. Thanks for the generous offer

The worst is a zombie business; the ones that earn a bit, seem to be on the cusp of success, but also won't ever give you the clarity and just die.

Your business doesn't sound like a zombie, though. It is time to shut it down and move on.

I've been where you are a few times and I know the incredible paralysis that sets in when this decision needs to be made.

You're doing this so that you can do something else (even if you don't yet know what it is) and to be kind to yourself. No-one deserves that sort of punishment.

And, if it helps even a little, know that you can walk away and you can start again. The sun also rises.

For me a startup needs 2 things at minimum: a product users want and a strategic advantage.

I assume you don't have at least one of these. If your users don't WANT what you offer, pivot or shut down. If your offering is commodity, pivot or shut down.

I assume you are depressed because you don't have a plan that offers a way out. Make this your job. Make it your friends job. If you can't figure it out, then your startup is dead, regardless of you admitting it or not.

Not taking action will make you even more depressed. You need progress. Whichever way, move.

The business failed. You did not. The knowledge you just gained can't be taught, and you'll see the signs much earlier next time. Chalk it up as a life lesson and move on. Take a break, give yourself time to really go over everything that happened and let the lessons learned really sink in, and then get back on the horse. Aim for stability (a set schedule, an hourly wage), but don't stay there, only use it as a landing pad when you fall hard in times like this (its easy to become content with mediocrity).

Best of luck to you.

having this sort of income inequality between partners is a big problem. it changes how you look at the business. it seems to me you've already at a point where you have to find a job.

what I recommend is this: discuss the situation with your partner. you need to find investors - it is as simple as this. if you cannot find one, ask for your partner to invest in the company some money if you both still believe in your business model. it doesn't make sense to to forgo your salary when you don't have any money in the bank - what will you eat ? grass ? if you can't raise money or not willing to invest your own it means that your expectation for a viable business is gone. if that is the situation call it quits asap. it doesn't make sense to try to go another few months and lose more resources and acquire debt - find a job and try your hand again in future when you're financially more stable...

> I'm 25, I feel like I'm losing at life already

Don't, I'm 37 and I never had a successful startup, when I was 25 I didn't even know what I want in life. It seems to me people more and more seem to put milestones in their lives "if I don't get to be X by age Y then I have failed"

You are putting yourself to failure. compare yourself to yourself, don't compare yourself to black swans like the Zuckerbergs of this world, they are one in a billion. There are more talented and smart people who are great that didn't create a successful startup than there are people on facebook.

I would say you are in a crisis mode now, and for now your startup is done for, but this doesn't mean that once you get back on your feet financially you can't go back and revisit that idea.

If you post your contact details and tech stack I'm sure you could find some temporary gigs to keep you floating.

I never went into startups because I lacked that financial backbone when I was younger, and had a family later. But I'm happily employed and like my side projects. Going into a startup is a long term game, you are taking lower salaries so you can pay top talent more than you are paid yourself, and you don't want to burn all that seed money (if you are lucky to have any, or using your own savings).

It sounds to me like you need some real remote, US dollar rate work ASAP. If you have been living on a $200 a month, I'm sure that there are people here that would hire you in an hourly rate that would make you earn that in a day or so at last...

I would personally take a break from the startup, use this stage to get some freelance pipeline, get my pockets full of money (or get a remote fulltime job in a startup), save 6 salaries, and only then go back and trying a startup.

Startups have very low success rates, it's all about trying many things, MOST startups fail as you know. this is why you need some savings first.

If you don't have a place to sleep, and food to eat, then you CAN'T RUN A STARTUP

http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs

>It seems to me people more and more seem to put milestones in their lives "if I don't get to be X by age Y then I have failed"

I agree that people tend to focus more on "when" and not "if".

I've always focused on doing something eventually... and then doing it far better than anyone else, especially those who rush into it and end up with something suboptimal. People always ask, "How did you do/get X?" Well, I was patient. Instead of spending effort/resources on tiny incremental changes, I just kept waiting until I could make the big thing happen, and do it right. Sometimes I have to wait 5 - 10 times as long, but I get what/where I want eventually.

I might be interested in funding it. Email me at eibrahim at gmail and tell me more about your startup. Don't worry it will be confidential.

Good luck and don't worry you got a lot of opportunities and a lot of time. 25 is just the beginning.

Sounds like you already know the answer. If you have less than $1 you are broke, you have been broke for a long time. You need money for shelter, food, warmth and security.

Rich people can start companies, companies may run at a loss for years before making good money. I think this is normal.

Re: hard to get money in a poor country - well. They have less money. But it's hard to get money in any country, rich countries have more competition -- see how hard it is to get into Ycombinator.

There are some comments about inheritance tax, but we'll leave those for another day.

Not all places are equal for raising money. Competition has not not suddenly equalized the markets for capital across the whole world. Why's this? Exactly one reason:

1) Physical Proximity - nearly all investors will only consider you if you can pitch them physically in-person. This is the source of the great inefficiency in equal access to capital for everyone in the world. Note: you'll have to physically be there long enough to become friends with the introducers, since most investors don't allow you to approach them directly.

> But it's hard to get money in any country, rich countries have more competition

Absolutely not true. I wish Europeans would stop spreading this myth to each other. Disclaimer: I'm currently living in Europe for the past 3 years, and several other places before this. I hear this myth here constantly.

Some cities are FAR easier to get money in than others. The "more competition" idea that it balances out equally everywhere is complete nonsense.

Some have written about this in far better detail than I will here, but consider:

1) Some cities have the convention of making early stage investments in 1 DAY, after 1 pitch meeting. Not 3 to 6 months and dozens of meetings for every single investor, as is often the convention in EU. Competition for speed between investors is hugely beneficial to the entrepreneur, in this case.

