Some 60 years ago, F. Scott Fitzgerald famously observed, “There are no second acts in American lives.” There’s been a lot of discussion about what he really meant by that, but taken at face value, the expression couldn’t be further from the truth. We are a nation built on second acts, a nation of comeback kids.
In fact, many of the people at the center of the biggest business success stories in our nation’s economic history failed miserably at some point during their careers.
Henry Ford, for example, started and lost two automobile manufacturing companies before getting it right with the Ford Motor Co. Ford’s first business, the Detroit Automobile Co., went under and was dissolved in less than two years. The second, the Henry Ford Co., ended even more quickly after a disagreement among its partners.
A similar story belongs to Milton S. Hershey, who founded confectionery businesses in Philadelphia and New York. Both went bankrupt in a matter of a few years. But Hershey’s troubles did not end there. Even after the Hershey Chocolate Co. became wildly successful, external economic crises nearly caused it to collapse. Sugar became exceedingly expensive and scarce during World War I, so Hershey stockpiled an enormous quantity of it. When the war ended, the price of sugar plummeted to its pre-war levels, nearly bankrupting him once again. Only by mortgaging everything he owned and putting his business under the scrutiny of bank officials was Hershey able to save his company from going under.
Today, many of you are in the process of watching your businesses founder. And, like Ford and Hershey must have, too, you may be experiencing that dark night of the soul that comes with failure: feelings of loss and despair, and the fear of what will—and won’t—happen next. You may find it nearly impossible to divorce the failure of the business from your own personal failure; businesses and their owners can seem inextricably entwined, with the companies frequently even bearing the family name.
And perhaps because of that interconnectedness, it’s difficult for business owners to realize and admit just how much trouble their companies are in until it’s too late. Builders who are just now thinking they might seek bankruptcy protection may already have reached the point of no return. As director Becky Roof, of business advisory firm AlixPartners, says in John Caulfield’s story on the subject this month (“Taking the Plunge,” page 84), “By the time they get to Chapter 11, most builders are already at the liquidating stage.”
So, if you’re thinking that filing might have to be your next move:
Don’t delay. Acting quickly can mean the difference between using bankruptcy protection to restructure your business or liquidating it.
Seek support from others. Lots of people have been in the same boat. Use your contacts to find some of them and ask about the process and what you can expect. Those who have been through it before will likely offer a sympathetic ear along with some good advice.
Remember that your most valuable asset is you. It’s not your office building, your equipment, or even your land. It’s your knowledge, your determination, and your hard work that have enabled you to create the successes you’ve had.
Try to look ahead to your next act. Others before you swear by the idea that failure begets success. Bernie Marcus, one of Builder’s 30 top innovators of the past 30 years (“Impact Players,” January, page 158), is one of them. Marcus, along with Arthur Blank, was fired from the Handy Dan hardware chain in 1978; the pair went on to found The Home Depot, which in turn became the country’s largest home improvement retailer. Over the years, Marcus has spoken with many successful entrepreneurs who have encountered major setbacks and most count them as a positive experience.
Of course, that’s a lot easier to do in retrospect. For now, consider the avenues available to you and make the best choices you can going forward. And think about taking this observation from Henry Ford as your mantra: “Failure is the opportunity to begin again, more intelligently.”