Ask HN: My startup has failed. What comes next?

Hey man, Elon Musk's rocket blew up today. Even the best of us don't succeed every time. Just think carefully about your possible courses of action and try planning out different routes in your head ("If I worked in city X for a year doing Y, I could save Z, and then in my free time I could...", "If I went straight on to this startup then I could...", "If I went to work at this cool startup I know in a field I'm interested in, then....") and see which one makes the most sense to you.

I know this is cliché stuff but remember Thomas Edison's 1000 ways not to make a lightbulb, and JK Rowling getting rejected from a dozen publishers, and Elon Musk nearly going bankrupt in 2008, and that Abraham Lincoln didn't do anything particularly notable whatsoever prior to turning 52.

What do you want to come next?

If you can constructively and reliably ship code to prod, you almost certainly have better immediate options than Elance.

Worst case, calling ten different web agencies in your area will probably get you enough work to pay the bills, likely at rates which are not unreasonable, and with far less pathological clients than you'd find on Elance. You might have to call another ten after that, if your luck is bad or if your sales skills are poor.

After that, what? Full-time job? Freelancing? Another startup? Get out of software and into the exciting world of fruit vending?

It's a wide world and you have skills that are in high demand. What do you want the next chapter in your life to be about?

Our startup failed early this year. We didn't make any money and while we did have a few interested clients, to keep going we needed funding that didn't come. End of the day, it was the wrong product. Period.

So - lesson learned.

I did try odesk/elance for a while but you can't make any money from it. My work is more embedded, and systems programming and the jobs on places like odesk are suited for very low end webdev. (The good webdev work isn't on odesk). As a result, they are very low paying.

I called that quits pretty quickly and started looking for a job. It took me a couple of interviews (including bombing the first one) before I found work. I'm pretty happy now. It pays the bills, but I am saving up for my next startup sometime in the future.

In short, don't be disheartened. Very few actually make it, but the journey is one that's really worth it. Sometime later you will find the right idea and your motivation will be up again.

1. Pay the bills, save some money.

2. Take a vacation: "Me and my friends have been too busy sunbathing off the southern coast of St. Bart's with spider monkeys for the past two weeks, tripping on acid. Changed our whole perspective on shit."

3. Tinker: https://www.physics.ohio-state.edu/~kilcup/262/feynman.html

   > My motivation levels are also pretty low after so many
   > repeated failures.

Many people I've known have gone to work for a larger, more stable, company to build up a reserve before putting their hat back in the ring. Sometimes they will take a different job (like working in product management instead of engineering) to round out their skill sets based on what they felt good at, or weak at, during their startup experience. Others have gone back to school to get additional training that way.

Much of it depends on your resources and what your mental state. I find it to write down in a journal as many things I can think of from the previous experience and what strategies would have either made them more impactfull or mitigate their damage. If nothing else it meant I was unlikely to repeat previous mistakes.

I did my startup for almost 4 years. It was this:

https://github.com/scalien/scaliendb

After the startup, I was "unemployed" for about 1-2 month. Then I took a chance and went to work for Prezi as an engineer. It was a really good choice. During the startup it was 2 of us coding along, not much social interaction. At Prezi there's tons of people, diversity, it was a nice break. Also, good challenges, lots of learnings. I'm approaching the end of my 3rd year here, I hope to also do a 4th. Right now I'm a "Director", which is like a engineering manager. So I'm also learning about how to manage people. After Prezi I don't know what I will do, doing another startup is at the top of the list, but we'll see...