2) Almost no cities in the world, except for a couple, have tons of rich, active angel investors who themselves got rich by starting tech startups.

3) The incredible density of founders and investors within certain places is 1000x greater than the lesser cities. This speed and efficiency of being able to see dozens of investors per week with nearly zero overhead helps enormously. The density of each investor being able to immediately introduce you to several more has an exponential compounding effect.

I found these to be a good intro as to why not all cities are created equally. EU and SV are enormously different in key ways that few outsiders realize:

http://www.paulgraham.com/siliconvalley.html

http://www.paulgraham.com/america.html

It has failed if after 1-2 years you can't see any incremental improvement or growth (although I've seen successful startups who have found their product/market fit after 2 years of trial and error). Don't get fooled by the quick success stories, these are myths or exceptions.

Doing custom dev work to keep the lights on is OK. Many do that. It also gives you time to evaluate your current project and look at it as a bystander, which is hard to do in the everyday grind of startup life.

Oh man, I wish I'd seen this earlier -- everyone's already said it, but you definitely haven't lost at life. Go get a job right away, and you'll be back in the game before you know it.

I was in the same spot at 25 -- worked at a startup for about a year, had a decent number of users but almost no revenue and nowhere near enough growth. I had almost finished a super useful lightweight offshoot product that was going to have way better reach, but suddenly realized one day there was no possible way I was going to be able to pay my rent in another month. I cried a lot; it was a horrible feeling, understanding that something I'd centered my life around -- that I felt defined my identity -- was a failure, and feeling that I was a failure, too. But I got a job, got busy, got better at my craft, and just realized I'd have to do it again when the time was right.

It happened again a little over a year ago -- the company is still there, but us founders were forced out by investor cronyism after years of building. I was more miserable than the first time, and I just drank a lot for months afterwards (in some ways getting severance out of such a deal is worse than having to go get a job right away). Again, it had been my entire life for (this time) almost three years; plus unlike the first time I'd decided it would be ok to borrow some extra money from friends and family, and now that money was gone.

But it always works out once you go get a job, find something else to do with yourself, and realize you can get back to it -- or not -- when you're ready and the time is right.

Based on what you write it's over because you're burnt out and no longer believe it will work out. It will be a tough conversation with your co-founder, because he's in a different situation. My advice: don't make it a discussion, tell him what the situation is. At this point, letting him talk you into continuing (eg. he gives you money) is a bad idea.

My story: I did my 1st startup for almost 4 years. No pay for first 2 years, supported ourselves from other income. Then the startup "took off" in a small way, and we could pay ourself a minimal salary (=about 1/8 of what I now get as an employee of a successful startup, not my own). The last year of the startup, when it was basically failing, was really stressful. I once went 7 days without sleeping, depression, wife left me, got divorced, worst episode of my life. Lesson learned, as they say in the startup world: fail early :) In my case, I could already tell there are problems before the last year, and that's when we should have quit. Next time I'll be wiser. Btw. it's 3 years later and it's all good now, so heads up! Go out and run a marathon.

I think failed vs successful is a false dichotomy. Pretty much any idea could become viable if you dump a ridiculous amount of time and money into it. The best ideas are runaway trains and you have to struggle to keep up with demand. That doesn't seem to be the case with your current idea.

If I were you I would borrow money from family to pay the rent, get a job, save up money, and try again in a couple of years if you still want to.

If you take one thing from my comment then take this - you're 1/2 the age of many people here and have decades of opportunities ahead of you.

If you're 1) unable to raise money, 2) need money to scale and 3) don't have any money then I suggest taking care of your needs first and foremost. There are lots of glamorized stories of people barely scraping by and beating all odds. It doesn't have to be that way and it's healthier if you're wise about the risks you're taking.

I'd like to give more optimistic advice but the truth is that you're young. For many it's an opportune time to do a start-up but you're in a position which makes something that's already difficult even more difficult.

If you truly believe in the your idea and partner then you can take up some consulting work and do the start-up part time.

I also question the working relationship if you and your partner aren't feeling the same level of stress. It's critical that either you're both in the trenches or neither of you are.

> I'm 25, I feel like I'm losing at life already. It was okay to be broke earlier, because it's expected. It's not anymore, when almost none of your peers are.

I would _strongly_ recommend disregarding third-party success metrics.

You're carving your own path. Keep learning. Keep playing. Money will eventually come.

I have been bankrupted once. $ < 1, people coming home to claiming money, the shame of going back living to my parents at 36.

It was hard.

I was my boss, I did stuff right. I just did not expected customers to lie about the idea of paying me.

I lived in a corrupted country where there was «legal way» of claiming back your money, but only if the company did not bankrupted, and justice was given by «peer» justice where my customers were the «judges».

This country is called France, the «arbitration» system is inherited from middle age and has never been reformed.

After personnal bankrupcy you are just down. You can rebound if you have family support, and you will need it.

I left my country. I am now a stranger in a stranger land with all the side effect it has (I am being paid less than the authorized minimum for stranger, preventing me from asking permanent residency). I still have no money, 5 years later I am still vulnerable and fearing the final blow that will definitly take me down. But, I am also resolved, pissed of, and people call me a troll.

It won't kill you, it won't make you better or stronger.

You might have insomnia, and trust issues, and maybe some doubt about justice.

However you will discover that having rich parents is the real way to get rich. And that poor people are always sided from society.

Of course I was blamed for everything that happened to me by all kind of «nice persons».

I am stil alive and kicking and resolved. But it was, and it is still hard. And if I am a troll, it might be because I feel I am less of a troll than the society we are living in.

