I am planning to quit my current job and do a tech startup. How should I invest my savings of ~$210K? Assume that a fixed amount X = $2000 gets withdrawn per month and the aim is to maximize the amount that would remain at the end of K=4 years.
I'd say your first task is to divide your savings into near term (living expenses, emergency fund, major purchases) and long term (retirement).
Your 2000/month is near term. For sure add some emergency money to that.
I'd put all that near term in cash. Maybe you could put only 1 year expenses in cash and use short term bonds and CDs to try for a bit more yield on years 2-4. But basically cash or very close to cash. (At present, safe short term investments all have crappy yields. Anything with a good yield probably isn't safe enough. Not true always, but true at the moment.)
Then standard asset allocation advice applies to the retirement funds. There are many discussions of that on here and elsewhere.
I wonder if maximizing your year 4 amount is the right goal. Few risky assets, certainly not stocks, do anything predictable on a 4-year horizon. So to me you might want to maximize your chances you won't have to touch long term assets at a bad time, by keeping enough in cash, and then maximize your long term assets over the long term (20 years not 4).
I mention my "just use a balanced fund" writeup on a lot of allocation questions; I did write it specifically thinking of people who might do tech startups, so here it is again: http://blog.ometer.com/2010/11/10/take-risks-in-life-for-savings-choose-a-balanced-fund/