[UkrainianJew]

Talking about cruelty, people can understand you if they can relate to you and think "shit, this is tough, I would have to do the same in their place".

You probably don't want to give away the exact financials (runway/funding/expenses/customer numbers), but you can still be specific without that. Like "We hired you because we wanted to deliver X in Y months. We took the risk to be the first on the market, but it didn't work out. With the departure of the XYZ customer, we simply don't have enough cash to keep paying the salaries.". Make sure it reads more as a personal email than a soulless press-release with "given the worrying situation", "on our journey" and other BS phrases.

Bear in mind that people will inevitably question "why I got laid off why John from team B did not". If you want to reduce this stress, find a good formal explanation (like we are forced to close feature X because we lost customer Y, and hence are laying off the folks that worked on it).

Otherwise, good references, decent severance. Canceling some externally observable verifiable bonus for yourself could somewhat reduce the tension. You could forfeit that annual board meeting in Hawaii, but buy a hell lot of goodwill from people that worked with you (and that will still be in your network) by being public about that. It could pay off nicely some years from now.