We Raised $1.2M and Died of Politeness: A Post-Mortem
Our product worked, our team was talented, and we never once had the hard conversation that would have saved the company.
My second startup shut down 22 months after we raised a $1.2 million seed round. People sometimes assume we ran out of money because the product failed. That is not quite true. The product worked fine. We ran out of money because three intelligent, kind adults were too polite to tell each other the truth.
The setup
We were building scheduling software for physiotherapy clinics. My co-founders were a brilliant engineer and an operator who had run four clinics herself. On paper, the team was perfect.
We had 38 paying clinics after a year. Revenue was growing about 6 percent a month, which sounds fine until you do the maths on how long it takes to reach anything meaningful at that rate.
The conversations we did not have
Looking back at my notes, I can find at least four moments where a hard conversation was needed and quietly skipped.
- Month 7. Our engineer was rebuilding the calendar engine for the third time. I thought it was unnecessary. I said interesting approach instead of please stop.
- Month 10. Our operator was spending most of her time on custom onboarding for each clinic. It did not scale. We all knew. Nobody said it in a meeting.
- Month 13. I was spending two days a week on investor updates and conference panels. Both co-founders privately thought it was vanity work. Neither told me until the shutdown dinner.
- Month 16. Our numbers clearly said we should pivot to larger hospital groups. We discussed it for two hours, agreed it was worth exploring, and changed nothing.
Why politeness felt safe
We liked each other. We had seen other founding teams implode in public arguments, and we were proud of not being like them. Somewhere along the way, we never fight became part of our identity.
The problem is that disagreement does not disappear when you avoid it. It goes underground. It becomes sighing in standups, private messages to friends, and decisions that everyone half-supports and nobody fully owns.
What I do differently now
At my current company, we have a few explicit habits:
- A monthly no-filter meeting. One hour, founders only, where each person must raise one thing that is bothering them about the business or about each other.
- Disagree in writing. Major decisions get a one-page doc, and anyone who disagrees must write a short counter-argument. It is much easier to be honest on paper.
- Kill criteria up front. When we start an initiative, we write down the number that would make us stop. Then nobody has to be the bad guy later.
Kindness is telling your co-founder the truth early. Politeness is letting them find out from the bank balance.
We still speak, all three of us, and we still like each other. But I would trade a little of that friendship for the company we might have built if we had argued more in month seven.
Cover: Photo by Uneebo Office Design on Unsplash.
