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I Got The Blues

One company's experience with the cash-flow blues and how it lived to sell again

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This story appears in the September 2000 issue of Entrepreneurs Start-Ups magazine.

We've all heard of Murphy's Law: "Anything that can go wrong, will go wrong." But what about the cash-flow law? "No matter how much money you have coming in, it never comes in soon enough to cover your expenses." Chalk this phenomenon up as one of the dirty little secrets of running a business that no one really talks about. Then, suddenly, you're up to your ears in bills with a near-empty bank account, and you don't know where to turn.

My first experience with the cash-flow blues happened in my second year of business, once we had a staff, an office, equipment and the usual overhead of any growing business. My partner pulled me into his office one day and announced, "If we don't get a check in by Friday, we won't make payroll." Not make payroll? That couldn't be possible! We had a slew of clients, a ton of work in production. How could our bank account be so depleted that we were in jeopardy of not paying our staff?

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