Friday, May 24, 2019

How to pay a big debt and not go insane: 5 rules for entrepreneurs

Life Hacking

How to reduce spending and develop a payment mechanism and why it is always better to start one’s own business alone.

We started the first business almost seven years ago. Before that, I drifted, working for hire in a variety of roles: from the teacher of ballroom dancing to the SEO-optimizer. The last and it became my business, and without long foreplay: there were people, came up, played enough and withdrew from control. I and the director became equal partners, with the traditional 50 to 50.

The case developed, even rented the office closer to the center. Three times we collected and dispersed the sales department. The work moved to the morning meeting and co-coffee with discussion of plans. The process took about 2-3 hours a day. Not business, but a holiday.

The problems started when I decided to launch the second direction – video production. I did not like the partner: I spent less time with the joint company and generally began to take independent steps.

We cursed for a long time, and eventually he decided to leave. I demanded compensation – almost two million rubles. They issued a receipt, allegedly he lent them to me.

Six months later the ex-partner filed a lawsuit against me. The process lasted two years, and now we owe each other a seven-digit figure.

I remember very well the moment when the amount became real – I could not pay dinner in a cafe with a single card. I checked the Internet bank. I saw a balance on the screen – minus two million.

A wave of fear and panic immediately rolled over. Such a real animal fear. You can not give in to him.

What I really need to do, I had to deal with myself.

Rule 1: Do not be afraid

Fear pushes on rash steps, especially if creditors are crushed. In my case, there was even extortion and attempts of blackmail.

Try to call the closest person and arrange an appointment. In my case it was my father. Strictly forbidden to remain alone. It is possible to heal irreparable mistakes.

Tell everything as is, without embellishment. Further actions you should discuss together: letters, calls and any steps need to be thought through with all the possible risks.

You will see, it will instantly become easier.

Rule 2: analyze the situation

A very important process that needs to be carried out – determination of the depth of the problem. The algorithm is as follows:

  1. We postpone all urgent and important cases.
  2. We warn relatives of the temporary inaccessibility.
  3. Turn off the GSM connection and all the alerts on the phone.
  4. Turn on background music of relax-format.
  5. absolutely all indebtedness.

The important point is the perfect format for Google Sheets, since you need to have a separate tablet that will always be at hand.

Most likely, it will be emotionally difficult. You will try to lose some of the debts under the sauce “well, it’s for Mom, this is for Dad, you can not write …”. No you can not. We write everything, this is important.

Rule 3: go through the phases of acceptance of the inevitable

In the phase of negation you will use all means of escapism – aimless hangs on the web, games, serials. You can not do this. We pull ourselves out of this state. We need to feel the point at which we are, otherwise this destructive phase will permanently cover.

Anger will be. Do not extinguish it, it is relaxation. Of course, to a reasonable extent – do not overdo it and go to the physical manifestations of aggression.

Bidding is dangerous. It is at this phase that you will replace the real picture of the illusory: yes, like not such big debts, everything seems to be given up, everything is normal. No. Not in norm. We throw ourselves away from the comfort zone.

Only then will humility come to us : I know where I am, I soberly understand how to act, I’m moving forward towards a plus balance.

Rule 4: do not pay too much

Since, most likely, your receipts are irregular, you must first get rid of the maximum possible number of regular payments so that the amount of debt is not enforced.

Penalties, fines, fixed payments, user fees for using services – everything must be filtered through the shallow water

If you need to keep a business, use the Pareto principle:

  • only 20% of your customers bring you 80% of the profit;
  • only 20% of your customers load 80% of your working day.

Important: Profit – this is the amount of live money that you directly put in your pocket.

For two years I could not understand that I had mixed up profits and proceeds. When the error was found, six of the eight clients were transferred to the partners’ reliable hands. As a result, the work day was unloaded almost completely, and the loss of money did not exceed 25%.

If you still have employees, try to agree on piecework or hourly payment. This scheme will be more profitable for both parties, and the main advantage is likely to be a cardinal improvement in labor productivity.

Rule 5: Develop payment mechanics

Next, you need to estimate the minimum possible income, subtract the amount from the provision for life support, and the remaining volume means to take for the resource of liquidation of debts.

This is the same resource should be proportionally divided into each segment of debt obligations. For this purpose, I have a separate tablet on Google, where there is a total debt amount and specific recipients.

Works by the formula:

The amount of the specific payment = the amount of the receipt × the life-cycle ratio × ((the amount of the specific segment / (total debt amount / 100)) × 0.01).

It’s hard, let’s concretize.

  • The total amount of debt – for example, 1 million rubles.
  • The liquidation factor is 0.2 (this means that 20% of the personal receipts are sent for the liquidation of debts.)
  • The amount of a particular segment is 250,000 (for example, (19659018) The amount of income is 30 000 (for example, someone gave it, miracles happen).

It is necessary to understand how much to pay to the contractor:

30 000 × 0.2 × ((250 000 / ( 1 000 000/100)) × 0.01) = 1,500.

The table should read the sum automatically. We drive into the appropriate cell the amount of income – and we pay what happened.


Finally I want to give some tips on how to avoid such a situation or at least minimize the consequences. Each point below is supported by my mistakes, messed up nerves and lost money.

1. Do not skimp on lawyers

In my practice, three specialists refused to conduct business. With different wording, but the reason, most likely, was the lack of prospects for winning – and why to spoil your rating.

A competent lawyer will not give any guarantees. On the contrary, during the consultation phase, he will prepare you for the worst scenario. But if he does it, you must feel the reinforced concrete power in every word and gesture.

I’m not romanticizing, it’s really very important. Any court, especially for the first time – terrible stress, and your main weapon should be Jedi peace and confidence in your rightness.

2. Do not rely on bankruptcy

There is an illusion that a relatively fresh regulatory framework for the bankruptcy of individuals allows you to legally jump off the payments of debts, loans, fines and penalties. Is it worth explaining that this is not so?

Most likely, you can not officially work, and all your property will, with rare exception, go to the so-called bankruptcy estate to pay off debts. In addition, bankruptcy is not at all a cheap procedure, and the result is often unpredictable.

Avoid this, at the very least, carefully select a specialist.

3. Do business yourself

The partnership should always be mutually beneficial. In this case, often the first business is created in the partnership for only one reason – because of the principle of shared responsibility.

There are two possible outcomes:

  • the partner-leader will be crushed by the authority of another;
  • the tandem will disintegrate and the proceedings will follow.

the partner can be only one. The rest should only be interested in strictly stipulated periods whether the company leaves the break-even point, whether everything is according to plan, when profit and whether assistance is needed.

Well, most importantly. It’s just money, do not do anything stupid. And yes, common sense stores you.