Over the years I have presided over the births and deaths of hundreds of small businesses. As an attorney, I have watched many of them grow, mature, and thrive, but I have seen many more stumble, fall, and die.
It is painful to see an entrepreneur, once so full of hope and excitement, suddenly desperate and defeated. I am saddened when I drive down the street and see an empty storefront, as I know someone has suffered an immeasurable loss, and endured extraordinary grief and pain trying to save their piece of the American dream.
There are few experiences in life as painful and brutal as the failure of a small business. For a small business conceived and nurtured by its owner is like a living, breathing child. Its loss is no less traumatic than losing a loved one. After all, a business owner spends most of his waking hours at work. He will invariably become very attached to it, particularly if it is the business he loves and the one he has always wanted to pursue.
Inevitably the business becomes an extension of the owner himself. When it is ailing, he is ailing as well from stress and worry over whatever problems the business is facing. When the business is thriving, he will be happy, confident, and enjoying life to the fullest. If the business fails, the owner will feel like a failure and suffer deep emotional scars that will greatly impact his personal life for years to come.
With business failure often comes marital strife and divorce. I don’t claim to be a psychologist, but every day I see husbands and wives torn apart because one blames the other for a business failure. Or, if they don’t blame each other, they are often so tired and battered from battling with creditors that they give up on the marriage. The sight of each other only brings back bad memories. So too often the unhappy couple opts for divorce. If the marriage does survive, it will never be the same.
Having watched my small business clients closely over the years and having operated my own law practice, I have come to some conclusions about why some businesses succeed while others fail. The sad fact is that many of the businesses I have seen fail could have been successful. The good news is that it’s not too late for those still in business, if they will wake up and take control of their destiny.
In my new book, Go Broke, Die Rich, Turning Around the Troubled Small Business, ISBN 978-1-929976-9-59, I explain these common causes of small business failure, how to identify them, and what can be done to defend the business while it is being turned around.
Don’t get me wrong. This book doesn’t contain any magical formula for success. Turning a business around requires hard work, discipline, and sacrifice. But what I hope this book will do is give the reader insight into why so many small businesses fail, and provide solutions and strategies that can help turn around an ailing business.
This book is intentionally written in a simple, informal style for the average business owner rather than for college graduates or MBAs. I’ve found that the cause of business failure isn’t just a lack of education, experience, or business training, but just as often a lack of common sense. Often small business owners, or “entrepreneurs”s as I call them in the book, do things they know are stupid and reckless. Why? Because entrepreneurs by definition are risk-takers. They like to experiment and do brash things that may only have a slim chance of success. They are the eternal optimist and often have unrealistic expectations.
Although my major at UCLA back in the late 60s was political science, fortunately, I did minor in economics. The business courses I took were helpful to me when I started in law practice in 1976. More importantly, however, was the training I received at Metropolitan Life Insurance Company. While I was in law school I had to support my wife and four children, so I worked full time selling life insurance. This wasn’t a glamorous job, but I did learn much about financial and business planning—something that had scarcely been mentioned in high school or college.
Go Broke, Die Rich is not intended to be a manual or reference book. It is my hope that it will be interesting, entertaining, and informative. I fear too many self-help books get stuck on a shelf and never read cover-to-cover because they are too much like a textbook. This book is about adversity and how to overcome it. Its full of practical advice and ideas on how to deal with just about every adversity an entrepreneur might face.
Go Broke, Die Rich is full of real life events that should be of interest to any small business owner. Obviously, the names and locations have been changed and the facts altered enough such that no confidences will be breached. Hopefully, the reader will be able to identify with the characters in these stories and understand the problems they face. The reader will, no doubt, be facing similar problems and can learn from the mistakes made by the business owners in these stories.
As needed, I will provide legal and business advice but it will not be technical or hard to understand. It is not my intention to burden the reader with the complexities of the law, but simply to give them ideas and alternatives that will provide direction and avenues to take toward solving the problems encountered.
I consider every business failure a tragedy and, when it is one of my clients who goes down, it is even more troubling. I often lie awake at night wondering if there was something else I could have done to save a client’s business and spare him and his family the dire consequences of a business failure. My only hope is that this book will help other entrepreneurs save their small businesses.