A few weeks ago, my company suddenly died. The autopsy results are still pending and people will analyze, hypothesize, guess, and make things up about what was the cause of death, but it ultimately doesn't matter. The result is the same: the company is dead.
So I will let the analysts, reporters, conspiracy theorists, and others mull around the reasons for why a successful company and product with a strong vision and a healthy customer base had its life support just pulled out. This post will focus on the future and the lessons learned.
Since an overwhelming 75 percent of startup companies suffer a similar fate, it isn't uncommon that people in this space will have to endure a series of events like my colleagues and I have gone through in the weeks following the abrupt death of Optify. So what do you need to do when you hear the news?
Image Source: Statistic Brain
The first natural reaction is to freak out and run for the fences. Update your LinkedIn profile, call the bank, cancel all your un-needed subscriptions, and make sure you have enough money to survive the next few days.
But while all these actions are necessary at some point, they probably aren't the right ones to start with, especially if you're in a management position in the company. You first need to take care of a few groups of people.
Take Care of Your Employees
First and foremost, you need to take care of your employees. In an abrupt situation like we experienced, it isn't as simple as it sounds. Most people would say that you need to let everyone know right away and there's no reason to hold the information. Most people would be wrong.
If you really want to take care of your employees, you will try to let them know as soon as possible but have everything in place for them before you let them know. Severance packages, medical coverage, contingency plans, recruiting services, process to handle and help them, and legal documents for them to sign. It takes time to have all of this ready.
In order to have all of this in place when you make the announcement, you will need to withhold some information from them and get all your ducks in a row. It's easy to just let them know and not keep this secret from them, but it will be a huge disservice to them if you do that. Remember, once you make the announcement, there's no way of controlling it any more.
Our executive team worked tirelessly to make sure everything was in place before they made the announcement. They:
- Took care of severance packages for the entire company (not a simple achievement).
- Made sure medical coverage will stay and contingency plans are in place (extremely important when you have employees with pre-existing conditions that rely on your medical coverage).
- Invited a recruiting firm (the great Dynamo Recruiting) to help all employees with new positions.
- Had legal documents drafted and reviewed to ensure proper release and no liability; and they worked on messaging and communication plan to ensure messaging alignment (what do I tell my friends? What do I tell other companies? What do I tell my vendors?).
Take Care of Your Vendors
If you're a marketer, you're working with at least five vendors at any given time. While your company will cease to exist, that doesn't mean you'll never work with the vendors again during your career. You need to make sure you take care of them.
Ask your vendors for their final invoice, notify them on what's coming up, give them your contact info, and try your best to get them paid. It's not always possible in situations like this, but if you can, they will greatly appreciate it.
For me it was more like 15 active vendors and 15 more not on active contracts. That's a lot of vendors to handle in a very short time and with some of them, it was just too late.
How to prioritize? For me, it was more about the size of the company and the relationship with the vendor. If they are small (like a one-person shop), I tried to take care of them first since I knew that that invoice could make or break their business.
Take Care of Your Partners
When do you let your partners know you're going out of business? With almost all of our partners, I waited until after the announcement and then sent a very impersonal mass email to all of them with the boiler plate we came up with and an email address to send more questions to. While their business wasn't relying on our existence, I thought it would only be fair that they hear the news from me and not from the unavoidable blog post or social media chatter.
I received an overwhelming amount of supportive responses. It proved to me again that at the end of the day we deal with people, not faceless organizations, and these people were compassionate and extremely supportive.
Take Care of Your Assets
As a marketer, you produce a huge amount of digital assets – website, social channels, white papers, guides, presentations, videos, blog posts, comments, directories, leads, lists, emails, and more. In most cases, when a company "expires" those assets are being sold or delivered to the buyers or creditors, but a lot of those assets probably have some linkage to your name and/or email address.
For example, LinkedIn ads: in the past, you could only connect a LinkedIn ad account with a personal account (not a company page), thus creating a virtual connection between a person to an entity.
Make sure you untie all these connections between your digital assets and the company's. It's important to your digital reputation and for your peace of mind.
Take Care of Your Customers
I think it's obvious that you would like to take of your customers, but how do you do that? In most situations of layoffs, merger, acquisition, or plain bankruptcy, the creditors will make you sign a non-disparage clause that will prevent you from even reaching out to customers not too mention letting them know about the plans for the company. This is a standard process designed to protect the buyer and/or the creditor and in most cases they will make your severance package linked to that document.
But if you've done your job well, you built and developed close relationships with some customers (especially if you're on the sales or support team). In some cases, you might even have a daily interaction with them, so how do you handle news like that? There are several options and none are good (it's not really a "good" situation anyway). You can:
- Hide behind the company's boilerplate message or just completely stop communication.
- Send them to a blog post or write a vague email letting them know you are "no longer with the company" and then face their questions on your personal email (if you wish to give them one).
- Just hope that the company will communicate something quickly to all the customers so you don't feel the need to respond to blog comments, Facebook posts, and Twitter chatter.
In any case, there's no good solution for taking care of your customers in a situation like this. The best you can do is to be as honest as you can possibly be within your legal limits.
Take Care of the Media
The media will know fairly quickly. Whether it's a blogger, a reporter, or a social media enthusiastic, someone will write about it and the word will get out. In today's connected world, it's almost impossible to keep a secret.
So in order to be in front of the problem, make sure you're ready to handle it and try and control the message. It's important to do so to protect your employees (read: former employees) and also to protect the buyer/creditors.
Have a boilerplate message ready, write and publish a blog post or a news release, or even reach out to your media connections to make sure you control the story. But remember, once it's out there, you can't really control it.
You might be in a position in which you have no choice but to ignore the media. If you are legally bound to not talk to the media, you will have no choice but to ignore it.
Take Care of Yourself
If you're done taking care of everyone around you, it's time to take care of yourself. You will need to think about three aspects of your career: your past, your future, and your family.
Take care of your past by reflecting on your work at the company – what you've done, the success stories, as well as the failures. Write down your experience and collect feedback from your former colleagues (and ask for LinkedIn recommendations). It more than likely that you will meet some of the people you've worked with again, so take them time to nurture those relationships and end them on a positive note.
As for your future, it's time to hit the pavement and look for your next opportunity. The best advice I got was that you need to think about the job after the next one when you look for a new job.
Find the opportunity that will put you in a position to get the next job you want. With the lessons you've learned (and the experiences you gained) you are now more equipped to evaluate opportunities in a different perspective. And while it's not optimal to search for a job when you're out of a job (as the saying goes – it's far easier to find a job when you have a job), don't jump on the first offer that comes along.
And lastly, take some time off and take care of the people who really matter in your life – your family and friends. If you are like me and you've put your heart and soul into your job and got great support from your family, it's time to pay them back with some attention.
Don't Freak Out!
Change is never easy, but it's always good. So make the best of it.