Founders who sold or didn't sell reflect on their decisions

In the New York Times, this article provides a very cool window into the minds of entrepreneurs who sold (or didn't sell) their companies. The founders' recollections provide a glimpse into some deep stuff, including how our significant decisions look upon reflection, what is a mistake, etc. Here's PayPal co-founder Max Levchin recalling his next startup experience:

His next company, Slide, was a different story. It made social apps and sold to Google for $228 million. Google shut it down a year later.

“The honest truth about Slide was we were a five-year-old company that had wandered through the desert for a long time wondering what business to be in,” said Mr. Levchin, who later started a new software company, HVF. “I wanted to top PayPal and it didn’t work.”

And here's Ben Horowitz on selling the company he co-founded, Opsware:

“I spent eight years, all day every day, trying to build this thing, and all of a sudden it’s gone, it’s just over,” he said. “It’s a little bit like something dies.

“That decision was one of the most isolated and alone decisions you ever make,” said Mr. Horowitz, who now advises entrepreneurs as a venture capitalist at Andreessen Horowitz. “On the surface it looked good, but I tell you after I sold the company I had total seller’s remorse.”

And Philippe Courtout on cc:Mail:

Mr. Courtot received a second acquisition offer, this time from Lotus Development for $55 million in cash.

Under Lotus, cc:Mail grew from four million users to 24 million, until IBM acquired Lotus in 1995 and shut down cc:Mail. Microsoft Mail eventually became Outlook.

“I should not have sold,” said Mr. Courtot, who is now chairman and chief executive of Qualys, a security company that went public last year. “That was my biggest regret. We could have moved much, much faster and brought it to the cloud. But such is life.”

Tim Berry - Buying into the dot-com boom hype

Tim Berry, founder of Palo Alto Software (developer of Business Plan Pro) has contributed much to this site (see here for a collection of stories from Tim). In this audio story taken from a longer interview, Tim discusses how his company was affected during the dot-com bubble of the late 1990's, and how he got caught up in the enthusiasm, with results you might expect.

You can download the podcast file here: Tim Berry - believing the dot-com hype (4:04)

Transcript:

So I was one of those who bought the craziness of the dot-com boom. And it was hard for me not to, because Palo Alto Software back in 1998 and 1999 was riding the web very high. I mean we're still very strong on the web; we get multiple millions of unique visitors per month at bplans.com. But back in '98 and '99 the half a million monthly unique visitors put us in the spotlight of that craziness where professional investors were valuing companies by their web traffic rather than their revenues. And although I should have had the vision to see that that wasn't going to last, what I did, to be perfectly honest, was I started to believe we were worth what the web traffic valued us at. Which was like $50 million, just to make it general. This was a company that had only consulting until '94. Our product business started in '95. We'd been successful; we'd been having double-digit growth, so we grew from a few hundred thousand dollars per year to five million dollars by 1998. So we were a good, interesting company, but in any normal time nobody would value the company at $50 million. But we had these web sites.

So I bought into this. We negotiated a minority equity share from venture capitalists in Palo Alto, CA. [We had moved to Eugene, OR.] We set about essentially getting the $50 million for the company. And we were just getting ready for that when the dot-com boom crashed. And, there we were, with a minority venture capital investment that was all predicated on us selling the company for $50 million. And after the crash, it wasn't worth $50 million. So eventually we had to buy the venture capitalists back out. Because you don't want to have an unhappy minority investor in your company. You don't want people to lose money on your company. It took us a while and it was painful, and it was just us. Because it was my wife and I just doing it. We managed the cash flow to get the venture capitalists their money back, with interest. And buy them back, and then the company became fully ours again. It was a long, difficult process, and caused a lot of upheaval.

And in the meantime, when the dot-com boom crash, our sales fell. We've declined in sales only two years since Business Plan Pro came out. One was 2001, the other was 2009. In 2001, when sales fell very fast, I failed to see that quickly enough, and I held on too long, and caused us a lot of financial problems from not cutting expenses fast enough.

Super Bowl special: the 3 mistakes that created the New England Patriots' dynasty

Sports Illustrated, writing about Super Bowl 46 between the Patriots and the Giants, outlines three decisions, which appeared to be mistakes at the time, that created the modern Patriots, a team that has been to the Super Bowl five out of the past 12 seasons.

