Vulture Capital
You can't beat the big creditors to the bones of a bankrupt client, so what do you do?
Before September 11, Le Gourmet Gift Basket Inc. was growing at a healthy clip. But in the months that followed the attacks, with steep drops in the stock market and mounting layoffs, many of its would-be customers began welshing on their contracts and bouncing checks. Five of them went bankrupt in a 10-month period. "I've never seen anything like it," says Cynthia McKay, 47, president and CEO of the Denver-based franchise.
McKay stood in line with the other creditors but was mostly unsuccessful in her efforts to recoup her investments. Although there might be some indication of a problem beforehand, she says, often "you don't know 'til you get that little postcard [from bankruptcy court]."
4th of July Subscription Sale - Unlock this subscriber exclusive article and more for 20% off today.
Access all Entrepreneur content with no ads, unlock discounts, and get exclusive advice only available to our subscribers. Plus, our magazine delivered straight to your door.
Get 20% off an annual subscription today. Just use code SAVE20 at checkout.
Entrepreneur Editors' Picks
-
Formerly Enslaved Black Man Nearest Green Taught Jack Daniel Everything He Knew About Whiskey. Today, the Founder of Uncle Nearest Premium Whiskey Celebrates His Legacy.
-
Leadership Lessons From the Exclusive Creativity School That 'Packs 5 Years Learning Into 5 Days'
-
3 Expert-Backed Strategies for Staying Calm in Times of Confrontation
-
The CEO of Wayfair Has Helped Revolutionize Digital Shopping for 20 Years. Here's How He Handles Rocky Economic Conditions.
-
This Founder Went to Prison When He Was 15 Years Old. That's Where He Came Up With the Idea for a Company Now Backed By John Legend.
-
3 Signs You're Letting Pride Get in the Way of Being Successful
-
Chip and Joanna Gaines and Shonda Rhimes Found Incredible Success By Using This One Entrepreneurial Strategy. Here's How You Can Too.