Shut down my $100k ARR startup last month. Here's what actually went wrong.
Early last year I left my job as Head of Engineering at a stock advisory startup (scaled to 5Mn users) where I was employee #1 to go build an AI mobile app builder. Had offers paying more than I'd ever made but I turned them down because this felt like the right moment. AI plus my background building complex systems, felt like I could actually productize something hard.
And the product actually worked. Full mobile app development, app store deployments, monetization, custom backend orchestration for every app, invisible context trimming pipeline that handled 10,000+ messages in a single thread, cache deviation and protection, nested agentic collaboration. If you've worked with LLMs seriously you know some of this stuff is way harder than it sounds.
People were upgrading themselves from the lowest tier to the top tier at $200/month without us doing anything within 2 days on an average. That part felt amazing. Early retention for top tier subscribers was 75%. People shipped nearly 100 mobile apps on their own using the platform with 0 technical knowledge and within a month of starting.
The problem was I hadn't raised money and every message a user sent was costing me more than I made from it. I was personally putting money in to keep things running while we talked to top tier VCs. We got really far with one of them. Like ready to write the check far. Then they backed out at the last second. That one broke me a little bit honestly. I'd been stupid enough to not have a real pipeline behind them (I was raising money for the first time) and after that rejection something shifted. My energy in pitch meetings was off. I was in a spiral with no time off to recover and every rejection kept getting more personal. I kept getting calls, kept making it to round 2 and 3, but then always a rejection for some reason. Meanwhile every competitor was raising and getting stronger while we got weaker.
Around November growth just stopped. We raised prices to survive which obviously made growth worse. Kind of a spiral at that point. Still tried a few things to stay afloat, but personally and financially, I was draining myself. So last month, I finally shut it down.
It's been a rough six months. I'm taking some time off now. No plans to jump into anything full time, just decompressing and talking to other founders. Helped a friend who just closed their Series A work through some messy architecture stuff last week and honestly it felt better than anything I'd done in months. Forgot how much I like solving other people's problems when the stakes aren't mine. If you're building something and want to think through hard technical problems with someone who's been deep in AI infra, fintech happy to chat.