Just some suggestions through the tough times:

  - Talk to friends and family who understand
  - See if there are ways that the work done can be absorbed into another company
  - Drop a note to mentors/ advisors when you are professionally ready
  - Do some small projects for companies in your network who can pay on time, and hopefully also let you slowly ease into a different team and environment
  - Cut down on expenses
  - Plan your project portfolio and resume
  - Try to do at least some light exercise regularly (e.g. 3 times weekly)
  - Try to see how you close the loose ends (tough, but take as much time as you need and take into account your mental state)
  - Don't force yourself to go all out socially
  - Write down thoughts about why you think the startup failed, organize it later when you can look at it calmly
  - Don't try to over-analyse the situation
  - May want to explore meditation
  - May want to explore religion as a way of thinking about life's meaning and putting things in perspective

The first I would recommend you do is talk to your investors connect with them on a human level and explain why the business tanked. I did this in my case and one of the investors went on to land me very good contract.

Second I would recommend analyzing really well what caused the situation. Rarely is the answer running out of money the real reason. In my case the best way I found to deal with this is to give talks in my ecosystem on why my startup failed. This way it gave me a better chance to figure things properly because I had to explain them.

Third I would not recommend things such as Elance or Odesk, but rather direct consulting with people. I have done this personally and the financial payback from direct consulting is incomparably better then online marketplaces of services. The bottom line is that in direct consulting people are looking for your expertise while on Elance they are looking for code and we as software engineers produce code but what we sell is the expertise (ie the code is only the means to the end). Fourth for your motivation levels I would recommend forming a sporting habit. Personally I run long distances and I find it helps me stay "earthed". On the really off days I find reading science fiction is quite helpful but that is just me. Finally I would like to point our that your startup has only failed if you do not see the rewards at the end of the journey and only focus on that you missed your goal. As an example Columbus failed to reach India by a new route. If he had only focused on that he would have never gone back with the fact that he had discovered the Americas.

Know thyself and accept that you may need a little bit of a mental health break before you're ready to jump back in.

You are probably much more employable than you think. You probably also have more connections than you realise.

As soon as you're ready, reach out to the people you know in the industry both locally and elsewhere. Let them know that you're looking for work and the kind of work you're interested in doing.

What worked well for me when I was in your situation was short term technical work with no managerial component. I found it quite relaxing to just show up, write code for a client, then go home. No team to worry about, no wage bill looming, just some issues in the backlog.

After I'd done that for a little while, I was back in a position to stretch myself again.

Just one tip: Don't just follow the money if you're a product guy and get attached to your team and work. I quit a disintegrating startup with burnout and went right into the best paying corporate job, not realizing it was compensation for personal suffering. Dealing with 10 years of technical debt and a hot mess of legacy architecture together with a erm... wide variance in coworker's & bosses competence stressed me out just as much, and i quit no 12 months later.

If your motivation levels are pretty low, you may want to delay job searching for a bit. Looking for the right job is hard and comes with its own setbacks that you need to be prepared for.

I started looking for a job in May. It takes a lot of time finding the right kind of company, going through all the interviews, and determining whether there's a fit. It's very draining and, of course, rejection always stinks.

You probably have a lot of great skills you picked up from building your startup, but practically no interview judges you on that kind of experience. I've encountered two main assessments: the take-home challenge and algorithm coding. Honestly, algorithm coding punched me right in the face when I started looking for jobs. It took me a little while to get back into the algorithm mentality (leetcode helped a lot).

Take home challenges are frustrating. You can put in a whole days worth of effort with no guarantee of getting to the next step where you can talk about your awesome startup experience. What's worse is that you probably are interested in the company because, otherwise, you wouldn't have put in the effort in the first place.

If you aren't ready to face this yet, I recommend picking up small coding jobs for a bit to get your spirits up and work on interview prep.

This happened to me. I worked on a side project in high school that grew into a company after about eight years of work. Three years and a pivot later we gave up due to decreasing traction, and returned whatever funds were left to the investors.

I moved back to my parents for about a year to work on other side projects, but ended up looking for a job and found an awesome small company that I'm very happy working for. I'm still working on market-focused side projects and without the stress of having to make money/gain traction it's a lot more fun. I really prefer this setup, especially since a small company allows me to scratch most product-development itches I have since there's not a lot of bureaucracy.