1) Overpaying for the franchise. While bidding for the Patriots in 1993, Robert Kraft felt that the team was worth $115 million, and he was prepared to pay up to $125 million for the team. Prior to this, the Patriots had been owned by a succession of goofy owners (remember Victor Kiam?) and played in the worst stadium in the league. When James Orthwein asked for $172 million (the largest price ever asked for an NFL team at the time), Kraft swallowed hard and paid up, though at the time no one (including his wife) thought it was a price worth paying.

2) Hiring Bill Belichick as coach. Belichick, a successful assistant coach with the Giants for many years, had an undistinguished run as Browns head coach from 1991 to 1995. Nonetheless, after the 2000 season, Kraft had his eye on Belichick, then an assistant with the New York Jets, as a possible head coach for his team. At the time Kraft had decided to hire him, Belichick was under contract to the Jets to become their head coach if then coach Bill Parcells were to retire - which happened the same day that Kraft asked for permission to negotiate with Belichick. After the dust settled (Belichick submitted a famous resignation letter written on a napkin: "I have decided to resign as HC of the NYJ.") It cost the Patriots a valuable first-round draft choice to compensate the Jets for signing Belichick, a price that seemed steep at the time. In hindsight, it was a tremendous bargain.

3) Replacing Drew Bledsoe with Tom Brady at quarterback. Bledsoe was the best quarterback in Patriots history and had led them to the Super Bowl. He had been the #1 overall pick in the draft the year he came out of college. Brady was the 199th player picked the year he came out. In Brady's second year, Bledsoe got hurt, and Brady led the team well in his absence. When Bledsoe was healthy again later in the season, many (including me) assumed Bledsoe would get his starting job back. Belichick and Kraft thought otherwise. They stayed with Brady and the rest is history.

Bold moves that seemed like missteps at the time, and turned out to be brilliant mistakes after all.

Royal Little: Ignorance isn't bliss when you're an investor

Another story from Textron founder Royal Little (1896-1989), author of "How to Lose $100,000,000 and Other Valuable Advice." In spite of his wealth of mistake stories, Little was one of the most successful US businessmen of the mid-1900s.

MEDICAL OPINION AND REVIEW


During this period of rapid expansion, we noticed that the stocks of publishing businesses were selling at an unusually high multiple, and, although we had had no experience whatseoever in the publishing business, we thought it might improve our multiple of we bought a couple of businesses in the field.


The first one that was brought to our attention was Medical Opinion and Review, which was owned by two individuals. They had built a very profitable operation providing the doctors in the country with up-to-date information on all medical research and other medical information in summary form so that the doctors could get this information without having to read all the complicated medical journals and other sources.


They built up pretax earnings of $1 million, but since they had no fixed assets and only receivables from the drug manufacturers who were supporting the operation with their advertisements, the company had very little net worth. In October 1969, we made arrangements with the owners to buy their stock for $4.5 million in cash, or approximately nine times aftertax earnings. The sellers had to pay capital gains taxes on the transaction, but they both ended up as millionaires. We had hoped, of course, that they would work as hard in the future as they had in the past and that our investment would prove to be a successful one.


Unfortunately, the partner who did the editorial work providing the important information for the publication decided that he wanted to retire. The other partner, who handled the distribution and solicitation of advertising, was left without a competent editor. As a result the advertisers discontinued using the publication to reach doctors and Medical Opinion and Review suddenly became a loser instead of a winner.


Since our experience in the past had been primarily with manufacturing operations, we had no one in the organization competent to rehabilitate that division. After that disaster, we practically gave the business back to the remaining former owner and took our loss.

ADVICE #1: Don't get involved in the publishing business if your principal business has been manufacturing - particularly if you have made the former owners wealthy.

ADVICE #2: (This second bit of advice applies to all types of acquisitions.) Be very careful not to buy businesses that have earnings but no net worth. If the earnings evaporate, you have no escape route to recover any portion of your investment.

Ultra-competitive mindset leads to acquisition mistakes

Deepak Malhotra (co-author of "Negotiation Genius," one of 2007's top 5 books) and colleagues have once again dived into the psychology of negotiators and dealmakers in May's Harvard Business Review ("When Winning is Everything").

They find that certain factors present in many deals can drive irrational thinking and, ultimately, overpaying for acquisitions. The factors are:

1. Rivalry - animosity toward a competitive rival for an acquisition, say, can create a "win at all costs" mentality.
2. Time Pressure - racing to meet a stated or internal deadline can lead to accepting a poor deal
3. The Spotlight - if people are watching--coworkers or the public--a dealmaker may act less rationally than if the spotlight were off.

