I’m not a big Sherlock Holmes fan. Some of the stories are amusing, but I never really warmed to the character. (I do like Arthur Conan Doyle’s science fiction and suspense stories, but that’s a separate conversation).
Anyway, about Sherlock Holmes. He used to have a saying that “Passion was the enemy of precision.” And it can be, certainly.
But other things are enemies of precision, too. One of them is more insidious than passion. It is delusion.
What is delusion?
Delusion is the failure or inability to see the reality that is before our eyes. Delusion is the blocking out of information that does not conform to our pre-existing beliefs.
Delusion is all to common. It can be a killer.
I, like many others, like to read about entrepreneurs and how people make great things happen in business. It’s important to be positive, optimistic, and confident in everything we do in life. But what often goes unnoticed is this: for everyone to starts a successful business, there is a greater number of people who have serious problems with their businesses.
Everyone loves to talk about rah-rah, feel good things. But no one wants to talk about how bad things can happen. And what to do when they do happen.
I know what you’re thinking. You’re thinking that they must have done something wrong. You’re thinking that if only they had done this or that, then everything would have been different.
Maybe. And maybe not.
Anyone can be hit with hard times.
Let me tell you something. Anyone can fail at business. As an attorney, I help businesses and people reorganize and restructure their troubled businesses. I’ve been doing this for a long time. And let me tell you: bad things can happen to anyone at any time. No one is immune.
No matter how great they think they are. No matter how clever they think they are. The world will teach them, too. Yes, those guys too. The ones you think are kicking ass in everything 24/7.
Medical problems can come along. Personal problems can come along. Shifts and changes in the landscape can change everything.
So what do you do? You learn to spot delusion. Delusion is the enemy of problem-solving. Delusion is what prevents you from solving the problems you need to solve in your life.
The biggest problem I see in the business restructuring world is this: business owners wait far too long before they get help. They procrastinate. They pray. They live in denial. They indulge themselves in wishful thinking. They don’t listen to good attorneys or accountants.
And they make a bad situation much worse.
When you see problems starting to develop in your business or life, don’t wait. If you are a business owner and see things starting to south, you need to see a bankruptcy or reorganization attorney right away. I know you don’t want to hear this. But try to keep an open mind.
A Chapter 11 bankruptcy, for example, is one of the most powerful restructuring tools out there. It’s only one of many tools, but I’m just using it as an example. It’s there for you to use, if it’s an appropriate tool for your situation. But delusion can blind people.
They believe all the bullshit about how reorganizing their business in court carries a “stigma” with it. They find it hard to accept that bad things are happening. They find it impossible to admit to their friends or family that they need help.
And of course, this only delays things. It makes a bad situation worse. And the paradox is, it becomes a self-fulfilling prophecy. For by not moving quickly to solve problems, they generate the very outcome that they feared most.
I understand that it’s natural. Business owners pour their hearts and souls into their businesses. It can be a crushing blow to have to admit that they need to take a new direction.
But believe me, it is worth it. I’ve never had a single business or individual Chapter 11 client ever regret reorganizing. Never. Not once. If anything, they feel a tremendous psychological burden has been lifted. There are other bankruptcy chapters that can be used, also. And there are non-bankruptcy alternatives that can also be used, if those are appropriate.
So the first lesson is: get help. And get it fast.
Get help from someone who lives in your geographic location, who knows the applicable law, and who has experience. You need to be talking to accountants and attorneys who know what the hell they’re doing.
Because trust me, those little cutesy games you played when you set up your business aren’t going to help you. They’re not going to give you the protection you think you have. A determined creditor can go right around all those little LLC games and asset games you read about on the internet.
They’ll go after you personally, whether it’s right or not. They’ll hire skip tracers to find out where your things are. If they want to get at you, they will.
It is important to act with speed. The minute you see things going south, you should be getting qualified, competent advice. Don’t wait. As painful as it is, you need to do it.
So, realize that you need the help of true professionals, not amateurs. This is lesson number two.
Lesson number three is to listen to those professionals. Don’t let your pride, or your delusion, prevent you from taking action. This is one of the biggest mistakes I see people make.
You don’t know what you don’t know.
Even lawyers hire other lawyers. And there is a damn good reason. Because you don’t even know what you don’t know. You might think you know what’s going on, and get blindsided with something totally unexpected. It happens all the time.
All the time.
Some people think they know more than the professional. I see it now and then. And these are the ones who fall the hardest, and fastest. They won’t listen. They think they know something because someone they know said this-or-that.
Well, you can’t help everyone. If someone is not willing to listen, let the world teach him. And it will.
Don’t beat yourself up too much about these things.
This is lesson number three. Everyone runs into hard times. Everyone needs help reorganizing sometimes. No one is immune. The problem is that people spend a lot of time talking about the exhilaration of starting a business, and not enough time talking about “emergency first aid” as we can call it.
You will come out of this sort of hardship smarter, wiser, better, and stronger. It really is true. You can’t see that now. But just take it from me.
Don’t listen to your delusions.
Delusion is the enemy of precision.