Good point, but there are flavors of fail. There is the 'you reached to high and fell off the ladder' flavors which are generally seen as a good thing, and then there is the 'selling bungee harnesses to teenagers' flavor where people say "What exactly were you thinking would happen?"
I tried to help Ed Patterman build a Golf magazine on the web in '95 it failed because it was too early. Sony tried to create an e-reader where they charged money to put out of copyright works in PDF on to it for you to read. It failed because it was a stupid idea.
> People also get tarred with one unsuccessful project.
Kevin Rose himself would be a counterexample. If he was responsible for Digg's rise, he is also responsible for it losing its audience and relevance.
This doesn't actually seem to be the case. The startup space is littered with ex-CEO's who can still raise capital. These folks are seen as battle hardened. I think all of the Color guys are going to end up fine despite that debacle.