Malhotra et al write: "Rivalry, time pressure and a bright spotlight can each fuel competitive arousal. Collectively, they can lead to decision disasters." They point to the Boston Scientific acquisition of Guidant and Viacom's purchase of Paramount as two costly examples of this type.

What to do? As in "Negotiation Genius," Malhotra urges dealmakers, first of all, to be aware that these factors exist. Mere awareness of a feeling of time pressure is a tool to prompt reflection: "Is there a reason this has to be done this week?" Almost always, the answer is no. The world won't end if the deal is delayed.

As for rivalry and the spotlight, companies can put approaches in place to manage them. Often, it means spreading the responsibility among teams of dealmakers rather than allowing individuals to shoulder the entire burden. [Microsoft might have managed 2008's Yahoo engagement better if it had not allowed it to become Steve Ballmer's deal. The jury will be out for a while, of course, on the Skype acquisition.]

Malhotra and his colleagues are probing into new and important territory in business research. By bringing behavioral economics and psychology into the forefront of dealmaking and negotiation, they are providing a valuable service to businesspeople everywhere.

Most refreshingly, their focus on the costs of dealmakers' irrationality and aggression is a welcome antidote to the lionizing of ultracompetitive CEOs and moguls elsewhere in the business press.

(Photo: a still from the infamous Steve Ballmer monkey dance)


Related posts:
"The Best Negotating Book I've Ever Read"

Royal Little: the $1 million net worth mistake

Another story from Textron founder Royal Little (1896-1989), author of "How to Lose $100,000,000 and Other Valuable Advice." In spite of his wealth of mistake stories, Little was one of the most successful US businessmen of the mid-1900s.

CAMCAR

Camcar Screw and Manufacturing Corporation was privately owned by Bob Campbell, Ray Carlson, and Bob's brother, who was head of sales. Their principal operations were in Rockford, Illinois, and the company had been very successful in supplying small metal fasteners of various types to the automobile and aircraft industries and to other users of such parts. They showed me their balance sheet whith a complete disclosure of net worth as they had computed it in the past, and, of course, we had their sales and earnings for many years to determine the steadiness of their past earnings record. We bought Camcar on October 1, 1955.

The contract was drawn by the lawyers, without our auditors being present, on the basis of determining the net worth under sound accounting principles, but when the joint audit was made at closing both their auditors and ours added $1 million to the net worth figures that had been shown to me. They claimed that the company had been incorrect in the past in writing off over $1 million worth of dies and tools, which both auditors claimed should have been capitalized. While we had assumed the net worth would be as shown to us during negotiations, Textron had to put up $1 million more than we had anticipated.

In spite of this mistake on my part, Camcar has been an excellent acquisition for Textron.

ADVICE: Never let your lawyers prepare a purchase and sales agreement for an acquisition without having auditors representing both sides present to prevent a misunderstanding of this sort.

[pp. 152-153]

Excerpted from How to Lose $100,000,000 and Other Valuable Advice, by Royal Little, (c) 1979 by Royal Little and the Harvard University Graduate School of Business Administration.

Royal Little: not going the last $500K to buy a great company

Another story from Textron founder Royal Little (1896-1989), author of "How to Lose $100,000,000 and Other Valuable Advice."


This is from a section called "Lost Opportunities":

In addition to losing money for Textron through mistakes, I lost millions for the shareholders by not paying the asking price on several most attractive acquisitions. There must have been at least a dozen cases where the seller and I were a few hundred thousand dollars apart, where I would not budge and refused to meet the seller's price....

JOSTEN

The outstanding case of where I got stubborn and would not meet the offering price concerned Josten. Josten was a competitor of Balfour in making rings for students in schools and colleges. Balfour originally was the leader in this industry, but Josten [as of 1978] now far exceeds them in volume and profits. The offering price was $13,000,000, and I finally came up to $12,500,000 but wouldn't go the last half million dollars. As a result of this lost opportunity, this mistake on my part undoubtedly cost the Textron stockholders over $30,000,000 in lost values. Dan Gainey, who controlled the company and was at the time treasurer of the Republican Party, then made a public offering. In 1976, sales were $163,700,000, net profit after taxes $9,525,600, net worth was $43,000,000, and their 5,040,000 common shares at $25 had an aggregate market value of $126,000,000.

