Sometimes, the most dangerous thing you can do is ignore your gut. I learned this lesson the hard way at a cost of $200,000.

In startups, we often glorify bold bets and data-driven decisions. We praise founders and investors who trust the numbers and who push through uncertainty. I once lost $200,000 on a healthcare product. On paper, it looked solid. Some advisors told me to back it as the numbers felt promising. Deep down I was not convinced but I still went ahead with it.

This is the story of that decision, what went wrong and why that $200,000 loss turned out to be the most expensive and valuable education I have received in building my health tech company and in backing startups.

The Idea That Looked Perfect on Paper

The product was an online healthcare consultation platform designed to help people access doctors from the comfort of their homes. Telemedicine was booming that time. Everything pointed to demand. Digital health was no longer speculative as it was mainstream. Advisors assured me that the numbers made sense. But startups do not fail on ideas alone, they may fail on execution. And this is where the cracks began to show.

Despite its promising nature, things ended up not working out because:

Underestimated the compliance requirements:

Healthcare compliance regulations are the backbone of patient trust and data protection. Protected Health Information includes:

• Personal Identifiers: Name, address and other security numbers.
• Medical Information: Diagnoses, prescriptions, lab results.
• Financial Data: Insurance and billing records.
• Biometric Data: DNA, fingerprints.

Certifications, approvals, legal frameworks and regulatory systems were treated as hurdles rather than foundational pillars. As a result, the company failed to clear the needed certifications to operate.

In healthcare, you do not figure compliance out later, they are done at the initial stage. By the time they realized this, it was already too late.

A Gap in Operational Knowledge:

Great ideas do not compensate for weak operational understanding. The founding team lacked hands-on experience in healthcare operations. They understood the vision but lacked at many levels in onboarding, clinical governance and system reliability. I have seen many founders burning cash hoping that just a little more will fix the issue. But the thing you need to know is that it rarely does fix the problem.

Startups do not die from a lack of ambition. They mostly die due to the lack of operational depth.

Absence of Professional Processes:

As the company grew, it became evident that development and business processes were necessary. There was no disciplined approach to business planning and no professional frameworks for accountability. Decisions were not truly strategic.

Early-stage chaos is normal but unmanaged ones will become fatal.

Decision-Making Without Insight:

Perhaps the most damaging issue was the lack of structured decision-making. There were no reliable, real-time insights and no clarity on what was working and what was not. Without the right insights, the process turned into guesswork.

The Hardest Lesson: Knowing When to Cut the Cord

Sometimes, the strongest move is to know when to stop or when to walk away. Many founders and investors keep burning cash hoping that “just a little more time” will fix everything. But hope is not a strategy. Throwing more money at a broken foundation does not repair it but accelerates the fall.

For a long time, I saw that $200,000 as a loss. Now, I see it differently. It taught me that speed of learning matters more than being right at the first time.

In startups, survival is not about perfection. It’s about learning faster.

Trusting Your Gut

There is a misconception that trusting your gut means ignoring data and evidence. That is not true. Your gut is not just an emotion, it has the ability of recognition which has been built from experience and observation. Your mind processes information which you haven’t fully understood yet.

When your gut says something feels off, it is usually responding to inconsistencies and unclear answers. Data tells you what is happening, but your gut often tells you why it would not work. But the thing to be noted is that ignoring either data and gut is dangerous.

Losses Are Part of the Game, but Learning Is the Return

If you are building or backing startups, losses are inevitable. You will place bets that might flop. That is the cost of building. What defines us is not whether we lose but how we respond to it. Do we cling to sunk costs and sink deeper? Or do we step back, extract the lesson and move smarter next time?

For me, that $200,000 loss was a tuition fee for learning better decision-making. Today, I ask harder questions and listen more closely. Most importantly, I respect my instincts or gut feelings.

Have you ever ignored your gut instinct and paid the price? If you have, you are not alone. And if you have not yet, this is a reminder to pause the next time when something does not feel right.