A lesson I've learned: Quit early. If you feel bad about the project right now, end it as soon as possible As in, tomrrow. Don't stick around waiting for the big break. I've done exactly that, and while we actually ended up with some paying customers after our pivot, we would've had to achieve an insane growth to be worth anything to my co-founder and me due to the dilution of our shares. It's not worth basically building a new company for the smaller fraction of shares you have after taking an investment.

Id take a few weeks for yourself, then find a 6 month contract. That'll get you back on your feet again professionally and financially. Depending on how the contract rates are in your area, you should then have a small runway again to think about your options. Id avoid committing to anything too big too early.

I don't know the details of your startup, but if possible can you reduce costs / reduce scope of services to the point its self sustainable? If so, go for it. I've regretted shutting down past projects, sometimes a bit of time off can give you new perspectives on things, and you've presumably built some value even if its not realised yet. YMMV but something to think about rather than outright closing it all down.

I highly recommend taking some time for yourself first, just to reconnect to your loved ones and find some kind of stasis in your life. You're going to need the space to rebuild your confidence levels to be able to show the moxie needed to land the right position.

I have found that taking consulting work is a good way to buffer your income for a while, until you find the position that is right for you.

I don't know if e-lance is the correct way to go about it tho, because there is an element of social branding and networking related to all of this.

You could start blogging, or do some presentations at local user groups of various techs. Writing about experiences like what you have been through can actually be very freeing.

An innovation does not have to be a business idea, remember that. Supporting yourself can be incredibly cheap without a 9-5. Joining a team at a real office can develop your skills in ways you'd never imagine - but it's not right for everyone. It's not 'giving up' either - it can open up new opportunities, but make sure you still work towards total independence if you do that - and consider working for someone else's startup that might have more traction.

2 years is a long time - I've been in situations similar. I don't let projects last that long anymore. Motivation is an extremely important thing. You need to find what you love so you can enjoy working on it without the only carrot being a big payoff. NEVER force yourself to work on projects you don't enjoy. In life we have to do things we don't enjoy like paying taxes, apologizing, going to the DMV - but when it comes to your projects you cannot expect yourself to excel in something you don't absolutely love. You can always do 'ok' in those things but it's debilitating after a while.

Take a month, if you can afford it, to hone your skills - watch youtube videos, read a book (Meditations by Marcus Aurelius is what was once recommended to me and I recommend it to pepole all the time in these situations).

Be strong. Let the thing go, don't look back, don't jump into the next thing so fast - make sure you're taking your life in the direction you want it to go. Take a minute to pause, meditate - most people experience 'failures' because they only ever work on a business venture where success is binary - either you're profitable or you're not after x time. If, however, your goal is to better yourself, to build things that you can use and you want, to explore - to not worry about trying to make money with every concept you work on, but to be open to the possibility of it.

You can do amazing things - just admit to yourself what your shortcomings are personally, what your failures were in your last venture - and how to set up your life so that no matter what happens, it will be impossible to 'fail' because you no longer look at things as such a strict dichotomy.

If your project failed, and you can take some time off, go or it. I'd suggest joining an obviously-successful project for a year or two after (a "unicorn", although they're not all great, is a good choice; a successful team at a successful company is, too), then doing a startup again if you feel like it.

Taking more than a few months off might be counterproductive (and expensive), and getting trapped doing consulting/contracting doesn't contribute as much to doing another startup again later.

I was in the same situation as you at the end of last year. After 2.5 years working on a Techstars VC funded startup as a co-founder, we failed. Unfortunately at the time, I didn't have the extra cash to take time off, so I sent a few emails out (to the Techstars network) and a few weeks later jumped onboard another early startup as the first engineering hire. I honestly wasn't sure if I wanted to join another early stage company, but they offered a nice salary (I obviously chose salary over equity), a nice bonus, + some equity. They were the perfect fit for me, so things worked out well.

