Winning a "best app" award is great, but it won't help you meet payroll.
More than 30 U.S. startups have had to close their doors in 2015, CB Insights reports. Some of the companies that called it quits had raised capital from high-profile investors. Others had collected accolades like being named to Apple's annual list of the best apps of the year.
Here are three superstar startups that have shut down this year, plus explanations about what went wrong from their founders.
Virtual-assistant company Zirtual surprised customers and all of its 400 employees last week by announcing it was "pausing all operations." Founded in 2011, the Las Vegas-based company connected executives with remote assistants over the Internet to help with tasks like scheduling and making travel arrangements. Investors including Zappos CEO Tony Hsieh invested a total of $5.5 million in the company.
What happened: Zirtual co-founder Maren Kate Donovan declined to comment, but told Fortune the company needed additional capital to meet two upcoming payroll cycles, and couldn't raise the money. Startup investor Startups.co acquired Zirtual a day after it shut down, but it's unclear how or when a reorganized version of the company will resume operations.
The lesson for entrepreneurs: Don't let your burn rate affect your ability to meet payroll.
2. Circa News.
In June, news app and website Circa went on an "indefinite hiatus," co-founder Matt Galligan wrote in a blog post. The company launched in New York and San Francisco in 2011 to provide news in a format tailored specifically for mobile devices. Circa raised $4 million in venture capital funding and was named one of the best new apps of the year in 2013 by both Apple and Google.
What happened: Circa didn't develop its revenue model fast enough. "Our ongoing plan was to monetize Circa News through the building of a strategy we had spent a long time developing, but unfortunately we were unable to close a significant investment prior to becoming resource constrained," Galligan wrote in a blog post.
The lesson for entrepreneurs: Don't let making money be an afterthought.
Anonymous social networking app Secret halted operations in April just 16 months after launching. The San Francisco-based company let its 15 million users share personal details without revealing their identity. Secret had raised $35 million from groups including Google Ventures and Kleiner Perkins Caufield & Byers.
What happened: Secret co-founder David Byttow wrote in a blog post that the startup had drifted from the vision he had when he started the company. Like similar anonymous social media apps Yik Yak and Whisper, Secret ran into problems related to bullying and gossip. Byttow said the company would return money to investors and cut its losses. "I believe in failing fast in order to go on and make only new and different mistakes," Byttow wrote.
The lesson for entrepreneurs: Fast growth can sink your startup--particularly after it takes on a life of its own.