At an Atlantic Institute for Market Studies symposium in February, Clearwater Seafoods president John Risley remarked, almost as an aside, that there was virtually no downside in a young person trying to start a business.

His rationale for such a statement is now in evidence throughout the startup community in Atlantic Canada.

“If it doesn’t work out, you’ll be a much better employee for someone than if you hadn’t had that experience,” Risley said. “But if it does work out, of course, that’s great.”

The hard truth is that businesses usually don’t work out — as has been witnessed in the startup segment this year. Origin Biomed of Halifax and Techlink Entertainment of Sydney, two ventures that government invested in heavily, have both faltered. Gillian McCrae shut down GetGifted of Charlottetown. There have been others.

We’ve counted 46 startups that “failed” in Atlantic Canada in 2014. That’s about 16 per cent of the companies we were following in 2013.

That sounds like a lot, but there’s one or two mitigating factor. Seventeen of those failures, or about 38 per cent of the total, were companies founded in 2013. You could argue that these were companies that never really got off the ground. But for the better part of a year, people were working on these projects so we slotted them into our failure bucket.

Second, the job losses were contained, as 26 of the startups had never had any paid employees. Three companies that failed in 2014 employed more than 10 people. In total, at their peak, these 46 companies employed a total of 101 people.

I’ve spent a fair amount of time lately speaking with startup founders who have had to make that difficult decision to stop operations. I wanted to know why they failed, and it’s difficult to develop themes. In a lot of cases, there was simply no market for the product, or no way to make money out of providing the product.

Beyond that, there’s no common theme. Some companies underestimated production costs, or the cost of acquiring companies. Some had divergent ambitions among the management team. Like Tolstoy’s observation of miserable families, each was unhappy in its own way.

One response I have NOT heard a lot of is that there was no capital available to perpetuate the company. One or two reported a cash crisis after their Scientific Research & Experimental Development tax credits were denied. But several companies had cash in the bank when they shut down. They simply didn’t see a way forward for the company and decided to return the remaining cash to their investors.

The founders and employees were distraught by the failures, but those I’ve spoken with have moved on quickly. I haven’t been able to track employees of companies with more than 10 employees, but those from the smaller failed companies seem to have found work, many with other startups.

Even the founders of the companies are moving into other companies. Joe Menchefski of Sydney had a well-publicized closure of Billdidit last year. Menchefski is now working with Sona Nanotech, which produces non-toxic gold nanoparticles. He’s raised enough private capital to fund the company for a few years.

And Gillian McCrae of GetGifted recently spoke at the Startup Newfoundland and Labrador Startup soiree in St. John’s. She highlighted the ethical imperative of being frank with investors when closing down a business.

“For the investors, it’s important that whatever you commit to, you do it diligently,” McCrae said. “I still have a positive relationship with my investors. They were really amazing.”