I have no regrets or remorses. But I don't believe in the BullShits about being smart and a hard worker for succeeding in business.

You have all my support dear superpi.

Surprisingly it won't kill you, and you are young. You still have a life to live, and you may discover it is wonderful.

Actually, I am happily married even if fleas and bedbugs are preventing me from sleeping in my north american flat, even if I am broke, I enjoy life with my scratches from all the bugs bites...

If you can find a job in a government administration: get it in order to rebuild your savings and stabilize your situation.

PS: there are a lot of «nice persons» on HN. Your only crime is you were born poor, that is the reason of your failure.

If the startup has lost any traction, and you've tried and failed to pivot, and see no other opportunities to make this work for some time... it's probably best to change tracks, get employed or do another startup, and return to the old startup in you mind every now and then to see if it's become viable with new insights, a changing market etc.

But as an outsider with limited info, it seems it's 'failed'. I wouldn't attach that word to it myself but you asked. If you're not pursuing the business model, and just doing client-work, you essentially stopped running the startup already.

Tech is a tricky field because its history has a number of 'big stories' of 'close to failure, but we had grit, and we succeeded'. The likes of FedEx, who had $5k to pay a $24k fuel bill, the owner went to Las Vegas and gambled the last 5k, miraculously won enough to pay the bills and continue on to create what is now a billion dollar company. But for every 1 of those stories, there are a 1000 who tried and failed anyway, with great consequences (debt, depression, negligence of friends & family etc).

So I definitely, personally, wouldn't keep trying 'no matter what'. Grit and perseverance is hugely important, but investing it in a dead idea is not. If you truly see potential and opportunity in your startup idea, the market etc, then you may want to keep trying. But if that were true, you probably would have had some traction, and less doubt. Seems like you should try something else.

Good luck whatever you end up doing.

As for 'losing at life', I don't feel like explaining but, it's just not true. Don't worry about it, really. I do know what you're feeling but you're not losing at life.

At most you could say that you're playing a game you don't want to play. Startup life carries with it the possibility to live on a few hundred bucks a month, while your friends have junior positions and talk about their next promotion. That's not for everyone. But you're not 'losing at life' buddy :)

> When do you know your startup has failed?

That's a good question, maybe not the right one. I'd rephrase it as "When should you decide to stop working on your startup project?".

You should decide when to stop pushing the startup, when you realistically see no path to revenue, and your savings get low. Try to take this decision early enough.

As you write you don't have any cash anymore and can't pay your rent anymore, it's probably urgent that you seek revenue asap.

> I'm currently going through a mini depression

Don't worry, it's normal, you know, entrepreneurship is an emotional rollercoaster. We all go through this. Let's try to focus on what can and should be done at this stage.

What have you learned from the startup experience? You can probably make a big list of things to do, and things not to do.

Let's forget about your startup idea, product/service for a minute. What skills do you have, how can you help people with them? In your network, are there people to whom you could benefit from your help, either as a freelancer or as an employee?

I've been in your feet recently. After much hesitation, I've decided to kill my startup last January, after working on it for 2.5+ years. Taking this decision has been difficult, uncomfortable. However, after taking it, I was much relieved, and had this sweet feeling of freedom.

Fast-forward four Months, I have now lots of revenue from consulting on interesting projects, and lots of people keep trying to recruit me. I didn't need to make much effort to launch this, just create an attractive offer, where my skills can solve a common problem. It's very surprising to me that this is happening so easily, after facing so much difficulties to sell a product at my startup previously.

> I'm not in a developed country

This probably doesnt' matter. People do business, you can find clients anywhere. Just decide to leave the startup now, and move on fast. Good luck :)

The advice I would give would be to take the opposite approach and not to look at it as failed, but as not having become successful yet.

Don't give up a job and take a punt on something, do a job and work even harder on the side to build a start up. Quit your job when you are in a safe place. Don't fall for all the news about amazing start ups funded by VCs, in my opinion this is a stupid way to go about starting up your business because you are taking an enormous risk with other people's money. Do it safe and you just can not fail. Its harder but it works.

If your startup never reached success then its not failing, it just never succeeded... work towards making a successful start up instead of feeling bad that you failed.

Hey, I was in the same position — personal debt, $0.07 on a card and a rent coming up.

Do you take contract work now? I have a quick market research project with 15-30$/hour rate. Ping me at yury@entangled.ventures if you are interested.

Generally speaking when you have to decide between rent and hosting costs you're past done.

Luckily you have skills! Go work for "The Man" in whatever capacity that is for you; spend a year or two shoring up your finances. Think about some new ideas. Think about what you have learned and what you will do differently (maybe even better) next time. This isn't a one-shot game, you can come back and play over and over again.

I didn't reach the point you did until I was 32 - you're already tasting it at 25. So I consider you ahead of me in the game . . . please don't feel like a failure.

Read this comment: https://news.ycombinator.com/item?id=1447467

One of the points stands out and may apply here:

> Stick with it- Don't give up too fast. Being broke and not making any money sucks + can often make you think nothing will ever work. Don't quit when you're down. If this was easy then everyone would be a millionaire and being a millionaire wouldn't be anything special. Certainly learn from your mistakes + pivot, but don't quit just because it didn't work right away.

I'm 45 this year and last year I did my first startup as a salaried employee. It failed when pretty much the number of customers we had when I started was the same when the plug was pulled.

However I've just gone back to consulting for 6 months to build a nest egg to begin my own start up in the summer.

BUT I know I can dip into consulting should it get tight. You seem to have got into the startup but forgotten how to keep yourself alive.

