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Ghost Stories for Entrepreneurs

Agenda. What is Bankruptcy?Mechanics of ShutdownThe Big Don'tsThe Hardest PartLiquidity PreferenceThings I'd Do DifferentlyProtecting Your Own HideThe Things People Say . What is Bankruptcy?. Bankruptcy is a court managed dissolution of your companyIt is of no value if there are no signi

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Ghost Stories for Entrepreneurs

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    1. Ghost Stories for Entrepreneurs John Witchel Former CEO, Red Gorilla Principal, Cole Valley Group

    2. Agenda What is Bankruptcy? Mechanics of Shutdown The Big Donts The Hardest Part Liquidity Preference Things Id Do Differently Protecting Your Own Hide The Things People Say

    3. What is Bankruptcy? Bankruptcy is a court managed dissolution of your company It is of no value if there are no significant assets to fight over It does not protect you from or alleviate you of your obligations If you think corporate lawyers suck

    4. The Mechanics of a Shutdown The Night Before Tell Your Wife Day One Tell all your employees to their faces Call your major investors & your board Call your major customers Call your major suppliers Day Two Hide Days Three Seven Questions and Answers Day Eight One Hundred and Eighty Deal with an astonishing amount of BS

    5. The Big Donts Dont Talk to the Press Dont Promise Anything to Anybody Dont Feel Sorry for Yourself, Your Investors, Your Management Team or Your Employees Dont Lie, Apologize or Sugarcoat Dont Make Backroom Deals Dont Mess with the IRS or the DOL Dont Treat Yourself to a Little Preference

    6. The Hardest Part: Your Employees Some People Infuse Employment With a Paternalistic Quality This can result in literally child like responses: rage, blame, vengeance, etc. Do Not Indulge Them

    7. Liquidity Preference Understand Your Cap Table A $7M acquisition offer with $10M of VC liquidation preference aint worth squat to you We Dont Save Face in America A sale to say just you sold your company is a joke

    8. Things Youd Do Differently Never Sign a Personal Guarantee Again Never Let Cash Reserves Drop Below 120 Days Never Count on an Unknown Event

    9. Protecting Your Own Hide Get and Maintain D&O Insurance Pay Your Taxes Pay Your 401K Dont Make it Easy

    10. The Things People Say You Are Not Personally Responsible for Your Companies Obligations Your First Duty is to Your Family Your Reputation is Not For Sale The Media is Not the Place to Respond

    11. Conclusion

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