If you keep customer data after payment period, you're losing money.
So scream test will cost you money.
They decided that this cost is not appropriate payment to compensate for possible reputation loss.
Whether that's a good business decision or not, time will tell.
It takes years to build a good reputation and minutes to destroy it.
"We did our best - we sent 2 emails". I wonder how shitty the product was when sending few emails is their best.
The guy either sounds like a full fleged VC psychopath, or someone very unexperienced.
It sounds like they did turn the system off for paying customers though, why would it be any worse to do a scream test a few days before they pulled the rug out?
If it's just a matter of billing cycles (does everyone's billing cycle end on the same day?) , it seems like they could've handled it better. Just give impacted users a prorated and shortened final month (or even given it out for free for goodwill)
https://www.v-wiki.net/scream-test-meaning/
Basically, you just turn stuff off, and make people scream, while they can turn it back on. You could have did this a month ago, as a critical warning of impending termination of systems.
You didn't do that.
Instead, you sent a few emails, which itself isn't even a guaranteed delivery. Again, as a CTO, you should know that email is not a guaranteed deliverable.