Should I Return Our Investment Money?

  • Our company is dead.
  • The team has been disbanded and have received placement/salary elsewhere.
  • I’ve devoted the past few years of my life to this organization (both mentally, physically, and financially).
  • I feel cheated by the team, abandoned, and am now faced with officially closing the company down with no help from team members.
  • I am near broke without a salaried job.
  • We still have a significant amount of money in the bank.

Should I milk the remaining funds or return them to investors ?


  • It’s completely fine to pay yourself some money so you don’t go broke. The company has already failed, that’s a done deal. There’s no need to ritually sacrifice yourself. It kinda sounds like you feel you have a responsibility to go down with the ship. You absolutely don’t.

    Whether you can keep the money depends on what you consider “significant”. 10-100k? Keeping it is probably fine (check the contract, though!). If it’s more then the investors are probably expecting to get most of it back. If you don’t mind burning bridges you can just try to keep all the money, see if the investors care enough to force you to pay them back.

    The best angels and VCs don’t sweat the small stuff anyway. They’re looking for a 10,000x homerun, and a failed startup is just something they shrug off. So perhaps your investors aren’t expecting to get a penny back, in which case doing the “honorable thing” would be a big mistake.

  • You say you are broke. Meaning you don’t make any salary? That’s odd considering that you have investors. Like the previous commenter you definitely need to at least pay yourself to wind down the company. Something “market rate”. What choice do the investors have? Shut it down themselves?

  • Should I milk the remaining funds or return them to investors ?

    Seriously? You say it’s a significant amount…..why not pivot and use the last bullet in the chamber. Lay everyone off but the founders…come up with a new idea….and don’t pay any salaries until you decide your new direction.

    Look up Danielle Morrill with Mattermark. It used to be Referly – that’s what you do.

    If you truly are quitting – yes don’t spend another dime of your investors money and return it!! It’s not your money – it’s theirs! Use it to grow the company or shut it down and give back what’s left.

    • It’s not their money. The money belongs to the business. The investors exchanged money for equity, and they keep the equity in the (now worthless) business.

      • OK two things.

        To the original commenter:

        This guy is BROKE, and you want him to not pay salaries? Are you effin kidding me? He NEEDS to take a damn salary, a sustaining one at least.

        To the commenter who says the money belongs to the business:

        Yes it does, it doesn’t belong to the founder to milk it. The founder is a director and a director’s job is to protect the shareholders. If he milks it for himself its called unjust enrichment and he CAN be sued. It just depends on whether the amount is worth suing over.

        That all said, a pivot is definitely a good idea, just pay yourself a damn salary, its a win-win for you. The investors get another roll of the dice, you make some money finally.

      • “The money belongs to the business.”

        To the business. Not to the guy personally to put all investors (!) money into his private pocket.

        Like said before by someone else, it could be considered fraud. In my country it’s actually fraud. You are defrauding your shareholders/debtors of the money they legally get by law when the company closes.

        When a company closes, the shareholders get the remaining assets split; if you know you are closing next week and you take out all money/assets you are a thief and should go to jail.

  • 1] Take a break, completely switch off. For a week , 2 weeks if possible. Go to some other country dont carry your phone. Its hard but do it. Clear your head first.

    Make sure you let team/investors know you are taking a break.

    2] Hopefully you will have better idea and have found atleast 1 good cofounder. If you have a different idea, launch a cheap MVP after coming back.

    3] If the MVP works tell your investors about the new idea and get them on board that you will downsize and pivot to this new idea.

    If the MVP doesnt work, be transparent to your investors. Tell them you are broke and they can find you some good job (You learn a lot doing a startup, trust me you are valuable then you think) . Dont burn bridges. Be Transparent. Just dont rush things. and TAKE a BREAK.

  • If you use the funds for yourself and shut down the business that can be considered fraud.

    I suggest invest some of it in buying out the founders that abandoned ship (not necessarily give them money but paying lawyers to draft up agreements) and pivot/rebrand.

    If you need ideas and help developing them, you can contact, a product studio.

    • Plus he will be known and branded as gold digger who, at the end before the ship sinks, takes all money into his private account.

      OP, you are kicking yourself out of any future investments with your behavior and get blacklisted.

  • {"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

    You may also like