The Price Of Running A Business (Into The Ground)

A sad thing to happen to any business
A sad thing to happen to any business. But going out of business is working hard.

About a month ago, a simple message came in that disrupted the regular rhythm of the week. My prime source of income would fall away as it was told an investor did not invest in the company I worked with as was promised and payments could not be made.

A long time ago, I have been in the situation of being the bearer of that news with my own company that my partner and i ran. We thought it would only be fair that when we noticed things did not go the way we planned, and also that we did not have the know-how back then how to fix it, to simply call it quits at that time, and close the doors. We decided to pay off what we owed and be realistic about it, but avoid bankruptcy in any way. That was a high price to pay for people just in their twenties, but we did.

When you hit such a bump in the road, you have to understand that cleaning up your act is something you need to do well. You cannot simply ignore the problems, put your head in the sand and wishing it all will go away. Nor can you be too pessimistic and feel bad about yourself. If you have a company where you employ people, you have to clean things up correctly. And sadly, in this scenario, the immediate problem was ignored.

I like to be open about certain information with people I work with. If there are potential problems on the horizon that involves your employees, you need to be frank about it. Discuss it. There are too many managers and company owners and CEO’s that love to show how good they are, but a real good business person knows that it is not about appearances, but about how you really act in difficult times.

In my whole life I had good and bad managers. A lot of them with good intentions, but only a couple who really did rice to the occasion. At one moment, about 12 years ago, I was recruited by this team who decided to build Flash games for the Play Station 2. Around that time, the news broke that Sony was thinking about integrating the Flash Player into the firmware of the Play Station, and we had an extensive amount of knowledge to build Web Apps and RIA’s in Flash. So why not make something new? We hooked up with a world-famous institute to support us for making a edutainment game for 10+ ages. 7 people, of which I was responsible for the design and front-end development, worked together by building a platform. We hired vacation homes and brought our stuff together and worked, worked and worked. Although officially there was no leader, it was the only time I ever noticed that there was also no problem about it. One person was our manager, and he was absolutely amazing at it. As we got our demo and prototype to an advanced stage, we were invited to a conversation with Sony Europe.  And at the moment our guy came back, he sat down and delivered us the bad news; Flash was not going to be implemented in the Play Station. Period.

Right then and there, of course with sad hearts, we also looked at everything together; the concept of the game was good, but Flash was already so well presented online, the game would not make sense with a mouse and keyboard. It would become something mediocre to semi good at best.

We decided to wrap things up, not trying to hang on to it simply because this was our strength; Flash development and it’s back-end system. If we would keep working on it, it would never be what we intended, and together with our guy, our company drifted apart.

What worked here, and why I have such great memories to this time, was how clear everything was. There were the amazing moments of pure passion and things were going great! But then there were also problems. They are there, simple. There is no business that can run without problems. They need to be there, because they show how well you will perform and deal with it. This ‘game’ company, even how young it was, did it very well. No bad feelings, not a single one. Our manager was absolutely amazing, and I worked with him before and after that with great joy.

And when the news hit me last month, I noticed that the problem was being mentioned as ‘the investment’. The ‘investment’ is never the problem. If your company is doing it’s work well, the manager or owner has kept you up to date about possible problems – or possibilities – then it is practically impossible to have an acute money problem. But when asked about it – because there are always the tell-tale signs of problems no matter what people try to make you believe about the condition of a company – and it is absolutely denied that there are any problems, what can you do?

It is about cleaning everything up, contacting your clients, update them about situations. It is making sure machines are wiped properly, especially the ones used for running Payroll and holding private information about employees. It is resetting accounts, backing all the work up and making sure that data is locked and encrypted. It is notifying your employees right away, and be absolutely clear to them, and be honest.

It is sad to say that this is not always the case, and I know that goes for a lot of companies and not only here in the US, but everywhere. I guess most people simply want to enjoy the good times, but have no idea how to deal with the bad ones. Sadly, because it is part of running a business.

My partner and I, who saw the water at our necks before we called it quits in 1999, sat down together. The money we saw that we owed was an amount so large in our opinion back then that we panicked. That was not the reason why we closed up shop, but it made us very afraid. Not so much of the money, but that we thought we were doing things right, but clearly something was in there – that we did not understand – that we did wrong. Very wrong. We were able to identify the problem, knew how to fix it, but we could not fix it at the time. We were too inexperienced, not in building our products, but at running a business. And yes, now we know we could have hired someone to run it for us, but again, we did not have that experience. Still, even though the price paid was high, it was the best lesson in business I ever learned.

Advertisements

2 thoughts on “The Price Of Running A Business (Into The Ground)

    1. Thank you so much for your kind words. Yes, I have seen more similar scenarios, and I think a lot of people have in the last couple of years. That is why I appreciate if a business can round up it’s work correctly, which is better for everyone, especially the employees. From your words it sounds like your husband got well back on his feet again, and am happy to hear it.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s