How to Announce Company Closure [With Templates & Samples!]
Startups facing closure have a crucial responsibility to effectively communicate their shutdown to stakeholders and the public. This step is essential for several reasons.
Primarily, it allows employees adequate time to seek new employment opportunities. Additionally, it's important to inform your customers, many of whom may wish to make final purchases or seek alternatives.
Navigating a startup dissolution can be challenging, particularly in finding the appropriate words. This blog aims to guide you in crafting a considerate and impactful closure announcement. You'll learn how to convey the necessary information about your startup's shutdown, mitigate the impact on your employees, and conclude your business journey on a hopeful and positive note.
Key Takeaways:
Only announce your decision to shut down once the move is finalized and agreed upon by all founders and the board.
Utilize visual elements like images and videos effectively on platforms like Facebook and LinkedIn to communicate your message in a more engaging and empathetic manner.
Maintain a concise and professional tone, particularly on platforms like LinkedIn, to convey your message with the gravity and respect it deserves.
Business Closing Announcement for Startups – The Basics
Understand the ‘Why’
Announcing company closure is much more than informing stakeholders about the fate of your startup. It can also set the stage for future endeavors. For example, you might be planning new projects that you want to share with your readers. Or, you could include a call to action inviting collaboration with people who you’ve had success with in the past. These points – and possibly more – will help you determine the content and tone of your message.
Empathize and Be Respectful
Your startup’s about to go under, and many people will lose their jobs. It’s a tough time all around. Try to show support and concern for others in such circumstances. By maintaining a respectful tone, you can show your startups ‘human’ side,’ which ultimately helps soften the blow.
Clarity and Transparency are Crucial
There’s no use of beating around the bush – convey the news and be as clear and transparent as possible. To do that, avoid using vague statements or jargon, as that only builds suspicion amongst your employees.
Don’t Play the Blame Game
Your message should reflect a sense of maturity and professionalism. Blaming others, whether it's certain employees, your competitors, or external factors, is not ideal. If you own the situation and claim part of the responsibility, people will usually respect you more.
Be Yourself
Although we'll share closure announcement templates later in this blog, they're more for inspiration than imitation. That's because people connect with authenticity, not corporate speak. Try to craft and shape the message in your company's 'voice' by conveying your genuine feelings and what the journey has meant for you and your co-founders.
Anticipate What’s to Come
Having known your employees for X amount of time, you should anticipate their responses, questions, and concerns. This lets you prepare the right answers and helps you develop ideas for providing support post-announcement.
What’s the Right Time to Announce Company Closure?
The right time to announce company closure is after all key stakeholders have agreed to end the company. This also entails meeting all of a company's legal and financial obligations, and the initial shutdown preparations have begun. Once you've reached this stage, convey the news to your employees and customers via relevant channels.
How to Announce Company Closure on Social Media
We’ve touched on the basics of crafting the right business closure announcement message. How you say things is equally important to what you want to convey. In this section, we’ll get more specific and show how a startup business’ closure announcement sample looks across different social media platforms.
Announcing Startup Business Closure on LinkedIn
LinkedIn is a professional and business-oriented platform, so your tone should be respectful and formal and focus mainly on how the shutdown will affect all employees. Use precise language that accurately describes the gravity of the situation while sharing possible future opportunities for the employees.
Because LinkedIn generally consists of professionals, colleagues, and industry folk, you should avoid being too casual. That said, here’s an example of how a closure announcement could look like on LinkedIn.
[Company name] has officially come to an end.
I have some difficult news to share as we approach the end of [month/quarter/year]. After much consideration, we have decided to close down [company name]. This journey has been one of immense learning and growth, but despite our best efforts, there was no other way forward.
The path of entrepreneurship is often unpredictable, and while we've had many wins, we've also faced tough challenges that led us to where we are now.
I want to take this moment to thank every team member, partner, and customer who has been part of our story. Your support and engagement have meant the world to us.
We are dedicated to ensuring a smooth transition for our employees and customers in the coming weeks. For any inquiries or further discussion, please feel free to contact me directly.
Thank you for being part of our journey. I wish you all the best going forward.
Here’s an alternative template:
As the year draws to a close, we've made the challenging decision to shut down operations. In other words, our company did not perform as we expected.
Yet, in every setback, there's something to learn. Failure is often the toughest teacher, but each lesson brings us closer to success.
