The other side of entrepreneurship

A friend of mine was talking to her father on the phone the other day when representatives from the bank arrived at the door. This is not a good thing. Any communication from the bank that doesn’t come in a white envelope with bulk rate postage is never good.

Business was tough. It had been tough before, but a little paid-in capital from the owner always saw it through to better times. This time was different. His customers weren’t paying their bills, and the worst kind of trickle down economics was in effect.

The story of that business is not over. I don’t know how it will turn out, but just the same, it got me thinking. Almost every entrepreneur in the video business faces lean times. We all go into our ventures vowing never to let them threaten our mortgage payments or our kids’ educations. Yet when it hits the fan, how many of us will keep that promise?

With great reward, comes great risk. We know that going in, but we deny the worst could ever happen to us. Like death, we block it out and go on as if it can only happen to the other guy. We know better.

When I heard what happened to my friend’s dad I couldn’t help but think of all the people who benefited from his risk taking. All the people who bought houses on the income his business generated, the students who made tuition because of the summer jobs the business created, and the vendors who profited from his business (Kingpin among them).

The real world’s not like It’s a Wonderful Life. No one’s going to take up a collection to make the loan payments. He’ll either do it on his own, or he’ll throw in the towel. I don’t know how this story will end.

America’s a great place. The child of a third world immigrant can make a six-figure income. It’s not easy, but it can be done here. Where else on this planet can that happen with any regularity? But there’s a downside, and I was reminded of it this week. There’s no safety net for the American entrepreneur. So if praying’s your thing, consider offering one up for those middle class heroes. They are the ones who built America. It takes a lot of guts to do what they do.

Hats off to the likes of Wes Plate, Jim Tierney, Philip Hodgetts, Terry Curren, Jim Feeley, Michael Buday, and the scores we know like them who could make a mint punching the clock for the man but have decided to roll the dice for something better.

Now back to our regularly scheduled programming.

3 Thoughts on “The other side of entrepreneurship

  1. Thanks Frank for this heartfelt reminder. I am lucky enough to have worked with just about everyone you mentioned here — it’s these very guys who have made my existence in this industry possible. And for that, I’m thankful everyday!

  2. Editor’s note: Kevin’s another guy who could make a killing punching the clock, but has taken the road less traveled.

  3. Patrick Inhofer on April 16, 2007 at 3:13 pm said:

    Frank, great post. One of the best (but most difficult) ways for an entreneur to survive the lean times is to avoid loans, leans, lines-of-credit, and credit cards. In other words, grow slow and pay cash.

    Easy money raises risk and very few of us bother to understand how much risk we take by running a business on credit. Even incorporated, chances are if you’re a small business you’ll be personally liable for most of those loans and credit cards (it’s in the fine print and there’s no such thing as the American Express Corporate Card).

    It’s a philosophy I’ve embraced in my business, and what a relief it is when cash flow is negative (even though sales have been brisk – a whole other discussion) and I know I won’t have creditors knocking on my door.

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