Being an observer, I would suggest you get yourself a consulting job pretty sharpish, let your partner continue full time and you contribute as you can in your evenings and weekends.

Can you give any tips on how to find consulting fast enough when you are about to be evicted?

Basically be immediately available for contract work and prepared to work anywhere. Setting up a company in the UK takes about an hour and a company bank account usually 1-2weeks. There are also umbrella companies. What I have found is that agencies will 'lend' against money. They want to keep you happy. So if you are in a situation they will help you out as you are making them money.

I took a big chance on something that failed. Simply put, don't avoid the warning signs that it is failing, even if others feel that it isn't. Here are a few personal examples:

1. You believe that your company will get paying customers (or investors), after 'this thing' or 'that thing 'happens. You feel like you are holding out too much for these things to happen.

2. Your partners seem to act oblivious to the failings of the business model and tend to cling to it. They fail to understand that admitting defeat sooner than later is more important that an idealistic goal and business plan. This failing would be coupled with a dedication that "we need to hold on and keep going if we want to make this happen."

3. Your partner/s do not recognize the importance of their own or your personal welfare, because the goal of the startup is more important. This can be true despite not making any strong sales or establishing investor relationships in the time span of at least six months or more. (I personally say 'six months' because you have personal finances to attend to. Frankly, six months with absolutely nothing is a sign in itself, in my personal opinion.)

4. You feel guilty for giving up. You are also guilted into not giving up.

Stop believing you lost your life. At this time, you need to fail fast. Realize that sinking yourself more into risk will create more problems down the line. Leave now. Take your skills and maybe get a job somewhere else and build up your wealth again. I was almost broke myself, with my wife, in another country (which I still am in now.) I failed fast; got my resume out there and a month later, had the movers come to move where I got the job. It was fun, it was sad, but it was a life lesson to be more attentive to this stuff in the future.

As a side thought, there might be a lot of glamour around startups these days, but business is still business. If you are going broke, your DOA-startup is nothing to glamourize.

I wish the best for you.

EDIT: Just as a follow up to this ... I went from the startup to one of the most interesting jobs I have had, given the new programming challenges to work with. Life can lead you down interesting paths. :)

With respect to #1 and #2, I've been skeptical of startups that seem to having such problems and twice I've turned out to be wrong.

That not to say that it's always like that, but a little optimism goes a long way.

Certainly, though, if you feel like shit, you shouldn't continue. Startups aren't everything if other parts of your life are suffering.

I agree with you. I think part of the risk is suspending what you think is right and accept what is in front of you and the possibility that it will work.

It was really the sinking realization that this is truly not going to happen that led me to personally pivot. As of today, it is still not happening. ;)

While there are objective indicators in terms of product:market fit, your startup has only failed when you let it fail. Most successful entrepreneurs I know that have had an exit generally were on the 2^nth permutation of the initial set of product features. You keep bashing your head against the wall until you can no longer take it. It is not a glamorous road, and founder depression is very real. Just take solace in the fact that everyone - even the really successful teams - have been where you are. Find a way to take care of yourself and if you are meant to be an entrepreneur, the idea or set of ideas to get you there will eventually find its way into the back of your brain.

Finally - ideas are nothing. Ideas are next to worthless. There are tens of thousands of proven business models you could go build right now if you wanted to. What matters most - whether at your corporate job or your startup - is execution. Make that first dollar, and claw tooth and nail for the second, and the 100th, and the 1000th. One step at a time. No one is 'killing it' and every startup is a hot mess of ego, spaghetti code, and future employment lawsuits.

Just take a breath and don't lose your spark of insanity that impassioned you to build something to solve a problem in the first place.

This is honestly a great question, but much more the answers that the community have given.

I read almost all the comments (took me like 1 hour). I've been working on a startup for 3 years, learning from the failures and success, I've read couple of books, talk to a lot of people about startups, etc, however something that always will surprise me is that the community is the one that really has the knowledge and savvy.

Happy to be part of this community!

As someone who has a failed startup under their belt, you know it's failed when you don't want up with a 100% chance of optimism that it's going to work out.

My strong suggestion, when/if you reach that stage (and it sounds like you're there), just let everyone know you need to move on.

It will be OK, I promise. Your investors will be OK. They invested knowing they might lose their investment. Your co-founder will be OK. He may be frustrated with you for X number of months or even years, but that's OK.

You tried your best, and it didn't work out, but that's OK. You're only 25, you basically paid yourself to learn a ton of about a ton in a short compressed time period. \

Eventually you'll learn to be impressed with how much you did in this timeframe.

Once you leave, give yourself time to heal and reflect.

These are the experiences that teach us and help us grow, but you'll need time away to see that clearly.

Good luck! Keep the good fight going and know there's a community of us who had something not work out, but were able to rebound and make the next one work... or the next one.. or the next one.. :)

At 34, I started my entire life over. I got a divorce, lost most of my savings in the divorce, was 30 lbs overweight, and hated my job.

25 is nothing. Within a few years I was remarried, had s lot of money in the bank, now I'm in my 40s, have a kid, house in the Bay Area, and a great job.

If I can restart my life at age 34, you can move onto your next chapter at 25 and keep doing it until you are well into your 30s.

Hey man, I'm around your age and I can really relate to what you're going through. I'm glad you posted here and I hope you've read the other great comments in the thread. There's a lot of good advice here.

One of the hardest tasks to do in life is to kill a dream, but don't forget that you have the power to create NEW dreams for yourself and pursue those. This dream may be over, but you are free to pursue anything now!

Right now it sounds like you need to hit the 'pause' button on this startup and look after your most immediate needs - a hungry, homeless developer is going to have a much harder time building anything than a developer with enough money to eat.

