The Ugly Reality of Deception
Several years ago, a fellow EO member and I purchased a print shop. Literally overnight, we grew our print brokerage to five times its original size. At the time, we were both 27 years old, and the average age of our 50 employees was 68 years old. We thought we had it made— life was good and business was booming.
Shortly after we bought the business, however, we discovered that it had been misrepresented by more than US$1 million a year in revenue, among other things. Before long the bank took over the business, and my partner and
I went bankrupt. What’s worse, we ended up in a seven-year legal battle challenging our bankruptcy. If we had lost, then we would have owed more than US$1 million in perpetuity and racked up more than US$100,000 a year in interest fees alone.
We eventually won, if you could call it that: I lost years of productivity and sold my house and possessions to pay the attorneys. It was a difficult time for me, one full of heartache, business pains and valuable lessons learned.
Focus Forward, Not Backward
During the legal battles, I constantly thought that if I made any money, I would only lose it in court. So I held back, was cautious and hunkered down into safety mode. The crisis prevented me from being who I really am. Looking back, I should have stuck to what made me successful in the first place. If I focused on making a lot of money then, I wouldn’t have worried as much and I’d be years ahead in my business now. Unfortunately, I let myself become a quiet victim to my circumstances.
Find Your Real Value
At the time of this business emergency, I was young and based my self-worth on the size of my business. I believed I was a good person because I had 50 employees that were all twice as old as I was. Then I lost the business, and I realized that I was still a good person, regardless of the money, the employees, the size of our building, etc. I’ve since adjusted my thinking, and I’ve netted higherquality results that have helped me become a better business owner.
Ignore Your Ego
When we purchased our new business, we let all of the staff who were related to the seller go. One of the employees was the seller’s nephew. When the seller passed away several months later, guess who was in charge of a multi-million dollar trust, and who hated us with a passion? This nephew pursued us for seven years, spending half a million dollars in attorney fees to exact his revenge.
We were completely in the right and knew that we would clearly win in the end— we did. However, it clearly would have been a much better business decision for us to have offered settlement money instead of defending ourselves. Our sense of “right” and our egos got in the way of a purely practical decision that could have saved us years of lost time and money.
Not Everything Can be Delegated
As obvious as this lesson is, somehow I overlooked it. I should have made it a point to personally understand the process of buying and selling a business. I delegated my authority on this to my business partner, my bookkeeper, a crooked “business broker” and a deceptive seller.
I had become so used to allowing other people to know things for me that I didn’t know the details of how the most important transaction in my business history should have worked. Had I made it a point to understand the process better, I would never have been in that situation.
Learn from Others Who Have Done It
Nearly 10 years later, I still call EO the best insurance policy I could ever have. Had I been in Forum when this whole transaction went down, my peers would have made it clear to me that I needed my own attorneys, and they would have helped me understand the perils and pitfalls of a major transaction. They would have referred me to the proper experts in the field, and I wouldn’t have had such a brutally painful learning experience.