As a CFO, I've always hated how much of my day is choosing between control and speed.

You either get real-time visibility or you get your team moving fast — never both.

My Brex card is different. Brex gives me the controls I need without slowing down important expenses, like Wally’s dog treats or Producer Ben’s cool gizmo sound things. With Brex, receipts are automated, expenses hit in real time, and categorization doesn't require three people and a spreadsheet. I can see exactly where money's going while we focus on growing the Mostly Metrics world empire (also, Sales Guy Matthew, just because you CAN expense and eat $32 of Chipotle doesn’t mean you HAVE TO).

Finance doesn’t have to slow companies down - it can and should push them forward.

See why 35,000+ global companies (and me!) use Brex to spend smarter and move faster:

Yo, it's CJ! Welcome back to my newsletter for current and aspiring CFOs. My goal is to make YOU better at your job by covering

All in a way you can actually understand.

I also help with two things that keep CFOs up at night: picking the right software and hiring the right people.

Trigger warning. What follows is going to conjure up dark memories for some of you. Just know, there’s a light on the other side!

I’ve shut down a company. It sucks. Like, it’s the worst.

For those who haven’t, there are two deaths of a company.

The first is when you mentally give up. You stop chasing any whiffs of hope, like an anxious, cortisol zapped rat in a maze, scrambling between continually closing doors.

The second death is when you finish paying all the random taxes and fees associated with failure (talk about kicking a man when he’s down).

Nobody covers that part.

The part where you’re in your kitchen at 11pm reading an email from your Delaware registered agent about a company you thought you closed six months ago. Or nervously opening that mystery IRS letter that shows up in your parent’s mailbox a year later (also, did I really start this company when I was still living with my parents?).

Shutting down a startup is sad. But it’s also expensive, bureaucratic, and will keep haunting you long after you’ve emotionally moved on (if you don’t close the loop correctly). That domain on auto-renew (guilty as charged). The AWS bill that just keeps coming (they force you to have a credit card on file at all times, so I had to literally cancel the card). The state of Massachusetts, who has never once cared about your product market fit, yet now very much cares that you still owe franchise tax.

As a finance person, you probably understand runway math better than the average founder. What you might not know is what procedurally occurs when the road runs out. Or what it costs.

That’s what this is. A lot of the underlying data comes from SimpleClosure, who’ve made it their business to help founders navigate this particular circle of hell (worth bookmarking if you ever need them. And they aren’t a sponsor, I just think they have a cool business model).

When a startup runs out of road, there are exactly three choices.

Go back out and start asking for money. Some call it a bridge. Some call it a down round. Whatever the term, it’s oxygen. Sometimes this works, but more often it buys a quarter while the team starts exploring their options. As Phil Collins said, your employees can most certainly feel it coming in the air tonight.

If capital isn’t coming, the fire sale route: sell the team, the tech, the contracts.

Acqui-hires are all the rage these days (now even for very successful companies). There’s often some hard value in the parts even when the whole didn’t work.

The thing that trips people up: most of these deals are asset sales, not stock sales. The buyer takes what they want: the engineers, the IP, maybe two customer logos. And they leave everything else. Including the liabilities. Including the Delaware franchise tax bill. Including the corporate entity itself, which is now your empty husk to dispose of.

Roughly a third of founders using SimpleClosure had already “sold their company” before they reached out for help. The asset deal was done and they’d moved on. Many had even started their next company. And then they discovered they still had a zombie LLC legally existing and accruing obligations.

This is where you stop trying to save the ship and start focusing on docking it without destroying the dock (Tangent: I nearly destroyed a dock in my dad’s boat once, flinging my college roommate Dion off the back. He was wearing jeans and a backpack and it was October Cape Cod water). Let’s talk about the dock.

A wind-down isn’t a founder decision if you’ve taken on outside capital. It’s a board decision, followed by a shareholder vote, followed by a stack of resolutions that your outside counsel will need to be very much not on vacation to prepare.

Most startup charters require board approval to dissolve, and depending on your cap table structure, preferred shareholders may also need to consent.

Preferred shareholders have liquidation preferences, which means they get paid before common in any distribution of remaining assets. If there’s $200K left and your Series A liquidation preference is $3M, your preferred investors are getting a check (a very disappointing one) and your common shareholders are getting a lesson in how venture math works on the way out.

The tension in that room is visceral, yet also confusing and multi threaded. Investors who’ve written off the position may not prioritize the paperwork. Getting everyone to sign board consents and shareholder approvals when half the people involved have emotionally moved on is like trying to nail jello to a tree.

Not all shutdowns look the same. And the path you pick matters for personal liability reasons, timeline considerations, and how much you’re willing to pay to get it done right.

As the old saying goes, you can have it done fast, cheap, or right. Pick two.