If you have the $$ to travel before moving on, I would advise you to take some time off to relax and get your mind away from the startup world. Go see your family, it's amazing how much they care.

Lastly, you will experience many emotions for many months following, don't take it too hard. Life goes on, things happen for a reason, and good luck! It will all work out.

Contracted for a bit. When I had enough cash in the bank after a month or two I took a few months off and did some travel.

I couldn't even bear the thought of another startup (while it was always a long term goal) until I took a break. Now I'm back in the grind.

Shit happens unfortunately, its how you pick yourself up and dust yourself up that separates us. Best of luck.

Life goes on. Please forgive yourself whatever happened in the past. In my case i started lokking for a job under stress and failed with the first one, so please rank your interviews and go to least interesting ones first. Sometimes going the ones you will never except helps, you will never now what it will bring to you. Good luck!

From experience, I can say that it's stressful and unsatisfying to do approximately "nothing." I recommend taking a hard look at your finances and setting up some kind of concrete goal(s). Take that class, build that joke app, polish your resume -- Whatever it is, just have your goal clearly defined and at the right difficulty level. You've basically just been transported forward in time 2 years and you're sure to have a lot of culture to catch up on, friends, family and acquaintances with whom to reconnect, and reflective thoughts to ponder. Don't be too hard on yourself as you build a new foundation from which you'll make your next move. As for money, my advice is to be wary of stringing along odd jobs for income. I think that kind of instability does more to harm your environment of freedom than to extend your runway of cocoon-mode.

I do not know details, but it seems the biggest mistake was not failing before cash ended. I had two startups that were successes, but I had other few which were failures. The trick, back then, was to set a certain threshold in which we could call success or failure, and move on.

If you happen to have spared some cash before the actual declaration of failure, consider to take a 3 months break (I did). 3 months break does not mean not working, but actually removing from your life entirely any concerns for future plans or making another business.

It is a sort of short and strong detox, that will allow you to regroup and think better what's come next. But keep doing business... Those who felt the taste of startup never really let that go. For some reason, I can't explain, it is addictive.

I got a corporate job after my most recent failure.

I am working on another idea on the side now - but it took me a good few months to recover before even wanting to work on something in my own time.

That was my first real total failure. We had €50k funding received with no notion of what to do with it - and I left before the money was even drawn down.

My advice is to relax. Take some time, play some video games, drink some beers with friends, and read some books.

If it's in your blood, you will bounce back.

I started over with different idea, moved to a place where I can pay less, can live sparingly. what I learnt helped to develop/market 5x faster.

Did you start looking for a job? Did you jump straight into your next startup

I'm always curious about comments like this. Do you have enough personal reserves to go into startup mode again and still pay rent/mortgage, household expenses for another year, whatever?

Personally I wasn't a great coder after my startup failed (right after college). So I went to Fullstack Academy, and then got a job as a web developer. I plan on taking another stab at it once I get some more experience though.

maybe the best thing is just to find someone to talk to in person. Someone outside looking in whose mind isn't as bogged down by the startup and can offer a more uplifting 3rd party view

I'd find someone like that to talk to in person over a beer, before jumping into what's next

These are my two different experiences and hopefully one of them might help you.

My first startup didn't go that badly, which is why it left me with enough cash for rainy day during my 2nd / 3rd startup.

So without saying, yes the 2nd and 3rd crashed n burnt pretty badly.

Experience after 2nd:

I know this might sound meta, but your sanity and your self worth more than anything else and that's what you should be looking at. I was a noob by all means when I did my 2nd startup, because my first startup had an early acquisition which I didn't really go through a lot of things. So due to that my 2nd time it left me with a lot of bruises of rookie mistakes.

It was awful, but I decided take school and help me forget about Startups, business and the sorts of things I was obsessed was before. So this helped because I got to talk to people whom were not necessarily talking startup and business, which diverts your anger/disappointment towards something different.

