When to stop, and why that’s a win

Very few people get on a stage to talk about quitting.

We give talks about grit. About the founder who heard “no” forty times and then closed that funding round. About the maxed credit cards, the re-mortgaged house, the sold car to make payroll… and it all worked out! (except… it usually doesn’t).  

We celebrate the sheer will of founders to snatch victory from the jaws of defeat.

Startup founders absolutely require an unreasonable amount of persistence. But when that’s what gets all the airtime, we fail to train founders to recognize when something is really dead or dying. 

So let’s talk about that for a bit.

First up: an important distinction. I am speaking to founders who are doing the right things: talking to customers consistently, testing assumptions, gaining a deep understanding of the market.

Some founders can’t recognize the reality facing them because they have never gone looking. A year of building; no hard customer conversations; no idea what would prove their thesis wrong. If that at all sounds like you, you do not have a “stopping decision” to make. You have your head in the sand. Go talk to customers – especially the ones who owe you nothing – and come back to this later. 

This is for the founder who really went looking. Who ran interviews, shipped and measured, and was honest with themselves (and their teams; their supporters) when they didn’t like what the data said.

The problem of permission

Founders close to the end almost never come to me missing information. They have the churn numbers. A pipeline that will not close. They can tell me exactly what the market has been saying for six months. Sometimes the evidence is silence: outreach that simply will not turn into leads is not an absence of data, it is the data. 

Often, founders facing a decision to stop are not missing evidence. They’re missing permission.

You find yourself with data that clearly does not look good, and now your issue is everything you’ve rallied around the idea. You told people. Somebody left a good job to join. Somebody wrote a cheque. You stood up at an event and described where this was going, and people clapped. Stopping is socially, and often financially, painful.

So founders stay in things a year too long. 

But waiting does not make those painful decisions and conversations go away, it simply schedules them for the future. A future in which you probably have less money, less energy, and less goodwill than you have today. 

So let’s start saying it plainly: stopping, when the market has clearly told you to stop, is the correct way to do the job. And it should be celebrated.

Your job was never to make one specific idea work no matter what. It was to find something that works. A founder who hears the market and acts on it is succeeding at the actual assignment.

Pivots vs. Quitting

Stopping can look like a few different things, depending on precisely the market is saying “no” to. 

1. Changing the solution. Same problem, different answer. Most market “nos” are asking for exactly this and nothing more. Version one was a hypothesis. Kill it and pivot.
2. Changing the problem. A deeper pivot. You keep the team, their skills, and everything you now know about the customer, and aim it all at a stickier, more painful problem that the market will gladly pay to solve.
3. Winding down. This is the quit. Rarer, harder, and sometimes exactly right.

In reality, most clear market “nos” are an instruction to redeploy, not to disappear. Winding down only becomes the answer when you are out of ideas, resources, or bandwidth to aim with.

Pot committed

Poker players have a name for the trap that keeps founders in too long. A player is “pot committed” when they have put so many chips in the middle that folding feels unbearable, so they call with a hand they know will lose. Every serious player will tell you this is a leak. The chips in the pot stopped being yours the moment you bet them. The only question that matters is whether the next call is a good one.

Startups run on the same math, with higher stakes. The more a founder has put in – the years, the savings, the identity – the less likely they are to pivot or walk away. Which is exactly backwards. What you have already spent is spent, whichever way you decide. It is a terrible reason to persevere. The size of the pot says nothing about the strength of your hand.

Two honest questions

What would you tell another founder? If someone sat down with your exact numbers and asked your opinion, what would you say? Founders tend to be clear-eyed about every company but their own. Whatever you would tell them is what you already believe about yourself.

Would you start it today? Knowing everything you now know, with all your skill and none of the sunk cost, would you choose to start this afternoon? This is how you check whether you are calling because the hand is good, or because of what is already in the pot.

That said, a caution: every good company, and every good founder, goes through a stretch that feels exactly like failing. I’m not talking about making a decision to stop based on how you’re feeling – that’s up to you. The stopping decisions I’m talking about are about whether you can point at evidence outside your own head. “This is brutal, and here are three metrics moving” is a different position from “this is brutal, but I believe.” Only the first one is information.

You are not going back to zero

The way we talk about startup success creates a stigma that treats stopping as erasure. As if two years of building skills, knowledge, experience, and market intelligence get deleted. The opposite is true. The idea is the only thing you lose. Everything you learned, you keep.

You keep the domain knowledge, which is now genuinely rare: you know precisely why the obvious solution fails, and almost nobody else on earth does. You keep every customer conversation – and the people who told you “no” are often the best first calls next time. You keep the judgement that only comes from shipping, selling and running out of runway. The team, honestly, you often lose, especially in a wind-down. But you keep the knowledge of exactly who you would build with again, and if you close well, that door stays open.

That learning is not a consolation prize. It is the asset. And it is the entire reason a pivot can work.

The first idea was tuition. What it bought is what you build with next.

‍Ed Martin is the President & CEO of Genesis, a tech startup incubator in St. John’s, Newfoundland. He previously co-founded Clockwork Fox Studios (Zorbit’s Math Adventure), a venture-backed edtech company that was acquired in 2021. Learn more about what we do.