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A failed startup built his career
The startup
The company tried to quantify mental health to give early predictors of conditions like generalized anxiety and major depression. At its biggest it had seven to ten employees. The founders were in their early twenties and had no idea what they were doing, and shutting it down meant telling investors the money was lost and the vision wasn't going to happen.
The shutdown
The founders had kept investors in the loop the whole time with monthly updates, which are easy to send when things go well and hard to send when they don't, and which avoid surprises. Even so, ending the company was brutal, it had become a big part of its founder's identity, and it took a number of years to get over.
What it left him
Before the startup he had never been a PM, never worked on products, and didn't really know how to cold email. He picked up those skills there, and they made the path to Mercury and Anthropic possible.
Why do monthly investor updates prevent surprises?
Regular updates give investors a running record of cash, progress, and problems, so bad news arrives as the next data point instead of a shock. An investor who sees trouble building can offer introductions or advice earlier, while there is still time to act. Y Combinator's startup advice recommends monthly investor updates that include asks and bad news along with progress.
Why does a failed company hurt so much?
Management researcher Dean Shepherd proposed in a 2003 paper in the Academy of Management Review that founders who lose a business go through a grief process similar to mourning a person. The stronger the founder's emotional attachment to the venture, the stronger the grief. Founders who spend years building a company often merge it with their identity, so its end can feel like losing a part of themselves.
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