If building startups is your passion - try your best to get yourself in a position (like your partner) where you aren't reliant on your startup for your rent and food - then having a startup fail won't bring you down with it.

Best of luck to you from this point forward - the only place you can go is up from here :) Wishing you all the best!

I was/am in a very similar situation.

My suggestion to you is to take a break, analyze and record what went wrong, and led someone else take the lead for a while (find a position elsewhere).

When you're ready, start another company and don't make the same mistakes twice.

It's okay to fail - the majority of us do. However, if you keep trying you'll get better and limit your risk of failure.

Hey, Talking about poverty. You're poor if you don't have to decide if you wanna eat or smoke, coz you wanna eat. Is it a reason to get a job? Sometimes it is. Sometimes it is not. Once I've started a startup and it took off in 6 months. Money, girls. Next time I had to go to construction industry. And it was so much fun, I've spent 10 years in it. Pivot every day. Now, once again, we have a startup. Feels fresh and alive. Will it be successful? Of course it will. That is if my customers will pay me next month and I won't go broke. You got the idea? Start up life is in a sense a curse. It is a never ending story. To live it you gotta be a phoenix. And it is not a choice. It is a fate. Not necessarily a lucky one. But if you are an outlier, the strange guy, you gotta go on, an live your life. Go to construction if you have to. Or outsource. There is magic everywhere, if you can see it. Just try to see it, and make our life better.

Timely and poignant question for me, as I am currently dissolving my first startup. I actually called it quits a year ago and took a job with another startup, but kept my company alive 'just in case'. Well, the new job is going well and I haven't touched my project in over a year, so rather than cling to the past I decided to let it go officially. That would be my suggestion to anyone in this position.

There is a bright side, though, at least for me. Doing my startup (which lasted about a year) provided invaluable lessons in many topics, and ultimately made me more attractive to other companies. In the end I gained a ton of knowledge and connections and have mostly recouped the lost savings at a higher paying job than I had before. I acknowledge that this is attributable to good luck, but I would argue that anyone who has tried a startup, even just once, has a professional advantage that could potentially pay back the investment.

You need to read http://mystartuphas30daystolive.tumblr.com and realize you're not alone.

First you'll survive, then you'll thrive. This experience will build character in you like few other experiences can.

Reach out to me if you need anything.

Take some time to think about solutions, and your vision. If you go through all of the possibilities and you cannot figure out a game plan to get you to your goal, then it is time to change. And if you are spending all your efforts on keeping the doors open and have no time for your vision, then your startup is not working. It's okay to take a side job or pay for hire as long as you have time to work your plan. And it is okay to take a break, rebuild your resources, and then pick up your great idea later. This iteration of your project may be over, but if you still believe in your ideas, then they can still succeed. Failure is when you stop trying. Or, maybe better, failure is when you stop moving forward. You can learn from each iteration and make the next better whether you call the previous iteration a failure or not.

> So, if you've had a failed startup, how did you know? Did you run out of money and call it quits?

Yes, that's exactly it. Even better when you know it when you determine that X months before you actually run out of money

Close shop and get a job. This is not the end of the world, so don't sweat it.

My first two businesses failed and I've probably lost a total of about 4 years worth of income had I spent it working somewhere else not to mention the money I dumped into the businesses. I was depressed after the first failure, and destitute without hope after the second.

But you know what, I learned invaluable things from those two failures and I would never have gained the experience I needed to have my 3rd business succeed without those failures, because I learned what not to do and where to best expand energy and money.

So I went back to work for about a year, and then another opportunity came my way and I took it. I wouldn't have been able to without the first two failures, because I simply didn't have the experience necessary.

You didn't even explain what your company is about, we don't have enough information to asses if you should keep going or not, therefore it's clear you are not seeking for advice on startups but just for support on an emotional and personal issue. I'm from a third country also, so I completely understand your troubles. 2 advices: to be successful, you need to try at least with 3 o 4 different projects, it's very rare to be successful straight away. 2nd, the rules of the game in 3rd world countries (I'm talking LatAm here) are WAY different than what you read in Techcrunch and the like, so don't compare yourself to what you read here. Good luck.

What I have done is to pick milestones that must be met in order for me to continue. I too share your emotional frustrations and depression. For example, my family recently fell apart.

So, figure out what would need to happen in order for your business to become sustainable. Break that into small milestones. Inform your partner what advancements must be made in order for you to continue.

Potential milestone examples:

* 10 paying users within one month. * 1 full time salary supported by paying users by month 3 * A couch to sleep on by yesterday.

You are young, you are ambitious, you are intelligent. Give it one more final rally and if it fails move on to something more stable for a couple of years. Then re-evaluate.

It's always darkest before the dawn. 6 months is not enough time to know. You will probably feel like this several more times on your journey. Welcome to startups.

Since you are broke my suggestion would be to focus on one thing: go find a customer who will pay to use what you built. Delight that customer and then go find others.

You could start consulting (sell websites or seo or something else related to what you do, that virtually everyone needs). That can give you some cash if you aren't yet ready to find a customer. But seriously, 6 months is not long enough. Plan on a decade, and in the mean time just focus on your next right step. Get to $1000/month.

Make sure you're watching out for yourself. If you feel like your needs aren't being met then you need to sit down and speak with your partner. It may be working for him, but it doesn't seem like it's working for you.

A person can fail, or an idea can fail, or a team can fail but then you iterate to the next one. A startup altogether can only fail if you as the founder decide it has failed, or you as a founder decide startup life isn't for you.

