Complexity Hides Fragility: Losing a $20m Business

So you guys buy. Tell us to pick us up from getting in there.

Yeah. So very, very exciting. It's almost to the day that we closed. It was December, maybe 11th somewhere on there.

My family was still back in California, and I was here in the Dallas area closing on this business. And so it's funny, when it's all closed electronically like it is, you kind of like, okay, it's over, and tomorrow I'm showing up to work. I guess this is really weird, the feeling.

Yeah, I bet.

So we started showing up every few days and. Or every day and. And going through the process and transferring things over. My focus was more mapping systems and processes, understanding making sure we.

We understood if anything went wrong, we understood the business from every step, from, you know, when we get a referral all the way till we get it out the door and servicing the patient. And so that was really my job, just really understanding the operational flow. Jess is focused on corporate control and making sure all of that transferred control was in her hands.

You know, obviously, it's a requirement from the bank, and whenever you take over company, you have to make sure you actually have control of it. So she's working on that. And within probably about two to three weeks, right at the end of the month, end of the month of December, Jess is like, we are really short on cash.

And I'm like, what? What do you mean? She's like, well, things aren't coming in as fast as they used to, and we've had additional expenses that we're trying to weed through. And we'd started with just under $2 million in working capital. Looking back, not enough.

Whatever you think it is, you need twice as much. We've seen it happen with a lot of companies. They're just things that pop up out of nowhere that you want to have capital to deal with.

Um, but we stretch out payments. You know, the company at the time had terrible process, so they were paying immediately. Whenever a bill came in the door, they just pay it.

And so we bumped everything to net 30, buying us some additional time there. Some people had problems with it, but, you know, they eventually will get in line because it's pretty standard. So we started doing that.