What happens if you have less than 3 months of cash? The most important action to take when facing such difficulties is to payoff obligations and end your business.
The point of no return in many cases is having cash for only less than two months. In this case it is necessary to layoff your employees and payoff your obligations and spend remaining cash in closing your company. It may get worse if you don't do that and face an empty bank account with unpaid payrolls and unpaid obligations instead,
Things to consider in this stage:
- Shut your business in case of point of no return.
- Payoff your debts, payrolls and obligations.
- You may face personal debt in worse cases. Consult on how to shut down your company.
- Behave on a way you are proud of.
Get advice and support wherever you can. Consultants can better help you in this cases. Often the most difficult thing for founders in this point is accepting failure.
Finally, remember two things:
- Don't lie to yourself
- Act quickly and decisively