I would not list the moonlighting under job history since it may make you seem disloyal, non-committal, untrustworthy, or some combination. If I were to actually list that information, I'd make sure the employer was almost certain to appreciate it, and prepare to answer a lot of awkward questions.
Think from the Employer's Perspective
If the company is a start-up, and wants someone who has shown that they can work in that environment, they'd probably appreciate the experience.
If the company is more like your previous 'main' job they may look at it in a not-so-positive light because you've shown you won't commit 100% to the company (hence the moonlighting).
Prepare for Uncomfortable Questions
Regardless of the type of company, if you put two jobs simultaneously on your resume, prepare for some potentially uncomfortable questions, like:
- Can you commit to our company 100%?
- Why did you have a job on the side at all?
- Was your employer aware of the fact that you were working for another company on the side?
- Did you get the permission of your employer before working with the other company?
- Would you have left your 'main' job if the startup became successful?
The big issues for any job could be a perceived lack of loyalty (you were splitting your time and talent between two masters), a perceived attempt to hedge bets and/or issues with commitment. Most companies will have you sign a contract giving the company a right to any work you provide while under their employment. The fact that you were starting a business on the side will not sit well with everyone (even people in start-ups).
If you have good answers to all these questions, and you think the employer will appreciate the skills, then go ahead and toss them on there. Just realize that regardless of how good your explanations are, they will put some people off in the end.
An Alternative Solution
For the above reasons, sticking it under "work history" can be a sticky proposition. One way around that is to put it under "Other Skills" or something similar. After all, the venture didn't pan out so there isn't that much benefit to naming the company, or listing it as employment. Instead you can write some truthful blurb such as:
"From 1673 to 1677 led a team of three people collaborating on a widget to turn Pb into Au."
If the employer finds it interesting, they may ask about it. If they don't, then it's not as likely to raise awkward questions. The employer may still catch on and ask, "What did your company think of that project?" or "That seems like a lot of work to do while working full time, how did you juggle it?" so you should still prepare to answer tough questions.
Tucking it away will make sure that it isn't a focal point of the discussion, but give you an opportunity to bring it up (to whatever extent you want) if it seems relevant or helpful in the interview(s).