WISDOM FROM HARD EARNED EXPERIENCE: THERE’S NEVER A PROBLEM

Until You Have A Problem

My partner at Valize, Ron Boire, has a deep well of experience from years spent at companies large and small, many of them iconic. In this moment, when an entire generation of young business leaders has never experienced a bank run or seen formidable institutions abruptly shut down by financial regulators, I thought a story he tells of advice he gave to a young entrepreneur was profound. You don’t learn this stuff in books!

Read the Story!

BUT, WELL, THERE’S A PROBLEM NOW.

Our entrepreneur felt his firm would be relatively protected from the aftermath of the collapse of Silicon Valley Bank. Their money was safely deposited in a major money-center bank. Their clients had always paid regularly, and they had a good solid pipeline of new business lined up. They had a few invoices out, so their only concern was whether they were going to get paid.

BUT, WELL, THERE’S A PROBLEM NOW. pt.2

Ron said to him, with his characteristic candor, “Well, I don’t think you have to worry that you ’ re not going to get paid because you ’ re not going to get paid. Moreover, don’t worry, because you are literally the last person they’re going to pay. When money gets tight, who’s on the list of who is going to get paid? I’m going to pay my employees. I’m going to pay my taxes. I might pay the rent, but I’m probably not even going to do that. I’m going to pay the electric bill light bill, and maybe the phone bill. That’s it. And once you ’ re past that list, you stop paying people. And you hunker down.”