At what point do I give up and give my investors their money ($1.7m or so) back? If so, will I be punished? I will not promote

Hey guys, I have recently been given $1.7m as a pre-seed to start a company by various angels and VCs My co founder and I started this company based on a problem we noticed after speaking to dozens of people in the space. We have left our jobs to pursue this however, we spent the last 8 months trying to commercialise our solution and it’s been really tough and traction has been disappointing. In other words, we have not found a strong product-market fit (PMF). My cofounder and I are deeply frustrated by thi