Thoughts

How to Cope with a Startup Closing: Ruslan Tymofieiev Breaks Down Main Points

Oct 15, 2025 | By Team SR

The hardest line a founder will ever write is the one announcing a shutdown. In Ukraine, where macro shocks are part of the job description, that line is painfully familiar. Markets move, capital tightens, and even strong teams mistime launches. Yet Ukrainian investor Ruslan Tymofieiev argues that failure can be a starting point, not an obituary. Here, the founder of CLUST and managing partner of the venture fund Adventures Lab breaks down what to do after a closure and how to get ready for your next launch.

Common Reasons Why Startups Close

Ruslan Tymofieiev’s view is pragmatic: you can’t control everything, but you can see trouble sooner. These are the patterns he tells teams to track before growth masks the risks:

  • Lack of funding. It often starts as «no investor interest» at the earliest stage — signals are thin, the story is unproven, and checks don’t materialize — then compounds during growth when capital must steadily finance hiring, infrastructure, and acquisition. Without adequate backing, momentum stalls: the company can’t fund the experiments and capacity needed to lift retention and lower CAC, so growth never clears the threshold required to escape the valley of death. Runway shortens, milestones slip, and each round gets harder as burnout surpasses learning. 
  • No product–market fit. Most startups begin with a clever idea for solving a problem — but founders often fall in love with the solution, not the user. Because the core problem remains unsolved, you see weak activation, poor retention, low usage, and growth that exists only because of paid acquisition. That’s why about 42% of startups shut down: the problem founders think matters simply isn’t in demand with customers.
  • Wrong timing when entering the market. Launching too soon exposes users to an unfinished product, which triggers negative reviews, low retention, and high re-acquisition costs. Ship too late and the window narrows: incumbents entrench, switching costs rise, category narratives solidify. Good timing means the market is ready — clear customer pain, enabling technology, workable regulations, and supporting products — and the company is ready too, with a solid quality bar, effective onboarding and support, and a credible go-to-market plan.
  • Team conflicts or lack of expertise. Startups run on people, and investors invest in founders as much as in the idea. When vision, values, or incentives diverge, momentum stalls, and disputes can escalate to boardroom battles or even litigation. Single-founder companies also face a bus factor risk: if the leader is unavailable, execution can grind to a halt. Inside the org, misaligned roles, weak authority, or «performative work» erode trust and belief, turning months of burn into little progress.
  • External factors. Even strong teams can be overwhelmed by shocks: recessions can crush demand, supply chains can snap, platforms or regulations can shift overnight, and funding can dry up just when a runway matters most. Ukrainian entrepreneurs know this firsthand — COVID-19 and the full-scale war proved that not all variables are within a founder’s control.

The Emotional Side: How to Overcome the Business Shutdown 

When a startup closes, the body and mind react like to any major loss — numbness, denial, anger, and swings between overworking and avoidance. Don’t paper over it with busywork. Ruslan Tymofieiev recommends naming what you feel: grief, shame, or fear. Keep it simple: brief journaling, a daily walk, and breathing drills help you process your feelings rather than bottling them up, which can prevent burnout or cynicism later.

Ruslan emphasizes this distinction: the venture failed, not the founder. Convert guilt into actionable data instead of self-criticism. He argues that post-mortems should replace global judgments with testable facts: this attempt failed because the ICP was too broad or pricing undermined payback, not because the founder «is a failure». For Ruslan Tymofieiev, the discipline is the same as any experiment review: map what was in the team’s control, what wasn’t, and what will change on the next build — so learning resumes and momentum returns.

He recommends engaging partners, team, and mentors early to align the story, designate owners for wind-down work — finance, customer commitments, communications, legal — and protect relationships for the next chapter. Early coordination, he argues, curbs rumors, preserves trust with customers and candidates, and reduces legal risk by ensuring disclosures are consistent and timely.

An outside perspective — from a therapist, coach, or founder community — helps separate signal from noise, align decisions with clear benchmarks, and surface practical opportunities, such as warm introductions, references, interview preparation, acqui-hire leads, and asset sales. Ruslan Tymofieiev also recommends a tight cadence and toolkit — a one-page narrative, FAQ for customers and employees, a closure checklist, and a weekly cash/obligations review — because organized, humane execution signals integrity to future investors and employers, shortens the recovery curve, and converts a painful ending into usable momentum for the next chapter.

