The Goodbye Call That Ended My Startup

🛠️A Sharp Model

Mental Mosaic- Timeless wisdom, made actionable for life, work & money.

Rather than wondering whether Zohran Mamdani and Donald Trump hugging it out will make Thanksgiving less political, here’s something more useful.
Skip to the Startup Formula halfway down — but first, a quick story about the moment my own company almost made it… and then died.

The Near-Miss

My cofounder and I had spent three years developing promising new software when suddenly, our world was unraveling.

On the surface, we were thriving. We were deep into developing a software system that could determine whether a company was performing well (or poorly) by pulling financial data directly from its accounting software. No human intervention necessary. AI before it was cool.

A private equity firm was putting our software through the paces. We passed every test.

But behind the scenes, we were approaching a cliff. Cash and patience were critically low when our CTO, a programming wizard, dealt us a decisive blow: he was stepping down. Our fundraising calls hadn’t borne fruit, and, understandably, he couldn’t keep coding by himself.

The most crushing type of defeat is the near miss. That same week, we got the call any entrepreneur would dream of. But it was too late.

Cut to the firm partner with a 1000-watt smile, beaming at us over Zoom:

“We love the software. We want to deploy it across the entire firm. How soon can this happen?”

It was a moment of whiplash. Actually, we have to close up shop, we told him, but thank you for working with us. We made it a goodbye call. End of startup.

This was my third run at building a startup, and the most ambitious one to date. We were designing a fully functioning, enterprise-ready piece of software by bootstrapping, a Herculean task. It absorbed thousands of dollars and three years of burning the midnight oil.

Like many startups, we developed a solid idea but failed to build an organization capable of nurturing it.

I want to help you avoid this fate.

The Startup Formula (Mistakes & Lessons)

I’m sharing the most common pitfalls that seem to derail startups (including mine) and how to overcome them. This is also, perhaps selfishly, a reminder to myself.

A few caveats: my definition of a startup is something you create from your mind, which doesn’t already exist. It’s most commonly associated with technology, but it can also refer to a new restaurant, product, or invention.

Before launching a startup, avoid the following mistakes:

1. Founding Team

Mistake:
We misaligned on risk and time. One founder wanted moonshots; others wanted stability. Uneven commitment slowly bred resentment.

Lesson:
A startup is a marriage. Align vision, risk tolerance, and workload early. The magic happens when a Jobs finds his Wozniak.

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2. Relationships

Mistake:
Across three startups, we had no real Rolodex—so we leaned on cold emails and distant introductions. It slowed everything down.

Lesson:
Your first customers and investors come from who you can call—and who they can call. Map your network in three columns: customers, funding, and help. Call a few. Whoever shows up is your real starting line.

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3. Cash

Mistake:
We assumed we’d “figure out the money later.” But you can’t test-fly a plane without fuel.

Lesson:
Be explicit about where capital will come from. Great startups raise (or earn) early. When uncertain, ask for a small check. It reveals who believes.

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4. Market

Mistake:
We rushed into building our product before talking to real customers. Excitement replaced validation.

Lesson:
Let the market speak first. Talk to 20–50 people in and around the industry. Build only after you’ve heard enough truth.

The Gamble Behind Trader Joe’s

The two most critical phases for a startup are the launch and the suck.

The launch is easy. The late nights and sacrifices feel exciting. Then comes the long middle, or the suck: when the novelty fades and every day becomes a choice between investing another dollar into the company or covering your own life. This is where most founders break.

Heroic founders push through the suck.

If you want a model of someone who went through the suck with market validation at his back, look at Trader Joe’s.

Before Trader Joe’s was a cult favorite, it was Pronto Markets—small, unassuming, and run by a young Joe Coulombe who noticed something his parent company didn’t: people kept showing up.

When the company stepped away, Joe doubled down. He bought the chain, took on debt, and even asked his employees to buy shares. A gambler’s move, but not a blind one. He could feel the demand rising under his feet.

Owning Pronto gave him the freedom to reinvent it. In 1967, that leap became the first Trader Joe’s.

Big outcomes often start the same way: one person betting on a signal everyone else ignored.

When to Push On vs. Recalibrate

So how do you know when to push on and when to step back and recalibrate?

The key is customer validation: Are sales growing? Is the market pulling? How have you de-risked the business? The market’s signal—not your optimism—is the compass.

Too often, founders love their idea. But look for hard, tangible evidence: demand, funding, retention. Are customers clamoring for your product?

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Let’s Build Together

Part of the motivation for writing this Substack is to connect with others and hear about their work. Do you have an idea you’re excited about? Do you want a more detailed checklist to test your project?

Leave a comment on what you’re building, what you aspire to develop, or what challenges seem to be cropping up, or email me at mental.mosaic88@gmail.com.

I’ll send you a much more detailed checklist.