Sounds like it's time to move on. Keep in mind that you (as in you, the person) matters a lot more than your (or any) startup. Don't ever equate a failed business with a failed life. There are many successful founders that hadn't even thought about starting a company at your age and you'll probably get many more shots at this over the course of the next few decades.

It does sound like you've reached a point where the best course of action is to call it quits and start something new - contrary to popular opinion, startup companies are just _one_ instance of the many things you can do with your life.

As a word of encouragement, try and see it as a positive thing. After all, Paul Graham says that we can learn a lot more from failure then we ever could from success.

Second to that, you have one of the most valuable assets in the world in your favour. Time. It is the one asset that no amount of money in the world can buy back. Be glad that if you fail, you've failed at the age of 25, as opposed to when you are in your mid 30's, with children and a family to look after.

If you still can't see the positives. Lets put it this way, if you're starting at the bottom ($1), at least acknowledge that the only way is up. :)

What does your startup do? Maybe someone here could be interested in funding it.

Without knowing your situation in detail, and only reading half the replies. What I didn't hear was this.

Is there something in the world that is about to change that your startup can take advantage of?

In less then 60 days, in the U.S.A., the Securities and Exchange Commission (SEC) will allow startups to advertise and accept money from non-accredited investors. That is, regular folks who aren't rich. Maybe you could partner with someone in the U.S. and if your ideas, etc. are worthy you could take advantage of the relaxed equity crowdfunding rules to raise money.

1. You have not failed in life 2. The tone of the post seems like you have emotionally accepted that your current endeavor has failed and you are looking for external validation - but lets keep that aside for a moment -- Are you getting pull from customers about what you are building ? Is it growing at say >10% monthly rate? If not and your energy is running out .. Take a deep breath be pragmatic and think where do you want to leave an impact

It could be in the current area or another one and it is for you to decide. Hope this helps

Anyone who has ever changed the world has been in your shoes, and it's because they were in your shoes that they were able to change the world.

Just remember that, and you will forever be fine, my friend.

There are few questions to ask yourself:

1. Has your partner given up? If he has walk way.

2. Is your partner invested? He's the chicken and you're the pig in this restaurant. If he's not giving it his all you need to walk.

3. Do you have a business model that works and just not enough customers or no customers. If you've been at this this long with out customers it's time to bail.

4. Can you do this anymore regardless? You sound like you've run out of steam, might be time to find something else for a while. You can start another company later.

> So, if you've had a failed startup, how did you know?

When I was getting serious about it, rather than just hacking in my free time, I made the decision as to how I would know I'd lost before I started the company. I said I'd pay myself as an employee, and that as an employee if the company couldn't/wasn't going to be able to pay my wages, or if my savings went as low as £25,000, that was it - I wouldn't work for my company any more.

I knew it had finished because I shot it in the head and called it finished.

> Did you run out of money and call it quits?

Sort of, I ran out of the money I was prepared to lose in the gamble.

It's easy to hang on to hope, comforted by the image of the gambler coming in for the big win after sticking to their guns. But, if you're going to do that, you'd best have a really good reason (not faith in the product or hard work or anything nebulous like that, something you can plug into Kelly Criterion) or it's no smarter than all those people losing money in Vegas. Of course, if you'd only ever spoken to the people who'd won big in Vegas, then you would think that was a smart thing to do.

What you're buying with money is time. More throws of the dice. Well, chances are if you didn't make it in the first £500,000, or £1,000,000 or whatever your initial kitty is, the time that some piddling amount (compared to the budget of a company) buys you isn't going to make an appreciable difference.

> I'm 25, I feel like I'm losing at life already. It was okay to be broke earlier, because it's expected. It's not anymore, when almost none of your peers are. Also, I'm not in a developed country, where being broke means living on ~$1k a month. I've been living on ~$200 a month.

Gamblers lose from time to time, it happens. But the nice dis-analogy with gambling is that in life, as long as you're breathing and not in jail or something like that, there's a chance to make something of yourself. You shouldn't spend those chances on foolish things, but they're there.

A start-up is not your life. Five years down the line you could be just as rich as the age-adjusted median wealth for your category would suggest.

I ran a business (before it was called a startup:) for way too many years ungil I finally (depressed and broken down) sold it for a "penny" just to get out of it.

These days I am building a new product (again), calling myself a self funded startup.

The difference is that these days I look forward to mondays.

Back in the old days i dreaded mondays.

If you would rather procrastinate or get drunk than work, it might be a good time to leave and call it dead!

PS. Those i sold the business to got quite successfull after I left, so it was probably for the better!

When I ran a start up, I did it because I had other sources of income. There were even times I took on a second job just so I could fund my own start up. If you haven't had a salary for the last 4 months maybe it's time to consider getting a job. This is no longer a start up, it's a hobby. If you still believe in it, don't quit. Otherwise sell your share to your rich partner who apparently isn't phased by this at all.

Hi @Superpi, in regards with your situation, please read this article, this might inspire you... http://www.inc.com/ben-baldwin-and-donald-cowper/this-entrep...

But for now take a break first, put your startup aside. If you need to work to earn a living then work. Don't mind what people might say if you put your startup on hold. Who cares about them? Do you think they care about you or your startup? No. They probably would talk behind your back for awhile. But who cares. What is important now is for you to live your life the way you wanted to. Life won't be back in an instant. But whatever you learn from your startup keep it and use it when you want to do it again.

I wish you well and be strong.

----------

With regards to the fact that it is hard to raise money in a poor country:

I agree. It is harder to raise money in a poor country. It is also sad to realize that unlike the Western countries where angel investors or incubators/accelerator are willing to shell out money just to test if there is a market for the idea even if they have no product at all. In a poor country, even if you have a prototype ready and you need funding to test it to the market, your prototype is nothing and you will be valued way way less than what you really are. Until you can actually prove that it is a viable business or maybe you have actual customers, then that's the only time they are willing to risk it. In a poor country, nobody feels safe to invest on you. It's all about risk management.