Practical Steps After Closing: How to Do Everything Right

In Ruslan’s view, doing the basics right after a shutdown is a founder’s strongest signal of integrity. The steps that follow turn chaos into order and preserve options for the next build:

  • Reach a formal consensus and document it. Ruslan urges founders to follow governance to the letter: secure board and partner resolutions on dissolution, timelines, and asset or IP disposition. Capture everything in writing per charters, bylaws, and investor agreements.
  • Create a closure checklist. Retain corporate, employment, tax, and IP counsel. Create a single checklist covering license/permit cancellations, IP assignments, contract terminations, WARN/notice obligations, and state filings — with a named owner and due date for each item.
  • Comply with employment and labor laws. Pay all wages through the closing date and any required PTO and severance. Issue final pay stubs and benefits notices; handle access offboarding securely.
  • Resolve financial obligations methodically. File final state income and sales tax returns, close out payroll and remit all payroll taxes while notifying agencies you’ll cease filings, notify creditors and settle debts with documented plans, and reconcile/close bank accounts only after obligations clear.
  • Communicate transparently with all stakeholders. Host a candid all-hands, with individual 1:1s, and share a written FAQ that covers timing, pay/benefits, references, and IP/portfolio transitions. For customers, publish wind-down dates, data/export options, service handling, and recommended alternatives. Then, for suppliers and vendors, provide notice, confirm final deliveries, and settle open POs. Finally, for investors, share a formal update covering causes, remaining cash, liabilities, and next steps, and keep a secure data room open until wrap-up.
  • Preserve relationships for the next chapter. Provide proactive references for team members, warm introductions for job searches, and thank-you notes to customers, mentors, and investors. Offer investors a brief debrief call and share future interests to keep doors open. Schedule time to decompress, then convert the post-mortem into a portfolio of what was built, the traction achieved, and a refined thesis to carry into the next venture.

Opportunities Opened by the Experience of Closing a Business

Ruslan Tymofieiev argues that even a shutdown leaves founders with assets that compound. Chief among them is experience that can’t be learned from books: partner choice matters as much as product, leadership changes can flip a «good» relationship overnight, and cash signals are governance alarms, not quirks. He urges founders to codify what they learned in a brief memo — three controllable causes, three concrete changes — so the knowledge becomes reusable, not just painful.

He also emphasizes the network that survives the product: investors, customers, vendors, and advisors often prove more valuable than the cap table ever did.  A lightweight portfolio of «what we built, what we proved, what we’d do differently» converts sympathy into concrete opportunities.

Finally, he stresses that reputation at exit outweighs the fact of closure. An orderly, humane shutdown — meeting obligations, communicating consistently, documenting data exports, and thanking stakeholders — builds reputational equity for years. Investors and operators remember founders who surface problems early, keep agreements in writing, and protect teams and customers on the way out; that integrity becomes the opening paragraph of the next partnership or fundraising conversation.

Turning Failure Into Opportunity

Many founders go on to build stronger companies after a closure because the scar tissue becomes a competitive advantage: they develop sharper customer instincts, stricter cash discipline, and faster kill criteria for bad bets. As Ruslan Tymofieiev notes, a clean, transparent wind-down actually raises a founder’s credibility  —investors and future teammates see integrity, pattern recognition, and the ability to execute under pressure. On the next build, these founders validate demand earlier, recruit for complementary skills instead of convenience, price to true value, and structure governance that prevents old failure modes. The result isn’t just resilience, it’s velocity — shorter cycles to product–market fit, better unit economics, and a clearer narrative that attracts capital and partners who prefer learned operators over lucky ones.

Ruslan Tymofieiev points to Petcube’s near-fatal manufacturing shock — molds seized at a partner factory while the team was already late to Kickstarter — as a case where survival hinged on people, not capital. In his view, the seven-person team, backed by trusted partners, closed a catastrophic supply-chain gap — showing that disciplined communication and coordinated effort can turn a production crisis into a launch rather than a shutdown.

He also highlights Uklon’s response to an 80–90% demand collapse in the first weeks of the full-scale war: accelerate the franchise play already on the roadmap. By opting for a capital-light franchise expansion that preserved cash for the team — and by positioning ride-hailing as the connective layer for broader ecosystems — Uklon built a resilient path back to growth and strategic options despite severe macro pressure.

Ruslan Tymofieiev underscores that resilience isn’t just endurance — it’s the practical readiness to launch again with speed and clarity. He advises founders to keep a «restart kit»: a personal runway and budget, a one-page thesis of the next market to explore, a 90-day plan for customer interviews and small experiments, and a short list of mentors and prospective co-founders to contact on day one. Emotional hygiene matters too — including sleep, exercise, and a weekly reflection cadence — because stable routines can help shorten the dip after a shutdown. He stresses laying reputational and relational groundwork — finish cleanly, write down what you learned, and keep stakeholders engaged so you can tap references, intros, and first checks on your next build. In Ruslan’s view, this mix of mindset and mechanics turns resilience into momentum.

Ruslan Tymofieiev’s closing advice is simple: end well, write it down, and start small again. The most valuable asset you carry out of a shutdown is a clear record of what you learned and the relationships you preserved by acting transparently. He urges founders to leave a clean cap table and paper trail, send honest updates, and give teammates strong references — because that integrity becomes your seed round for the next venture. He thinks that you need to treat the loss like tuition: if you keep your reputation intact and your learning compounding, the next build won’t just be a comeback — it will be better on purpose.

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