If you're looking at past examples, they'll all be successful because the ones that ran out of money and still failed are on the streets panhandling $10/hour.<p>Maybe people fail at even higher rates when they tunnel onto their currently unsuccessful projects, but the advice appears good because instead of writing a post-mortem that everyone can read the failures are hunting for copper wiring in people's empty vacation houses.<p>Baye's Theorem: P(successful | desperate) * P(desperate) = P(desperate | successful) * P(successful)<p>There's a LOT of desperate people on the streets, and not many rich millionaires. 21% of millionaires inherited their money, upper-bounding P(desperate | successful), so P(successful | desperate) seems like a really low number.<p>Also, this advice would imply you should give away most of your life savings to someone to create a panic'd deadline. Maybe hit up a casino so you have a 50% chance of getting rich gambling, and a 50% chance of losing and getting more motivation for your startup to be successful.
Just to provide an anecdote: I sunk probably around 20k into a startup over the course of a couple years. The startup went absolutely nowhere however I learned <i>a ton</i>. Not only technically but about myself and time management.<p>That 20k turned into a new job, which I would not have been able to get otherwise, that greatly exceeded the money I spent failing.<p>Sometimes success is not exactly what you could have imagined.
The most important caveat is that the side project already generated revenue when the author still had a full time job.<p>Trying to turn a project with 0 revenue into something, while having no fixed income is most likely going to fail, and ruin you in all sorts of ways.
This resonates with the KLF's "The Manual: How To Have A Number 1 The Easy Way" [1]:
"Firstly, you must be skint and on the dole. Anybody with a proper job or tied up with full time education will not have the time to devote to see it through... Being on the dole gives you a clearer perspective on how much of society is run... having no money sharpens the wits. Forces you never to make the wrong decision. There is no safety net to catch you when you fall."<p>Personally though, I wouldn't and couldn't take a stance.<p><a href="https://archive.org/details/TheManualHowToHaveANumber1TheEasyWay" rel="nofollow">https://archive.org/details/TheManualHowToHaveANumber1TheEas...</a>
Desperation might build motivation, but it will also ensure short-term thinking (needing to pay one's bills and feed one's family tends to do that). The most successful companies adopt a longer view, and this might be far easier without the immediacy of insolvency looming.
I believe it, for some definition of success, if you're already proven that people will pay for your product by the time you run out of money. Having a bunch of extra time to work on a side-project probably helps more than running out of money though.
This is painful to read for failed founders. There is very real survivorship bias applied here. Of course motivation and frugality play a part to success though