The most founder-friendly option. You drive the process by notifying stakeholders, settling obligations, filing your final taxes, and dissolving the entity. It’s still a dozen parallel workstreams across legal, tax, HR, and finance. But you’re in control. And you can return whatever’s left to investors. The goal is to exit with your reputation more or less intact and without having to pull in anyone from the state or federal government to lend a hand.

Sounds like something from a white-collar crime podcast (it’s also a state run liquor store chain in Florida). And it’s actually a legit legal path. You assign all company assets to a third-party fiduciary who takes over liquidation and creditor payments. Once an ABC kicks in, you’re a spectator, which, honestly, some founders find oddly peaceful. The mess is now someone else’s problem. Just don’t expect to be consulted on people’s feelings.

Bankers and lawyers make a killing in these, as they typically charge between 5% and 10% of the value to be assigned.

Assignment for the Benefit of Creditors (ABC) is not a form of federal bankruptcy, but it is a state-run, out-of-court alternative to a formal liquidation bankruptcy like Chapter 7. The latter is federally governed. And it’s excruciatingly slow… way slower than an ABC. Because, courts.

Chapter 7 is most common for startups with no path to restructuring. Avoid it unless you have no choice.

I wrote a longer piece on bankruptcy here.

Here’s the part that surprises everyone: you need money to stop spending money.

You pay your people before you pay anyone else. Not just because it’s right (it is), but because failure to pay wages can pierce the corporate veil and make you personally liable. The company can die. Payroll and wages always follow you home.

Most cloud bills come in arrears. Shut down mid-month and you still owe for what you already used. AWS, GCP, etc. They’re all coming to the wake, and they all expect to be paid.

Someone has to prep the final tax docs, draft dissolution filings, handle compliance. These professionals do not accept equity.

Most founders assume they’re just stuck with whatever contracts are on the books. You’re often not.

SaaS vendors would rather recover something than chase a dissolved entity through collections. 70% of money now is better than potentially 0% of money later.

If you’ve got six months left on an annual contract, call them. Offer 2-3 months as a settlement. More often than you’d think, they’ll take it. Same goes for coworking spaces, agency retainers, and software tools with auto-renew clauses. Get it in writing, because a one-sentence email confirming early termination is worth more than a verbal handshake from a customer success rep who won’t be there when the next invoice hits.

You won’t get every vendor to play ball. But knocking out two or three material contracts early can meaningfully change your wind-down budget. You don’t know until you give it the old college try.

CFOs think in waterfalls, so here’s the one that matters at the end.

Wages and employee obligations come first, legally and morally. After that, secured creditors, meaning anyone with a lien like a venture debt lender. Then unsecured creditors: vendors, landlord, SaaS tools, the lawyer who’s been patient. Then, if there’s anything left, investors get their liquidation preferences paid out in order. Common shareholders, including founders, eat last.

For most seed and Series A shutdowns, the waterfall runs dry somewhere around unsecured creditors. Investors get a prorated return of pennies on the dollar if they’re lucky, and a K-1 showing a loss if they’re not.

The reason this matters operationally is you need to map your remaining cash against this stack before you start spending it on wind-down costs.

Wind-down costs are themselves unsecured obligations, so if you spend the last $80K on legal and accounting before paying out employee PTO, you’ve got a personal liability problem.

If your entity exists on January 1st of a new year (even for one day) you owe another full year of taxes. I messed this up by like 14 days when I shut down my company.

Delaware does not prorate. The IRS does not care that you pivoted three times. You still have to file a final return even if last quarter’s revenue was a perfectly round zippo.

Most wind-down guides stop at the obvious stuff. Here are a few things that tend to blindside even experienced operators:

Source: SimpleClosure / Ravix Group

Most shutdowns take 9–12 months from decision to final dissolution.

Offboarding customers and employees, final invoices, legal notices, board resolutions, shareholder consents, bank closures, contract cancellations, tax prep. It takes longer than it sounds. Founders consistently underestimate how long it takes to get written approvals from people who’ve already moved on and are three weeks into their next job. You’re the last pirate on a sinking ship.

Investors don’t fear failure. The math tells us that they expect it. What they don’t expect (or love) is silence.

How a founder handles a shutdown tells you more about them than how they handled the good years. Everyone gets lucky sometimes. Not everyone can wind down a company cleanly, communicate proactively with their cap table, pay their obligations, and walk away with their reputation intact. That’s actually hard. And it’s noticed.

The founders and CFOs who go dark (ghost their investors, let the entity linger, stop returning emails) have a harder time raising again.

Not to be overly ironic, but the shutdown is kind of like the start of the next pitch.

SimpleClosure’s data suggests 60–70% of founders using their platform are already working on their next company. And a lot of them go back to the same investors.

Clean up the camp site before you leave. It’s the last thing anyone remembers.

I almost never have founders on the pod. They tend to be heavy on fluff and light on tactical insights. But this one was a special exception, as Dori is uniquely qualified to explain a situation most CFOs and operators grapple with at least once in their careers - shutting down a company. We unpack:

Hoping if you have to shut down your company, you do it right

CJ