How 1 SBA Loan Brought Down 2 Businesses

We still got a ways to go here, Edgar. That was. So that was the collapse, frankly, of Dallas before we leave that piece. So what does it look like to shut down the business?

Like, what are the financial implications of that? Servicing the debt going forward? Losses, no more profit coming out of the business. I mean, what was that analysis?

At least the SBA will cover whatever, 80% or something. Matthias making the decision was we were always modeling out what our Runway is and what our burn rate is and how much we're spending versus how much is coming in. The sudden drop in sales kind of was hard to plan for.

And so the decision came, like, pretty abruptly, like, hey, this is not going to work. Matias actually put in additional capital, not to mention the fact that the attorney's fees for the prior case was way more than. Than we ever anticipated, needing to spend or wanting to spend.

And so it. It's one day, hey, this isn't working. We're gonna. We're gonna shut. In fact, actually, we. Matthias was willing to put in an additional.

I don't remember, maybe $200,000 to see us through for a period of time. And we had a conversation with the then CEO, and we're like, hey, is this enough? Like, what do you think?

And he was very honest. He was like, I don't think that's enough. And so we said, okay, then there's no use, you know, throwing good money after bad.

We shut down. There's things I wish we would have been able to plan for better. We left a couple of projects unfinished, which I think is ultimately really unfair to the client, the homeowners who. Who had nothing to do with it.

Yeah, some got a good deal in the sense that we were 70% complete, but we had only collected a 50% deposit. Others got paid a deposit and didn't get anything. Yeah, then, you know, obviously they become creditors, and that goes through the trustee, the bankruptcy process is painful.

There is some sort of like sense of relief to where once the trustee takes over, you hand them all the documents, you answer all their questions and they just kind of take over and they're, you know, gonna sell whatever needs to be sold to, to take care of whoever can be taken care of. So you don't, you're not actually constantly involved. After a few weeks you're just kind of stepping aside.

Regarding the SBA debt though, we always had this. We knew that structure had, you know, signed the, for the Dallas acquisition and structure was the businesses were cross collateralized. Our lawyers had a hard time expl.