Raw and Unfiltered - Learn from my mistakes

Today I filed for Chapter 11 Bankruptcy; it was not a good day. The days, weeks, months and arguably years leading up to this have been filled with frustration, anger, sorrow, annoyance, regret and a lot of other useless emotions that do nothing more than eat away at whatever parts of you want to look for the hopeful in life.

Why talk about it? Why post it? Because many of the mistakes and misguided choices were made while building a business, they were made because of a companies desire to succeed and because I didn’t ask enough question, take enough time to get good guidance, and ultimately I trusted without verifying…the hope is that others read this and don’t make the same mistakes.

Also the logic for posting is that I am fortunate to now have people around me who thankfully supported me through the latter part of this. They listened and helped. I would not have made it on my own; I would have either headed for the hills never to be seen again or worse. I would have left daughters and other people behind with no explanation, and that’s not a fitting end to this whole saga, hence writing it down. Hopefully others staring at a wall will take pause and realize that there are others out there you can lean on when times get rough.

So, where to start? We start with a company, a new one that is looking for investment, it’s a services company with a product that’s been self funded for the initial development phase however the market is now catching up to the idea and the company needs to try and stay ahead of the competition…and that’s one of the pitfalls right there. Taking on the million/billion dollar companies directly won’t work. Their toilet roll budget is typically more than your annual revenue…figure out a way to do it better, smarter, faster, cheaper or to a different audience as taking them on head-to-head is going to hurt. Something I didn’t realize until too late, and now years later being inside and watching Acalvio I realize that they have the right way to tackle things…

When it comes to investment box smart, clever and get second, third AND fourth opinions on the people, the terms, conditions AND what the investors bring to the table. Money isn’t all its cracked up to be, again another lesson learned is that you have to chose the money correctly, I chose badly and had an investment team that was mostly risk adverse (especially when their chief technical person ended up plastered all over the front pages of the media). They arguably did not understand the technology, security or overall IT space well enough…I made the mistake of thinking that Telecom people would know our market and I was wrong. People with connections are going to make a huge difference, people who will walk you into companies (not more investors) people who are willing to take you on-board AND champion you to their Rolodex are worth more than almost any check they can write…another lesson learned by watching the Acalvio team is how to work with the investors and how to manage them, help them, inform them and ultimately have it as a partnership as opposed to a combative, questioning, second guessing type of unhealthy relationship.

While we talk about investment, classes of stock, preferred and common, learn these terms and beware of stock where investors get all the preferred and basically leave common to everyone else, again another mistake made and another lesson learned, this one particularly badly as part of the issue when winding up a company (as OWL was by the investors and CEO/CFO after I’d left) those with preferred get “something” out of the proceeds, those with common might as well use their certificates as bonfire fuel. It’s one of those things that you walk into the relationship feeling good, you are on a high, someone is going to give you $$ for your dream, they are basically funding you and your plans…however take a deep breath, push the check back across the table and take a moment to talk about how things will work when the worst happens and you are not all immediately billionaires.

Building a company takes a team, even if that team is the home team, don’t do it unless you have the full support of everyone at home. It sucks, its hard, tiring, stressful and thankless for the most part. I just re-read some notes I’d sent to my (now ex) wife at the time, they detailed the stress at work and the lack of support at home, they were a last minute plea that I’d hit the end of the line, I couldn’t go any further alone and I was done fighting for work and for the people I was trying to provide for all at the same time…reading it back now sucks, but from that point onward and until today it’s been 7 years and only now is that very fight coming to a close with the chapter 11 being filed…it doesn’t include the 5 years of back and forth while trying to get CCi5, Cyopsis and obviously OWL off the ground… Building companies takes either a single person with no commitments AND a lot of friends or a family to all understand that this is going to be an undertaking and everyone’s on board otherwise it’s a battle all the way and that’s never going to be good. I failed here, I didn’t understand the effort it would take or the toll it would exert on family. I also didn’t plan enough for getting help in the office to help alleviate some of the stresses and hassles, left it too late or didn’t hand over enough things to allow some time away from the office. Again, something in hindsight that has to be understood, and something that to this day is brought up against me in court whenever the ex and I cross swords.