Josten would have been an ideal acquisition for Textron since it fitted our basic concept if being a leader in a relatively small industry. Today Josten is the undisputed leader in the school ring business, and their performance is so superb that their shares are selling at a price/earnings multiple of 12, whereas Textron stock has recently been selling at only 6 times. In retrospect, of the many situations that Textron missed by being too conservative in the price we were willing to pay, the outstanding examples would have to [include] Josten.

ADVICE: If you have an opportunity to purchase a company as outstanding as Josten, don't let a mere $500,000 stand in the way. If a business such as Josten's with its tremendous future potential is worth $12,500,000 it certainly is worth $13,000,000. Refusing to meet the firm offering price in this case was one of the worst mistakes I ever made at Textron.


[pp. 187-188]

Excerpted from How to Lose $100,000,000 and Other Valuable Advice, by Royal Little, (c) 1979 by Royal Little and the Harvard University Graduate School of Business Administration.

John Bliss audio story - don't give away equity for nothing

John Bliss is the founding principal of BlissPR. He sat down for a lengthy interview in 2010, from which this story is excerpted. John talks about inviting a partner in when he started his PR business, since "50% of something is better than 100% of nothing." But when the business changed, the partner's role became less important, and John had to eventually buy him out.

You can listen to the story here (3:01).

Max Weinberg of the E Street Band: Not doing research in a real-estate transaction

From the April 11, 2008, issue of the Wall Street Journal.

In 1984, [Max Weinberg and his wife Becky] paid $300,000 for a five-acre farm that was part of a development, also in Monmouth County, and learned a lesson that Mr. Weinberg hasn't forgotten.

The Weinbergs bought the property, part of a subdivision, from the developer, who initially planned to keep the farm for himself. The developer seemed impressive -- he wore fancy suits and drove a Cadillac -- but he was deeply in debt and needed to make a deal, Mr. Weinberg says. But Mr. Weinberg didn't know any of that -- and he didn't dig into the deed records that might have revealed it. (Mortgages usually are attached to deeds.)

After the deal was done, the seller pulled Mr. Weinberg aside. "You paid me too much for the house," he told him. "I was up to here in debt. I needed the money."

"Why didn't you tell me this 10 minutes ago?" Mr. Weinberg recalls asking.

"That's business," the man replied.

In the end, Mr. Weinberg made money on the deal -- he sold the house for $590,000 in 1997, records show. But he knows he could have had the house for less, and he says he resolved never again to be out-researched on a real-estate purchase. He credits that lesson with helping him in later deals, from his current land, which he bought in a complex transaction involving a land swap with the seller, to a house he's considering buying in Tuscany, Italy, for which he has studied up on wild boar, a local nuisance. (They can burrow, he has learned, but they can't jump.)

"My whole thing has been research," he says. "All the answers can be found in city hall."

The principals dissect the failed AOL-Time Warner merger, 10 years later

The most powerful lessons can be learned years after a mistake is made. This is especially true with a colossal failure. Only after much time has passed can the people involved shed their self-protective impulses and see clearly what happened.

There has been much written (for example here and here) about the 10th anniversary of the failed AOL-Time Warner merger (AOL again became an independent company in mid-December 2009). But nothing has been as compelling and rewarding to read as this New York Times article recounting the history of the merger from the viewpoints of the principal actors involved. Did you know that TW CEO Gerald Levin and AOL founder Steve Case first met at the 50th anniversary celebration of the People's Republic of China? I didn't either.

Once back in the States, Case began his pursuit:

MR. LEVIN We’re now back in the United States and I think Steve Case called me on the phone and in that conversation more than alluded to putting the companies together. I had my traditional script and quasi-legal background that when someone calls you on the phone, make sure they understand you’re not for sale, which we certainly weren’t, and decline any overture, which I did over the phone.

And the story goes on from there. It's riveting, candid, and revealing, and a must read for anyone who is eager to do a big merger. It might make them stop and think a bit.

Textron Founder Royal Little stumbles by overruling his management

Royal Little (1896-1989) is one of the inspirations for this site. He was most famous for founding the conglomerate Textron (still going strong in 2011), but his most meaningful contribution for me was his autobiography, "How to Lose $100,000,000 and Other Valuable Advice." It's out of print now - but perhaps if someone who owns the copyright (it may very well be Harvard Business Press - but when I checked with them a few years ago they didn't think they did) falls in love with this site they'll reprint it. (I offer to write the Foreword!)

