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A cautionary tale of what this can lead to:

My brother's startup wasn't bring in much money and there was always the near promise it would. He went through all his savings and retirement funds and went close to $100k into CC debt. This was a swing of +$1m to -$70k. Yes, he had a problem (unacknowledged, btw) that was more dire than yours. Just be aware that this stuff can get out of control, if you let it.

After getting to the -$70k state, he asked me and my parents for money to continue. We all refused because we knew that our money would be like the $1m+ he had already gone through. We told him to get a job. He refused. He couch surfed for a while. After 6+ months doing that he realized, because his family had abandoned him, he would have to get a job. He did ($155k/yr). He started a month ago. He's angry at the family and won't talk with us now. Ironically, he admitted that he wouldn't have the job now, which he needs, if we had given him money last year. However, that doesn't matter. He still maintains he did the right thing and we didn't support him.

It's been a sad year for my parents and me. Actually, sad few years, since we all saw this coming (and tried to prevent it, but he only got angry at us for being "negative").

It was personally hard for me to let him go right to the brink of being on the street. I did it because giving him money would have drained my resources, and for no reason. His reality distortion field was so strong, he would not listen to anyone.



> This was a swing of +$1m to -$70k.

The crazy thing is that at a 3% withdrawal rate $1m would have been $30k a year for personal expenses for the rest of your brother's life.


Don't forget the 10% penalties on the retirement part. My guess is it was more than half of the $1m.


Yikes. I hope the wounds heal over time. What you all did sounds right. It seems like your brother had a problem and giving him more money would have exacerbated it.

Hang in there, I'm sorry you all had to go through this.


The AirBnB founders also maxed out multiple credit cards.

https://medium.com/cs183c-blitzscaling-class-collection/scal...

"Joe and I both had ~$30K in credit card debt and this is what we were using to fund the company."


I always see comments like this when people bring up failure stories. I get wanting to be positive, but surely at a certain point you're deluding yourself?

There is no comprehensive stats on this, but the big question is, of the people who went in to serious CC debt, how many of them became massive unicorn companies, or at least mildly successful?


Sometimes risky behavior pays off. Good for them.


Exceptions, not the rule IMO. Also stated (maybe further down) the solution had a protracted sales cycle leading to long turnaround.

CC debt is probably a poor indicator of the quality of an idea.


Sorry to hear this. I love my Brother to death, and I can't imagine going through what you went through with yours.

I hope things will get better.


Just out of curiosity, what was the idea behind his startup? I've been avoiding getting a job along the same lines, but can never imagine going into 100k debt for a startup obsession.


I don't want to say too much, because I don't want him to find this, but it was a web service for a popular non-profit. It helped them manage costs of a certain nature. It was definitely a good idea, but the non-profit is notoriously stingy, and the sales cycle was very, very long. So far they've only sold one copy. I think the obsession he had scared off some investors, but mainly I think they didn't see a big exit. He had a partner, but the partner got a job years ago, because he had a wife and kids he needed to feed.




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