It is also sad to see that investors (from other countries), doesn't believe that the next billion dollar company can come from a third world country or maybe from a third world country founder.

But as a startup founder and as an individual, those "facts-for-now" doesn't stop me from building things, nor does it stop me from innovating, or stop me from building my startups, and that doesn't stop me from believing that I can build the next billion dollar startup. I know I have to step up my game and give 2-10x more the effort provided by the privilege people, but that won't stop me from fighting and believing. Because remember nothing is impossible and if you want it you will do it, no excuses.

Failure is the normal state of things. You should aim to be comfortable with failure. If you don't enjoy the process, then you probably shouldn't be doing it.

Most people don't succeed financially. You could make all the right moves and still not get there. It's something you have to accept. There is a lot of luck involved - Especially the first time.

I have ran startup for around two years and It was failed. Below are reason to shown us as a failed startup 1. Market size was very less as we were expecting(we came to know about this later) 2. Investment was too high compare to ROI. And that too need to wait for couple of years to start revenue. 3. Scale was very difficult.

First of all: you can absolutely fail your first startup and then have success at the second, or third, or whatever one - or have success without a startup :)

So, whatever happens, recognize that if even if your startup fails, you're not "losing at life". Life goes on, and you'll have much more experience than before.

If you are doing some work for hire, you can continue doing it after leaving behind your failing company and presumably your partner: you already have a job, just embrace it. Even if you don't have paying clients right now, you have some good contacts who can give you some work or a stable job in the near future.

You have to wear a pretty hard outer shell to get through the lows. If you have a good skill set, have you considered just getting a full time job and trying to bootstrap the startup on off work hours? The skills and risks you have taken with your startup can be an asset on your resume.

How much are you trying to raise? What are the obstacles? If you suddenly had $5k in the bank to keep going, would you be able to hit cashflow? email me if you'd like more help, brian at refreshmiami .com happy to give feedback, just need to know about the business itself

You know it's over when there's no way to continue. As the rest of the comments here, I think the first thing to do is find a way to sustain you before sustaining your startup. Find a job that pay you and get out of your mind the risks to be kicked out of home !

I and my co-founder are almost in the same situation right now (except that we don’t have rent). I think it's more about you and if you have the power to keep going but yes you should have customers and built something or part of it.

"All companies die the same way...They run out of money." - Bill Campbell

i want to tell you my story. i started my first startup at 20 my first product totally failed, i lost more than i have in my life, at the fail time i started new product it's about clustering news system for some president election i sell it and get more than 200K after that i was happy really happy i met someone(girl) and i lose my mind and focused on her and finally i lost my money again obviously and the girl leave me now im 24 with no money but i started again with a lot of experience, btw be strong, f... negative thing, you already have great experience (sorry about my language)

8 out of 10 startups fail. This should be encouraging rather than discouraging.

Hi, superpi. I think it is lucky that you are just 25 and you experiense this. In my opinion, maybe a developing country has much chance and less competition, and you just need to earn $200 a month to live.

Its done when you don't feel like doing it anymore. Not "don't feel like doing it today", but more like "don't feel like ever doing it again."

Give yourself permission to stop.

Off topic: I think starting a company with another person where they are economically at a different level is a bad idea - economic alignment can be a factor in start up failure.

I like the Paul Graham notion that indicates a startup has failed. Once you refuse a phone call from PG or he doesn't hear back from you the startups finished.

This assumes that PG is calling you- not exactly a generalized model.

I think the sentiment from PG is that when the line goes dead, it just shows the founder has given up. It is an important flag for any mentor/investor to see that the founders have lost their commitment, but it doesn't say much about the health of the business itself.

This notion from PG doesn't consider the case when the founders are beating a dead horse (not making sales, refusing to pivot, etc.) yet they are adamant about continuing work as usual. This situation is more likely to occur when the company lacks a good support network, or merely lacks the ability to hear advice.

What is your start up? If you can live off of 200 a month and be fine, there might be someone who believes in your idea and will send you 200/month.

When you've decided it's failed.

Many successful people say: "Never give up. Be persistent. That's the key to being successful."

Edison would agree with them.

hang in there my friend. may the force be with you

You are not a failure. You are not a success. Where you are is about the world around you, who you are is not. Who you are is about your character, your person, your choices, and your integrity. The only way the outer world changes your inner person is when you allow it. Its ability to change you stops the minute you decide to stop helping it to do so. Nobody is broken, some people quit.

It is good that you feel like a worthless failure. You are likely too young and ignorant to realize how valuable this is.

Great results come from great decisions and great work. Great decisions and great work come from the mind and will, and are learned by experience. Experience comes from making decisions and actions and learning from them. If you have nothing, then you have learned something. If you have learned something then you have nothing.

You can choose to think through where you are and what you are doing and learn the most, to understand the most, to get fuel for the engine of your willpower, or you can let it pass by like an invisible and silent locomotive an inch away from your face. What happens now is the consequences of your actions now. Your actions now are the consequence of your choices. You are not a product of your past. You are not the squeezings of your circumstances.

If you want to be successful in business, then understand what value is, and return it to the customer. If you always return more value to the customer than they lose through the sales price, then you will always have customers.

The world, though it looks like it is solid and complete, is like a sponge, like enormous swiss cheese - it is dense with holes. Each hole is a place where value can be returned. Find one. Fill it.