Little's book is an autobiography in mistakes. It's a wonderful upending of expectations - an exceptionally successful leader writing about everything he did wrong. It's a terribly human book, funny and sympathetic in a way that no chest-puffing "CEO memoir" ever could be.

Here's one of the stories from the book:

Homelite Four-Cycle Engine

In those days the only other well-known outboard motor company was Champion. Allan Abbott [head of Homelite, a Textron subsidiary] spent some time with them and tested some of their motors but decided against buying the company which, incidentally, had a negative net worth at the time.

A lightweight four-cycle engine was originally developed for the small Crossley car, which was to have been made right after World War II. Somehow or other the engine got to Twin Coach where its development was carried on further by Lou Fageol. Finally Twin Coach decided they couldn't handle it, so Lou Fageol and a partner, Crofton, took it over and carried on the development.

Lon Casler somehow heard of Lou Fageol and got enthused about their engine. In addition to the four-cycle outboard, Lou apparently had a design for an inboard-outboard motor and may have had a patent; and, of course, Homelite made a deal that involved a purchase and some royalties. This was done at my insistence with Allan Abbott objecting and predicting failure - but I was determined to get into outboards.... Incidentally, Lon Casler was Textron's acquisition vice-president and a tower of strength to me.

The lightweight four-cycle outboard engine had many advantages: it was much quieter than two-cycle engines, it eliminated the regular outboard's exhaust problem (it wasn't a "stink pot"), and the engine could be run efficiently at any speed. The owners loved them but it cost so much more than the two-cycle engine that the market was very limited.

The deal was made in 1957, but after about three months, Homelite concluded the project should be killed. But I decided that Homelite should continue - at least for another year - which was against their better judgment. Among our reasons for asking Homelite to continue was the fact that the engine had been featured on the cover of Textron's annual report. How's that for an excuse to continue a loser?

When we all agreed to let Homelite abandon the outboard business, Dick Fisher, who was the founder and principal owner of the Boston Whaler Company, was reluctant to see the engine go out of production, so he formed a new company, which bought it for some cash and some notes.

So the Homelite four-cycle engine was a hell of a development which lost a lot of money for a lot of people. Allan Abbott tells me it cost Textron at least $5 million.

Advice: Don't force a division president to take on a product that he's not sold on. He will undoubtedly know more of its potential than you ever will.

pp. 183-184

(c) 1979 Royal Little and the Harvard University Graduate School of Business Administration

Learning from a bad acquisition leads to success at Best Buy

There's a great mistake story at Strategy & Innovation told by Brad Anderson, former CEO at Best Buy. He discusses how they messed up a significant acquisition of mall record store Musicland, but applied those lessons to its subsequent market segmentation strategies, which helped the company emerge from the financial crisis as the leader in electronics retailing:

By 2000, Best Buy was reaching the limits of a growth strategy it had pioneered in 1989 with great success: selling consumer electronics -- computers, TVs, stereo equipment, and the like -- through noncommissioned sales staff in brightly lit, low-cost, free-standing “grab-and-go” stores. It was a simple idea, borrowed from the big-box general retailers, enabling Best Buy to radically undercut the leading competitors like Circuit City, which were operating according to the industry-standard business model: advertise loss leaders to get people into the stores and then use the talents of commissioned sales people to upsell to something far more profitable. 

Looking for avenues of growth, Best Buy could see potential in malls. Musicland, which sold CDs in malls, looked like a smart entry point. “We sold CDs; Musicland sold CDs,” Anderson explained. “We knew CDs were going to disappear; we weren’t that stupid. But we also knew an awful lot of product was being sold in malls.” 

The strategy wasn’t nearly that simple, of course. In 2000, Musicland was a $1.7 billion company generating about $100 million in cash. Since everyone knew CD technology was terminal, Best Buy was able to buy the mall retailer for a bargain price of $600 million. At the time, Musicland, like all the other music retailers, turned over its inventory twice a year. But Best Buy had learned to double that rate in its own stores, and sales had gone up. “So we thought, ‘Wow, how much cash could we create if we go buy the guy that sells it in the malls and move his turns, which were two, to four?’ ” If Best Buy could apply its merchandizing skills to Musicland to double its turnover, the theory went, revenue gains would pay back the investment quickly, and as CD demand declined, Best Buy could bring in its other products, which it could sell for far less than they were currently being sold in other mall stores. It looked like a no-brainer. 

