If you don’t think that it is financially viable to keep running your business, it’s important to consider all of your options. The first one you think of may be bankruptcy, such as using Chapter 11 or Chapter 13 to restructure or reorganize your finances to keep the business afloat. It is possible, in many cases, to use bankruptcy as a way to keep a business functioning by improving the way its debts are organized and how it operates.
Another option, however, may be to sell the company. Perhaps you haven’t been able to make ends meet due to demands in your personal life, but you still think that the business idea itself is credible. It can find success. The company just needs someone else to run it so that they can put in the time and effort needed to achieve that success.
If you can sell someone else on that vision, a sale may be possible. Another option may be a merger, in which you may even continue working for the company as it merges with a larger competitor.
Typically, business owners will look for buyers to see if they have an alternative to shutting the company down. This can preserve the jobs that their employees have. They may then look into bankruptcy if a sale is not possible. While Chapter 11 may help them restructure and stay open, they can use Chapter 7 and liquidation as a sort of last resort to eliminate their debt.
These cases can get quite complex and there are many options. Make sure you are well aware of what ones you have.