After 3rd startup:(run out of money, quite literally)

After my 2nd startup I had enough cash to not get a job, but this time around I had a lot more pressure which left me with no choice, but getting a job. I had some great investors whom knew why I fall into this situation, which helped a lot.

Few things I did:

1- I put behind everything I was hopping for before, because I knew that I have reached a new low (which is not good).

2- Making new hopes!

3- I started fresh (joined a tiny startup and worked for them like it was my first ever time programming / building a team).

Things learned:

1- I wouldn't jump into another startup of your own. (don't, just don't) The pressure becomes too much and productivity tanks.

2- Make sure you agree on leaving behind the miseries of a startup to start something new (aka joining a team). It's a good time to let go of things when you feel your shoulder is holding too much.

3- Your sanity and your life is the most precious thing you have, after my 3rd startup I had death threats and that was the reason I had to let it go. So things like that shows you how cheap life can be in others eyes, while for you, that is the biggest asset you have your control over.

So feeling shitty or guilt shouldn't stop you from going into something new.

Also, if you have enough of experience with programming and building, then you can do some consulting or freelancing very easily.

PS: if you're in based States don't freaking try Elance or Odesk. Because that will just destroy your thoughts more, it's like race to the bottom for prices. Try using HN (Who is Hiring) or Reddit /r/forhire or Twitter or friends to get some gig.

Ah and one last thing, ego and pride can be hard to get over, but don't bury them, because these times will be your medal of honor and soon enough you can feel proud of them.

I don't have "real startup" experience with, you know, investors and stuff. But I do have failure experience. Without funding, the line between failure and not is way more blurry; but you fail the same. Sometimes those failures come with emotional problems, sometimes not. When failures don't come with emotional problems, cleanup is easy. Get a job and do financial cleanup.

When the failures come with emotional problems, well, then it's harder. For me? I think it's a bad idea to go to my contacts when my performance is below a certain level, because... I'm just not performing up to my usual standards, and actually doing a job with people who expect me to perform at the level of most of my friends would be a challenge when I'm fully functional. And when I'm really messed up? expecting me to perform at the level I've been capable of performing at in the past is a bit unrealistic.

But, the problem is that my job is absolutely central to who I am. I'm not going to get better until I get a job and feel like I'm making forward progress at that job. That's just how I work.

So... personally? I go through body shops when I'm like this. Why? Mostly because employers don't go for the body shop until they've exhausted their contacts. They don't know any more good people, so they'll settle for warm bodies. And depressed-me can meet those standards, usually. I'll probably even have enough skill-margin for them to put up with the downsides of me still being messed up.

And eh, I've had good luck with getting help from the managers; I mean, my big problem is staying on-task, and that gets way worse when I'm not in a good place, mentally, and my experience? managers in those situations seem to be pretty cool with me asking them for help with that sort of thing. I think they know the score, too. They know they're gonna get second-raters from the body shop, and they're willing to put some effort if it looks like some effort can turn you into something useful.

When the economy is good like this, most of the gigs you will find are "contract to hire" - meaning you work for them for a year, and if the economy is still good in a year, they'll offer to hire you on full-time, which gives you a nice path forward, if you still need training wheels after the first year is up. When the economy is bad, that expectation isn't set, but the rules are about the same either way.

Oh yeah, to get a body shop job? put your resume on DICE. take the calls, listen carefully, reject jobs you aren't qualified for (the body shops aren't qualified to do that, and you will go to a lot of interviews for jobs you aren't qualified for if you don't take charge of the filtering)

But yeah, especially if you are in the bay area, body shops are like a million times better than e-lance

bankruptcy

Couple of things: Can you sell your code? If not consider open sourcing it. Either you get some money or you get some kudos in the community.

If you still want to work in startups, look at the post a few pages back for people looking for founders: https://news.ycombinator.com/item?id=9795503