Money isn't the goal. It isn't the goal of capitalists or plutocrats. It is paper - it burns. It has no fundamental value. All the engines of industry and finance in the world are an expression of human failure to handle value healthily in the context of community. Unlike you they are not broken - so they can never learn and never change what they are doing. They are too poor to have that wisdom.

Never blindly walk down the road. Take good wisdom based on good vision, and walk down that road. If you are going to make a startup - 90% fail in the first year. Go into it knowing that it will fail. The second startup success rate is better than 50%. The third startup is upwards of 80%. Find the best value you can create and create it for people. Even if you fail once or twice, you fail doing something noble, something worth having done it. Even in "failure", in "defeat" in having done something great you get not only the learning, but the having done something worth doing. The defeat gives you two of the most meaningful measures of victory.

Read wisdom. Epictetus. Marcus Aurelius. How to live on 24 hours a day. Make a log of your time and be brutally honest. Know your budget of time - where it goes. Truth allows you to allocate it in improved ways. Watch Randy Pausch - the last lecture. Live life well. You only get a few days till it is done, and in death every victory that can be taken away is. The ones you keep in your heart and soul - those are not taken away because that part of the person is immortal.

Try until you can't try any more. Then try some more. If that doesn't work, you have to do something else.

You are free to fail all you want at 25.

I'm just curious where you're managing to live with ~$200/mo.

What is the name of your startup and where are you based?

I wouldn't want to write that here, because I wouldn't want my partner to find out through HN. If you leave your email, I'll definitely get back to you

Ok no problem I understand. I'm simonswords@gmail.com.

I am also curious. I have my email in my profile if you have a moment.

losing life. losing life is when someone is being blown up or kidnepped or shot down. so if you are still alive, keep the pressure. live.

What sort of product does your business sell?

if I may: are you a Pole?

Yeah I was wondering that, too. But $200 seems a bit on the low side for Poland for someone doing work for hire in tech. Also him/her saying it's 'not a developed country' wouldn't make me thing of Poland, it's a developed country by most standards (e.g. IMF, HDI etc), though struggling in rural areas and opinion differs.

just out of curiosity, are you indian by any chance?

Hi, I'm actually not Indian. I'm African, and I know Africa isn't a country, I just don't want to run the risk of my partner finding out through HN

Which country are you in? That is also a factor

Hi Superpi :-)

First of all I want to congratulate you and your partner for taking the huge step of starting a business - something that very few people will ever attempt (although many will think about attempting). In my opinion it's a great thing to take hold of your destiny in that way but it's a very difficult thing to get right and for every success story there are dozens or hundreds of "failures" - I use quote marks because that word gets a bad press generally; many people seem to forget that they "failed" at many things in their life on the way to learning how to succeed at them. If you're not failing then you're not learning and life would be much less interesting that way (although of course much easier).

About ten years ago I went self-employed (you wouldn't call it a start-up as such, I was just a freelance software developer), and for me, the point where I had obviously "failed" was when a) I was deeply in debt and could no longer afford to sustain my personal basic requirements, that is, a place to live, food to eat, a car to get around in, and b) there was no prospect of improvement in the business. I think if you're on the point of losing your house but the business is looking very promising then it's probably worth the risk - spending your last dollar to win the $1million contract, as it were - but if the business looks like it has no future then why make sacrifices to keep it going? Perhaps the reason is...

>I'm 25, I feel like I'm losing at life already. It was okay to be broke earlier, because it's expected. It's not anymore, when almost none of your peers are.

You're not losing at life, you're learning about life, and instead of making safe choices that suit everyone else, you're making difficult choices that suit you. Bravo! Sometimes those choices don't work out well but that's life, unfortunately; if you don't take risks, you won't get rewards - if you do take risks, sometimes you still won't get rewards, but other times you will, and those rewards may be far greater than you would get from an easy life. Try not to worry about your peers - they are living the life that suits them, you are living the life that suits you.

So I would say: make an honest assessment of the future of the business. If it still has good potential, then suffering hardship now could lead to great reward later. If you're keeping it alive because you don't want to feel like a failure, then recognise that, as I said, "failure" is really just learning, and don't be ashamed to make mistakes along the way. In that case, get a paid job for a while, take a break and recharge your batteries. Then you can start your next great adventure when you're ready :-)

Best of luck to you!

when you run out of money.

It's easier to tell "time to leave" from "the whole thing has failed". It really sounds like the first is true for you. The second? Quite likely, because a lot of startups fail, but the definitive "it is over" moment might come loooooong after (like, 5+ years after) the point where you, personally, should leave. Your rich co-founder can keep it afloat-enough to say he has a job for years, but this does nothing for you.

My partner is fine actually, he has rich parents and doesn't really depend on the startup for income.

Sadly, this also means that he outranks you. It couldn't be an equal partnership even if he wanted it that way. He has the connections to find clients and funding (although it sounds like the latter is out of the question) and you don't, which means he'll call the shots.

If you're going without salary and not the boss, it's time to leave. Time to leave was a lot time ago, in fact.

I'm 25, I feel like I'm losing at life already.

You're not. 25 is not old. You're losing money and opportunity every time you work at a dead-end startup, but that's not the same thing as "losing at life". Just make the best decision you can at this point. You don't have to justify your past or yourself. You tried something and it didn't work out; that happens to the best of us.

it's over when you quit. plenty of people work on their startups/business without a salary, sometimes for years. it's fucking tough, it's no easy street.

Get your shit together and then reassess, you need a roof over your head first if you wanna keep at it.

good luck.

fail fast and do it public. don't keep dragging the failure in hopes of a miracle

when i stopped believe that i can make it myself.

Wake the fuck up, there's so much more about life than startups.

When your product name is Meerkat

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