Are you still deemed to be successful after going into Liquidation?

LiquidationWhy do I ask? Is my business in trouble? Hell no. But today I went to a Business Chicks breakfast where I heard from America’s original #girlboss Sofia Amoruso.

She started the Nasty Gal empire along with a bit of a Girl Boss revolution in America. She has a podcast, fashion empire, books, soon to be released series on Net Flix – amongst other things. Well that was until a report came out today that Nasty Gal is going into liquidation.

Now before you all get your knickers in a twist about the phrase “girl boss” – basically what she is referring to is that she wants girls to grow up believing they are in charge of their own destiny, they can be the boss of their own lives and if they choose, they can even run their own business and be a boss.

Sophia has had one hell of a ride, from being quite directionless in her choice of future to jobs she hated (when she worked for others) – to then building a budding online business selling vintage clothing into the Nasty Gal empire. No initial funding, no Harvard Business degree, no formal qualifications in building an empire – just true grit in finding bargains and selling pieces of clothing people wanted. This in turn led to a multi million dollar business and featuring in Forbes list of richest self-made women (and she even appeared ahead of Beyonce at one stage). And god only knows what else this amazing woman has achieved.

Then later today, after I was still glowing from getting her to sign her new book for me, Nasty Galaxy – a visual book filled with total bad arses (her words not mine!), there were links all over social media stating that Nasty Gal was going into Liquidation. Boy, were once staunch supporters of her “story” going into meltdown. And fast.

Yes, it is unfortunate that the story was released during her Australian publicity tour with Business Chicks, but my question to all those who are quick to judge is this:

Does going into liquidation suddenly make her unsuccessful? Do we disregard this woman received approx $50 million in venture capital? Do we ignore she built a business from scratch on her own with no initial debt? Does that suddenly vanish overnight?

My thoughts are no, and here is why:

1. Her story is inspiring, relatable and just freaking plain kick arse. She worked hard with very little knowledge, to grow a business from nothing into millions of dollars, employing hundreds of staff. Someone doesn’t get to that stage without guts, determination, a take no prisoners attitude and a never give up sense of understanding her market. To that I give her huge credit.

2. She personally is not going bankrupt. Her business is filing for liquidation. Now I am the first to put my hand up and state I am not an international tax expert, nor am I an expert in USA liquidation – but I do know this. She was not the CEO of Nasty Gal at the time of liquidation. Obviously some bad decisions have been made to get to this point, there is no denying that – details of which I am not privy to (nor should I be privy to). What I am saying is that in an organisation that size, there are many people responsible for getting to the stage of liquidation and they should all be taking this on their shoulders and planning for the future direction of Nasty Gal.

3. They have debt and want funding and are doing what they can to achieve this. From my understanding there are cash flow issues and they seek more funding for the future. However, as an entrepreneur myself, I know how hard it is to get funding. Let alone to get funding with existing debt and cash flow problems. So if they go into liquidation, the debt can get reduced (to a degree), they work on a repayment plan, and they can start again. OK – so this is a HUGE simplification of the scenario, but my view is that they are still positive of an answer as to how they can continue to operate – they are thinking ahead.

4. Let me list some brands and people that have gone into liquidation or bankrupt and you decide if they are total failures, or if they have some skills, knowledge and lessons that they can share and we can learn from. Ernest Hillier (chocolatier), Wendy’s (ice cream stores), Pumpkin Patch (retail), Poppy King (cosmetics), Dick Smith (electronics), Donald Trump (several times), Billy Joel (Musician), Kim Basinger (actress), Walt Disney (Film maker) & Abraham Lincoln (former US president). To me, these people have all been successful and are still successful in their own right.

So here is the kicker – in America, your business can go into liquidation so you can restructure, reduce debt, arrange repayment plans and the business can continue on (so people keep their jobs). This is not illegal. People like Donald Trump has made this “restructuring” a regular thing and even during his political campaign stated :

“Out of hundreds of deals that I’ve done — hundreds — on four occasions, I’ve taken advantage of the laws of this country, like other people”.

So despite the Nasty Gal liquidation announcement, do I feel that Sophia Amoruso is any less of a success? Do I feel her journey any less amazing? Do I feel that she is no longer a role model to young girls aspiring to kick arse in business life? NO – absolutely not.

I think the management of Nasty Gal was missing some vital analysis, so during the liquidation and restructure I think this is something they will need to focus on to come out the other side stronger – but to me, she was, and still is the original #girlboss.

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