Your advice is way too binary. Cash flow crunches happen all the time in bootstrapped startups. First thing is to cut costs because you can do that quickly.

1.) Cut/defer all discretionary costs.

2.) Founder salaries go to zero. They signed up for it.

3.) Defer sales commissions, e.g., don't pay until the company gets paid.

4.) Defer payments to vendors. If it's 15 days net pay in 60. Our customers do this all the time.

5.) Last of all lay off staff. If you can avoid this step it makes your bounce-back way faster.

Do all of this before you need to.

At the same time go after your marketing strategy. Downturns like what we are seeing now also represent opportunities for companies that can reposition to save users costs. Payoff for this will be longer term.

Finally...It's a bit late to point this out, but it's dumb not to setup a credit line when times are good so you can get through cash flow crunches. I would shoot for something that gives you 6 months runway if you can get it.

> 4.) Defer payments to vendors. If it's 15 days net pay in 60. Our customers do this all the time.

Not good advice if you think the crunch may last more than 60 days.

It's part of 'flattening the curve'. In 60 days your overall burn can be lower due to other factors, so you can add the payments back in.

Be sure to annualize your effective interest rate.

My man, a lot of these things are symptoms of zombie startups. Maybe once in a while a legit business has to do these things to survive, but most of the time the businesses doing these things are zombies. They’ll never succeed, but they will also never “fail”.

No. You can always raise more cash or dig your way out. Yes your odds of success lower as your runway dwindles, but it's definitely not game over. I sold my company two years after running out of cash.

You can become a zombie startup, but that's usually a function of poor leadership.

Zombie is perfect, this is so true