Handling lack of motivation and communication in early-stage startup

I think the most charitable interpretation is that they're having some kind of mental health issue. You could tell them that if they're currently unable to work for unrevealed personal reasons then they have to be considered on sick leave. That means that after some reasonable grace period they have to supply documentation. At that point, you'll either know more about what the underling issue is, or have very solid grounds for firing them.

I think firing them now is also a reasonable decision to make (but perhaps a little on the harsh side, depending on the time frame).

Please do document all this and make sure you are following good HR practice. You need to say clearly and put it in writing that what is required in the job is not being done. You can offer help and support but the underlying relationship is that of an employer. Have action steps - both agree they will see a doctor or mental health professional and make sure they actually did that. If they don’t - document it and offer to help but make it clear they are not doing their part and that will impact their employment status. I know this can sound over the top but being supper clear that this is impacting employment is really important. It is very easy for a “friend” employee to miss this aspect and feel blindsided when separation from employment happens. It can lead to bitterness and possible lawsuits. It takes time and hard conversations to move through something like this but it is far less drama and distraction than a lawsuit.