My/Our biggest mistake was [mention what went wrong].
As we the company closure process startups to pick up, I would like to extend my deepest gratitude to my colleagues, coworkers, and investors who placed their trust in me [and cofounders if present].
It was an incredible experience, one I shall never forget. If you have any questions or queries related to the days ahead, you know where to find me.
Announcing Startup Business Closure on Facebook
Facebook usually has a broader audience than LinkedIn and often includes customers, friends, and family as part of your friends list. As such, you can make your message more heartfelt, personalized, and casual.
Here, your message can be more narrative-driven and include:
Personal stories.
The challenges you collectively overcame.
The emotions involved at each stage.
Also, feel free to share images and visuals, especially at the end of the message. Here’s a sample:
To the [company name] Community,
It's with a heavy heart that we share [company name] will be closing at the end of this [time]. It’s been an incredible ride, with moments of joy, excitement, seemingly insurmountable odds, and invaluable learning.
To our customers and supporters: Thank you. Your belief and trust in us have been the driving force behind our every step. We're committed to ensuring a smooth transition for any ongoing needs.
To our dedicated team: Your passion and hard work have been the core of our journey. We're grateful beyond words for every moment.
While this chapter ends, the bonds and memories we've created endure. I’d love it if you could share your favorite moments and stories with us as we close this amazing chapter of our lives.
I’m eternally grateful to anyone and everyone that was involved. I wish my team, investors, and customers all the best.
Here’s to an amazing future.
[Try to insert a visual image of the team, the company's journey, or a graphic representing gratitude and farewell, maybe a message saying thank you to your customers. A video also works]
Your Startup Business Closure Email to Employees
Give extra thought to how you plan to inform your employees about the imminent closure. Make it clear that the shutdown was unavoidable and that you will do everything possible to make the transition to their next workplace as smooth as possible.
The following is a sample you can use to craft a company shutdown announcement email:
Email Subject Line: Important Company Update: Closure and Next Steps
Hello everyone,
I’ve been tasked with conveying the unfortunate news that [company name] will cease operations, effective [date]. This decision brings inevitable layoffs, and I want to acknowledge the personal impact this may have on each of you.
Here's What's Happening:
Layoff Details: [Mention the specifics, including dates and processes]
Resources for Transition: We're committed to providing resources to support you through this transition. This includes [details on severance packages, outplacement services, or other resources].
Support Meetings: We will hold meetings to discuss the shutdown, how we can help, and address any and all questions.
Your hard work, dedication, and resilience have not gone unnoticed. The decision to close is primarily a consequence of external challenges, not the value you've brought to our company and mission.
We understand this is a lot to process, and we want to ensure you have the support and resources needed during this time. Please join us for a detailed discussion on [date/time], and feel free to reach out directly with any immediate concerns.
Thank you for your commitment and contribution to [company name]. It has been a privilege to work alongside you.
Sincerely,
[Your full name] [Your position within the company]
Note: Here’s an in-depth guide showing how to properly manage employee severance and layoffs.
Your Startup Business Closure Letter to the Government
Unlike the previous two, there’s no ‘standard template’ or sample for informing different government entities about your company shutdown. Also, who you inform and in what way differs based on the state in which your company operates and how it’s structured.
The following are general notifications required by all startups about to shut down:
Secretary of State: File a formal dissolution with the state in which your startup is incorporated.
Internal Revenue Service (IRS): Notify the IRS with a final tax return and mention that it's the final submission for your startup. Cancel your EIN and settle all outstanding taxes.
Department of Labor: Inform the state labor department of your closure and any layoffs, adhering to the WARN Act if applicable for larger employee counts.
Conclusion - What’s Next?
That wraps up all the different ways you can and should announce your startup’s closure to the world. The guidelines shared in this blog should help you announce your shutdown properly. Now, all that’s left is to take care of your legal and financial obligations.
In that regard, you have two options. The first option is paying attorneys and accountants to shut down your company, a process that potentially involves spending tens of thousands of dollars and waiting for months (and in some cases, even years) for your startup to completely shut down.
The second option involves shutting down your startup much faster, for considerably less, and with fewer back and forths – all in a legally sound way.
SimpleClosure can help. All that’s needed from your end is to reach out, provide a few details, and continue doing your thing while we take care of the rest.
Interested? Let’s get in touch.