Ask HN: Dissolve it, or limp-along?

3 pointsccarter8410y ago3 comments

Long story short, I'm a very minority player in a small startup focused on the energy sector. For a variety of reasons it hasn't taken off. Now there is talk about shutting down. This leaves whatever equity I might've accumulated equivalent to Chuck-e-Cheese tokens. This is quite unfortunate, but part of the gamble we all take.

Personally I think the energy sector is both a calling (to fight climate change) and an amazing opportunity. I truly believe our ideas will still work someday. But we didn't have enough business experience (or perhaps, nerve) to get lift-off, and we're out of runway.

So enough second-guessing - here's the question: Do I let the company dissolve, lose my vested equity and a fair bit of pride... or do I see if we can pay the annual fees and taxes to limp along for another year while the principal goes and finds a proper day-job for a while.

Cheers

3 comments

3 comments · 2 top-level

pedalpete10y ago· 1 in thread

Sounds like you're burnt out and need a change. I wouldn't worry about the equity so much, as you've said, it has near 0 value.

You didn't state where you were incorporated, what your costs of incorporating, etc. were.

I've kept a Delaware C corp going for a few years because the cost of shutting down and starting again is more than the cost of the taxes, and I can use the structure for another business in the future. I guess it also depends on how complicated the corp structure you put together are.

Aside from the cost of maintaining the corp, if you're comfortable with keeping it, why dissolve?

ccarter84OP10y ago

Yea good points, Delaware indeed. Guess we can see what the accountant costs will be for a year or two under both scenarios. Thanks

brudgers10y ago

The belief in the energy sector, its opportunities and challenges is orthogonal to the economic value of equity in the current company. Normally, "principal" refers to people who have singularly or jointly a controlling interest of an enterprise. If that's the case, the decision to fold is their's. Leaving to get a day job is a tell.