Can’t Objectively Tell Whether to Push Forward or End Things.

2x entrepreneur.

First venture = small. Good learning experience. Bootstrapped. About broke even. Wound it down but not a big deal. Only myself involved. No other co-founders

Second (current venture). Brought on a junior co-founder. Decided to raise money + build team, but wanted to bootstrap for a bit of time to get traction and help with the fundraise. Hit huge initial traction (revenue) out of the gate and decided to delay fundraising b/c we could. Then everything went to hell.

  • tons of production problems (stressful, but expected, so no biggie)
  • a former contractor brought a lawsuit on the company. i thought / still think the lawsuit is BS, so decided to aggressively fight it hoping it would settle or go away quickly. but didn’t happen. well into the six-digits of cost now.
  • decided to put fundraising on hold until the lawsuit was resolved. thought most investors would be scared off unless there was a clear path to resolution for the lawsuit.
  • have also put team building on hold b/c wanted an end in sight to the lawsuit before really went down that path.
  • junior co-founder is a great person, but just not the right fit. more of an employee than an equal.
  • i haven’t been taking a salary for the benefit of the company. and just can’t do that anymore.

and yet, despite all that, still think there is a promising business here. we’re still selling product and customers are happy. just not sure if i have the energy to do it. i feel stressed, defeated, and like a failure. “how did i screw things up so much to get ot this point”. i am now on anti-depressants, and some days it’s hard to get out of bed. i have a wife and a new baby and i feel like a failure for not supporting in a responsible way.

for the business to be go forward:

  • lawsuit has to be resolved
  • need to replace junior co-founder and bring on a team quckly
  • raise money
  • stabilize a shaky supply chain and get things back on track.

i’m worried that I’m just too tired at this point, too stressed, too burnt out. I need a break. And I’m worried that even if I solved the first two problems above, I shouldn’t raise money unless I’m all-in…to do otherwise would be a huge mistake. and I’m not sure i’m “all-in” because of everything that happened.

And yet becuase there is still promise here, I think if I were to shut things down I’d be forever regretful and wouldn’t have enought grit. I think the investors i’ve spoken to in casual chats would view me as a failure and this would be my lsat realistic chance to start a company. I’m in my mid-30s now. I love doing this, but my wife doesn’t want this life anymore. and I can’t blame her. If this startup doesn’t work out, I’m not sure I would ge tthe chance to do another. and I’ scared i’d have no idea I would know what to do if i weren’t running a company.

i just want a do-over…but such is life.

how do i make a decision on what to do?

  • If you’re not careful you’re going to lose everything: the wife, the startup, the lawsuit, and your sanity. Make no mistake, this is the trajectory you’re currently on.

    It’s possible to raise money while a lawsuit is ongoing, but it’s probably too late now. Forget about raising money. Forget about building a team. You don’t have the time. I take it the cash flow from your customers will allow the startup to survive for a little bit longer.

    The fact that you casually talk about “replacing the co-founder” indicates that this person was never an equal to begin with. You can’t have a co-founder that is your peer and also have them be junior and replaceable. This is like delegating responsibility without relinquishing authority. Rookie mistake. Replacing the co-founder now is impossible. So level with them instead, and maybe they will rise to the occasion. People have to grow into their co-founder role after all, but they can’t without guidance.

    Settle the suit, even on bad terms. Swallow your pride. Any settlement that doesn’t outright kill your startup is acceptable.

    Feeling stressed, defeated, and overwhelmed sucks. Being depressed and unhappy also clouds your judgement. Maybe things aren’t quite as dire as they seem. If your wife is willing to give you another 6 months to make it work, and if the lawsuit disappeared, could you make your startup work? Maybe you could!

    But talk to your wife first.

    • Agree almost 100% with this assessment. One thing I would add is that this is not your last chance.

      As far as your wife goes, she is probably feeling your emotions and looking to you for guidance and stability.

      Make good choices for your self and your family, and it will turn out ok.

  • Give yourself 1 week off – totally clear of work – it will do your health wonders and is one of the most valuable things people are in posession of. Unfortunately people sacrafice health in order to make money, but when they make money they spend it all to get their health back.

    tldr. Take stock, clear you mind, think rationalty. What would you do if you were on NZT? 😀

  • Settle the lawsuit, swallow your pride, raise the money. Things will be so much easier to handle once you get that thing off your back. You made something that people will pay money for, that’s huge!

    Don’t underestimate the toll the new baby is taking on you and your wife’s mental health right now, either. The loss of personal freedom and the sleep deprivation can easily wreck marriages and send new parents spiraling into depression, even without startups and lawsuits. Talking to a therapist or personal coach helps.

  • I’m not sure if the lawsuit can be settled quickly. if it can’t, we’re out of money b/c running out of cash and can’t easily fundraise. and then that’s that. if it does, still all the other issues to be dealt with, but at least a glimmer of hope there.

    just exhausted of running the company in such a shitty place over the last year, and beating myself up for not planning ahead better, not building a better team when i could have, not having raised money when i could have. especially with a wife and a kid i’m just not being a good parent. quitting seems easier, but i know some part of me would regret quitting and not fighting for success with all the traction we have. mind is still in dark places.

    really do appreciate all your replies.

  • Nobody’s perfect. We’ve all had shitty years. If you can get this far with a lawsuit dragging you down, I bet you could fix the rest of the problems once it’s gone. You have happy, paying customers; the business can survive these setbacks (even running out of money for a while, probably) if you’re willing to keep doing it. Your kid will be totally fine. Your marriage is likely undergoing some real damage right now, but even that can be fixed if you clear your head a little bit and put some work into apologizing and paying more attention to what she needs.

    You’re a good person. You’re going to be a good parent. Chin up!

      • Like I said, ‘clear your mind’, take 1 week off – it’s nothing in the grand scheme of things but will give you time to think rationally and consider your priorities.

  • Based on your summary, you actually only have 1 problem and task (which is holding everything else back)- resolve your lawsuit.

    To be frank (since it apparently has not proceeded as you expected)- what is your honest current prognosis for this lawsuit? What is the honest prognosis of your lawyer?

    Are you hoping for some sort of magical resolution to pop up, so you can move forward with your company? (it kinda sorta sounds like you are at this point…) You need to somehow get ahead of this so you can steer the lawsuit towards some sort of solution, but this can only happen if you are honest with yourself about it.

    You also want to have a deep, open talk with your wife about everything that is happening- about the company, about the lawsuit, and about your feelings and fears.

    • I forgot to mention- regarding the junior co-founder…is it really necessary to replace him, or just add an additional founder/principal member? I feel like that’s water under the bridge at this point. If he was unethical or somehow actually hurting the company that would be a different matter, but it does not sound that way. If he’s reasonably smart and capable, perhaps you can at least coach him up too, for both your benefit.

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