But, as Anderson put it bluntly: “We misread totally what was going on.” Best Buy had increased turnover by decreasing selection, something its customers were apparently tolerating but Musicland customers would not. When the selection declined in the Musicland stores, sales dropped. What’s more, Best Buy initially maintained Musicland’s CD prices, which were $5 higher than at Best Buy stores. Customers assumed that if they were paying mall prices for CDs, they were overpaying for all the other merchandize Best Buy brought in, even though in reality the company was selling its other goods for the exact same low prices it was offering in its stores outside the mall. Dropping Musicland’s CD prices way down to Best Buy levels didn’t shake that impression, nor did rebranding stores under the Best Buy name.

Eventually Best Buy realized that it didn't understand deeply who its current customers were, and who its non-customers were. When they studied that issue, they learned that women, who shopped in mall stores, recoiled from Best Buy's selling proposition. With that knowledge in hand, the company retooled, and focused on female shoppers as a key buying segment. It was too late to save Musicland, which was shut down in 2002, but soon enough to re-energize Best Buy, the success of which drove its nearest competitor, Circuit City, into bankruptcy in 2008.

(Hat tip Rita Gunther McGrath)

A mistake story from Interface CEO Ray Anderson: Be careful using other people's money to make acquisitions

[This story is from Ray Anderson, Founder and Chairman of Interface, Inc., a manufacturer of carpeting and fabrics.]

When we began [Interface], I made the initial investment personally. And then friends came in, then a much larger partner joined in, and we eventually financed the company. And, by the way, the day we had our finance all in hand is the day we count as the birthday of Interface. Up to then, everything is conception and gestation, beginning with the gleam in my eye, perhaps the idea; but it’s only when you have your money in hand that you can truly call yourself a company. And that’s the birthday.

Interface, after getting through that treacherous startup, in the teeth of the worst recession since 1929, really hit a home run year after year, 70 percent compound growth. And then ten years later we went public, and for the first time had access to other people’s money. Investors who bought shares in the stock, our expanded capital base of Interface, enabled us to begin to make acquisitions, and we made acquisitions in Canada, in Northern Ireland, and eventually in the United Kingdom and in Holland. And then in 1998, when the company was fifteen years old, we were a global company. Then we made other acquisitions, made subsequent stock offerings to the public, and had people subscribe to the stock and further expand the capital base, which enabled us to do more. We leveraged other people’s money time and again over the years, so much so that it got to be a little too easy to access it.

And then we made a concentrated series of acquisitions to create a downstream distribution system. We made twenty-nine acquisitions, over a very short period of time, of contract dealers, the people who install and maintain their products. We wanted a captive, owned distribution system, and we invested $150 million of other people’s money, basically by selling stock and doing bond offerings. And it was too easy.

If we’d been spending our own money, we would have thought very hard about those acquisitions. In the long run, they turned out to be a mistake, and six, seven years later we began to dismantle this distribution system and liquidate it, selling the businesses back to the owners or back to the employees. And we might not ever have undertaken that unfortunate series of investments if we’d been investing our own money. We would have questioned it.

Reprinted by permission of Harvard Business Press. Excerpted from Lessons Learned: Straight Talk from the World’s Top Business Leaders--Starting a Business. Copyright (c) 2008 Fifty Lessons Limited; All Rights Reserved.

James McCann of 1-800-Flowers on recovering from poor due diligence

From the New York Times, Sunday March 16, 2008, an interview with 1-800-Flowers.com CEO James McCann:

In 1986 I bought the assets of a failed floral company in Texas called 800-Flowers and took that name. I thought I was smarter than everyone else and neglected to hire lawyers and bankers to do due diligence. I unknowingly signed for all liabilities, which I later learned was a debt of $7 million.

People advised me to file for bankruptcy. Then my grandmother took me aside and said: “This bankruptcy thing? We don’t do that. Find another way.” I worked like an animal to get out of that hole....

If you look at highly successful people, they make the same number of mistakes as others, but they recover quickly. They don’t sit around moaning about what they’ve done wrong.

A more complete retelling of this same mistake can be found in this article in Inc Magazine.