Professional Documents
Culture Documents
VENTURE
Bankruptcy is a term that has been
on the minds of many entrepreneurs in
the past couple of years, as business face
weak economy, increase in competition,
and rising costs of doing business.
Bankruptcy lessons:
Many entrepreneurs spend too much time and
effort trying to diversify in markets where they
are a lot of knowledge.
Bankruptcy protects entrepreneurs only from
the creditors, not from competitors.
Its difficult to separate the entrepreneurs from
the business.
Many entrepreneur's do not think their
business are going to fail until its too late.
Entrepreneurs
early.
Surviving Bankruptcy
Reorganization
In this situation the courts try to give the venture
time and breathing room to pay its debt.
A major creditor, any party who has interest or a
group of creditors will usually present the case to the
court.
Then a plan for reorganization will be prepared to
indicate how the business will be turned around.
Strategy During
Reorganization
Liquidation
The fallowing are the key factors that can be reduce
to business failure:
Liquidation
Extreme case of bankruptcy
Voluntary bankruptcy: Entrepreneurs
decision to file for bankruptcy
Exit Strategy
Exit strategies include:
1) An initial public offering (IPO)
2) Private sale of stock
3) Succession by a family member or
a non-family member
4) Merger with another company
5) Liquidation of the company
Direct Sale
Management Buyout
Starting Over
Entrepreneurs start new ventures even after
failing
Entrepreneurs have the need for:
Market research
More initial capitalization
Stronger business skills