Kyle WiggersStartups are receiving support from investors but instead of growing, some are shutting down. With approximately 90% of startups not making it, there is a demand for companies that specialize in helping other companies close. Investors are now backing startups that assist other startups in returning unused capital, selling their assets, or fully shutting down. Additional companies are entering this space as well, aiming to make the process of closing a business more affordable, quicker, and less complex.
The co-founder of Sherwood Partners, Martin Pichinson, believes that more startups will fail, but venture capitalists are now more willing to cut their losses. One such startup, Sunset, raised $1.45 million from angel investors to help businesses close, and SimpleClosure raised $4 million within six months of raising $1.5 million in pre-seed funding. Even established companies like Carta are joining in with a new offering called Carta Conclusions.
Sunset, for example, was founded by individuals who had previously experienced business failures and wanted to create a better process for closing a company. Their aim is to serve as a “one-stop shop” for businesses looking to wind down by handling the legal, accounting, and operational aspects of the closure.
Several startup founders have embraced this approach to assist others in winding down their businesses, drawing on their own experiences. The mission of these emerging companies is to offer assistance to startups that need to shut down, covering a wide range of industries including artificial intelligence, crypto, and B2B SaaS.
Kyle Wiggers
