Maybe I should've been more explicit since on here it's reasonable to think of 'tech startup' when one mentions 'business', but I meant in all sorts of businesses - actually the tech scene is very small here, and even then it's mostly IT services or web development (i.e., mo product development); I don't know anyone who had a failed business in that field and was seriously affected by it.
When you start for example a plumbing company or whatever and you buy 25k worth of tools and a lease contract on a van, and it fails and you need to take a job afterwards, on a employee plumber's salary that 25k is huge, enough to make your and your families life miserable.
I agree that for tech companies, the situation is usually not as precarious - if you have the skills to start a company like this, or even if you don't but almost do, you can get a fairly well-paying job and not be as affected. In those cases you would presumably get proper legal and accounting advise and shield personal money from the business liabilities but many businesses start as sole proprietorships and are very vulnerable to even small setbacks.
When you start for example a plumbing company or whatever and you buy 25k worth of tools and a lease contract on a van, and it fails and you need to take a job afterwards, on a employee plumber's salary that 25k is huge, enough to make your and your families life miserable.
I agree that for tech companies, the situation is usually not as precarious - if you have the skills to start a company like this, or even if you don't but almost do, you can get a fairly well-paying job and not be as affected. In those cases you would presumably get proper legal and accounting advise and shield personal money from the business liabilities but many businesses start as sole proprietorships and are very vulnerable to even small setbacks.