By the time the wife became the ex-wife the company wanted to ensure she was not in the picture in any way/shape/form when it came to decision making, ownership or anything else, and this is where it got really pear shaped (yes it could get worse…) We had company lawyers, investor lawyer, my lawyer and her lawyer and other lawyers sitting round trying to work things out, some were good, some were (as we now know) worse than useless and ultimately paperwork was drawn up to remove her from the company in return for a promissory note secured against my interests in the company, this seemed to be good, although how a note was signed/agreed to for more than her % and valuation was worth is still a mystery to me today. (Note here, read, re-read and if you don’t like it don’t bloody sign it even if it means all the lawyers get in a room again…)

So, a promissory note made the investors and the board of directors happy, I was on the hook for the note and the monthly interest payment, not great but I was advised it would all be good, the company would succeed and the pot of gold at the end of the rainbow would take care of her and get me into the 2 door V12 from Italy that I’d been drawing idly on the whiteboard…you can see where this is going…next stop “Hacker makes plane move sideways!” Oh yea, not only did the FBI, CIA and others arrive at the office but so did the board of directors, the investors and the CEO and CFO all requiring blood, head and other appendages…it’s a little more drawn out than that but you get the idea, instead of embracing the issue and rallying behind the outspoken guy and stating something positive the knives came out and the V12 Italian thing on the whiteboard was replaced by simple math that the investors would not be helping out any more and OWL would have to shed ? it’s workforce. Not a good day in either personal or professional history. We’ll leave out the investors/boards decision to appoint a CEO they liked and then decide to not fund the company, we’ll also leave out the new CEO’s and CFO conversations and ultimate challenges when it came to a matter of being upfront, ethical and other things…and FFWD to the point where OWL and I part company, I go and work as a consultant for a friend and get back into breaking things for a small outfit... Then OWL folds in on itself, closes the doors, wipes out the company and starts again under a slightly different name.

Great I think, that promissory note for ? a company that no longer exists is dead, I got nothing, she gets nothing…yea, think again. Apparently a torpedoed company simply meant I get nothing more than a headache and lawyer bills and she still gets her chunk of change, the monthly interest payment and then a rather larger lump sum in 10 years. Remember that read it, read it again and have someone else bloody read it…yea, know that now, didn’t know it back then.

Long story short, from Mid-2015 until today it’s been lawyers, fights, more lawyers, more fights, no budging, no real negotiations and the once “partner for life” has become the noose for 10 years (or more) for which I saw no exit, I had signed something based on the knowledge I gleaned from others, I should never have signed it, but OWL and others needed it signed so I bowed to the pressure and signed it, that was a huge mistake and one that basically led to today. I don’t have other debts to speak of, I have not gone wild with the credit cards, the store cards, the gambling or anything else…the Chapter 11 is because I put pen to paper on a document that was meant to clear the way to a successful future for a company that no longer exists. I expected the best and totally failed to plan for the worst.

The mantra of “expect the best; plan for the worst” is something we all should abide by, in personal life and in professional work. It is not something I did well and it is not something that I’d planned for in either realm. I have learned my lesson (for the most part) when talking with Acalvio a year ago I started by apologizing that I was going to be an ass when it comes to legal stuff, investors and other things that needed sorting out, I was going to read everything and have others do it too, thankfully they understood and accepted that history was necessitating that from me. To their credit Acalvio is not the founders first rodeos so they’ve been through similar experiences and have managed to successfully pilot a number of companies to great conclusions, I am thankful that I now get to watch, learn and understand just how badly I screwed up.

We all have our expertise in certain fields, we need to recognize when we are deficient in others and embrace people who can help fill in those gaps, choosing them IS hard and sometimes it takes mistakes and lumps to get good ones…I am fortunate that I have people around me who will not let me screw up again as badly, some have threatened to shoot me should I sign anything as dumb as that piece of paper again…

If nothing else please learn from my mistakes, make new and innovative ones, but please never get into the same mess as I did.

Good Luck

Chris