This happens way more often than you might think. Congratulations on surviving to tell the tale, and best of luck with your next venture. These lessons will stand you in good stead, provided you recognize that this is only one way to kill a startup. Trust me, there are oh so many more...
(and product market fit is a necessary condition, but unfair advantage is where it is at)
thanks, I know that this happens frequently. But at the same time it feels so sad to shut down a company that was indeed starting to see pmf
It sucks, the people are everything. Integrity and execution are the main ingredients. The rest is luck. But no integrity or no execution and you implode. You literally just need integrity and execution.
Sounds like a solid learning experience.
It's also why I am incredibly hesitant to have a co-founder and it's why I went the bootstrapped approach instead of VC funding from the start.
> The co-founder demanded 10x what we could afford and threatened to sue the investor.
When this happens, you have to invert the offer and say that he can pay you that amount for you to leave instead.
We did it.
I proposed to give him my shares for FREE. He refused, knowing it was not capable of running the business.
On one hand, he told me the business value was in the millions. On the other, he would not buy the entire business for free.
Also, he always knew he could get some money suing the investor
why was it so hard to find a deal with the cofounder?
because he knew he either would get the buyout or the settlement money
What about just founding the next one alone? Will VCs still invest in that?
Yes, next time I will think very carefully about which investors to involve.
Disclaimer: I am not in a startup / tech hub. I realized that there are many more investors outside my geography. Professional investors.
Indeed I am leaving my country and starting new in another place