It assumes if idea #1 doesn't work out quitting is the best way to go. The reality is once you have even a small team of co-founders or a slightly larger one together you have a group of people who have _hopefully_ learned to work with each other well and can move unencumbered to explore and test a variety of ideas, develop insights and ultimately increase their odds of success. Sure, it's not guaranteed to work, but it's probably better than the next best alternative.
And oh, good luck just shutting down and re-rolling into a new company with investors and employees.