Shared by Gregg Yorkison of Clare York Group.
There are a lot of potential successes out there with cutting-edge technology and finance. Cryptocurrency, blockchain, and fintech companies all have the capability to create success stories and bring wealth to shareholders, investors, and creditors. However, Gregg Yorkison notes that, as with all fledgling and even some established endeavors, that isn’t always the case. For the companies that don’t survive, things can seem dismal. Thankfully, there are options for exiting with the least damage possible. That is where companies such as Clare York Group Los Angeles. come in. Clare York Group, led by Gregg Yorkison, is a boutique advisory firm headquartered in Los Angeles, California. The firm was founded in 1999 to provide services to mid-market companies. They provide restructuring and M&A services, assisting and in some cases acquiring companies that are seeking a resolution with lenders, creditors, or other entities.
Why cryptocurrency and fintech companies fail
According to Gregg Yorkison of CYG, nearly three in four new cryptocurrency, blockchain, and fintech companies fail, including those with venture capital. So, what is it that makes them go the route of so many others? Techtic lists the twelve biggest reasons, and they all start to seem fairly obvious in retrospect. The Techtic list includes:
- Not getting enough original funding to survive
- Choosing the wrong venture capitalist (VC)
- Spending too much time, effort, and money on compliance
- Using the wrong business model
- Using discounts as a method of staying competitive
- Underestimating the competition
- Not understanding the customer base
- Overloading product offerings
- Not taking advantage of the right technology
- Having an unclear or poorly designed revenue model
- Not doing enough research on the legal aspects of running a company
- Choosing the wrong development partner
Image credit: Burak Kebapci
What C.Y.G. can do in these cases
Sometimes, it takes a few failures before you get to success. Clare York Group Los Angeles understands this and helps to remove the burden of a failed enterprise so that you can move on to the next thing unencumbered.
When it comes to failed cryptocurrency, blockchain, and fintech companies, they have a plan. Gregg Yorkison of Clare York Group explains:
“We have two roles for these companies. We can either remove the burden by acquiring the company’s stock or provide our services to wind things down via Assignment for Benefit of Creditors (ABCs) or foreclosure. By doing this, we can help to protect venture funds and provide some return for creditors, helping to retain your good name and standing in the fintech community despite the setback of a failed company.”
Looking for the next success story
If you ever need a little inspiration to remind yourself that when one door closes, another one opens, consider this story of these bankrupt fintech founders who started again and raised 2.5 million euros (roughly 2.8 million USD) to fund a company focused on helping other SMEs to stay in business:
“Likvido was founded in 2018, less than a year after Maximillian Frimmer and Lars Holdgaard went bankrupt with their first start-up due to a cash crunch caused by inefficient invoice management. The experience led the pair to develop an automated process for managing and collecting invoices in a faster and more user-friendly way. In the two years since, the firm has signed over 2000 SME clients, who are estimated to save 80% of the time allocated for debtor management and receive their invoice fees 20-50% faster than normal. CEO and founder Maximilian Frimmer says the firm intends to use the seed funding to become ready for a series-A round and international expansion in twelve months.”
– FinExtra
Image credit: Buro Millenial
