The two most vital components of entrepreneurship are management and risk-taking. This means that to do well in business, one must be prepared to take big risks. Sometimes taking risks can lead to failure and cause one to become bankrupt, and though this nightmare scenario is the last thing anyone in business wants to think about, being unable to pay one’s debts is a reality for many entrepreneurs.
Regardless, bankruptcy is not necessarily a financial death. There are a number of successful individuals who have filed for bankruptcy, only to bounce back financially and in the case of some, create an empire.
Check out the stories of five successful businessmen who declared themselves to be bankrupt but lived to tell the tale.
As an animator, voice actor, film producer and founder of The Walt Disney Company, Walt Disney is perhaps the most influential figure in American entertainment. What is not widely knownhowever, is the failure he faced in his first attempt at entrepreneurship.
In 1922, Disney started a film company with a partner in Kansas City called “Laugh-O-Gram”. They made short advertising films and cartoons with a camera that they had bought second-hand. Sadly, a deal he signed with a New York film distributor resulted in a betrayal that left Disney and his studio penniless and bankrupt.
Not to be deterred, Disney bounced back in style in 1928, when he introduced a new cartoon character that went on to become one of the most iconic and well-known figures in modern history: Mickey Mouse. This kicked off the start of his illustrious career and magical legacy that went on to include The Walt Disney Company and its theme parks.
Despite his initial failure, Walt Disney possessed a net worth of $5 billion at the time of his death.
As the creator of many iconic heroes in the Marvel Comics universe such as Spider-Man and the Avengers, Stan Lee has emerged as the most prominent figure in the comic book industry.
Following his service in the US Army during WWII, Lee experienced early success when he co-created The Fantastic Four and The X-Men with artist Jack Kirby under the Marvel Comics banner. Twenty years into his career, Lee became the creative head of Marvel Productions Ltd., continuing his ascent to comic book god status until Marvel filed for bankruptcy in 1996. Following this, Lee’s contract was terminated, though he retained the position of chairman emeritus at the company.
In 1999, he formed Stan Lee Media, but the company went bankrupt shortly after in the early 2000s. His unfortunate streak came to an end in November 2002 when Lee successfully filed a $10 million lawsuit against Marvel for not receiving any profits from the first Spider-Man film. The legal victory in 2005 allowed him to emerge from bankruptcy.
Currently, Lee’s net worth is $50 million but what may surprise you is that he doesn’t make a cent from some of Marvel’s most recent projects, including both Avengers films that earned over $1 billion respectively. “I hate to admit this, but I do not share in the movie’s profits. I just share in the interviews, in the glamor, in the people saying, “Wow, I love that movie, Stan” — but I’m not a participant in the profits.”
The Hershey Company is perhaps the most well-known confectionery brand in the United States. However, its road to success was far from smooth for its founder, Milton Hershey.
Hershey apprenticed in a candy shop for four years before beginning his own shop in Philadelphia in 1876. By 1882, Hershey’s shop was bankrupt, and his subsequent attempt to peddle candy in New York City was just as unsuccessful.
His return to his hometown Lancaster, Pennsylvania marked a change in fortunes and the beginning of an illustrious career in confectionary. He founded the Lancaster Caramel Company in 1883, ingeniously pioneering the use of fresh milk in caramel production.
Seven years later, Hershey sold the caramel company for $1 million in order to focus on the formula for milk chocolate, and went on to perfect the iconic Hershey’s milk chocolate bar.
The Hershey Chocolate Company has had such a great impact globally that Forbes placed the firm at #94 on its list of The World’s Most Valuable Brands.
Hershey himself had a net worth of $150 million by the time he passed away in 1947.
Donald Trump may be the most ubiquitous and controversial candidate running for the U.S. presidency, but what he was first known for was his success in real estate development. However, his business empire suffered multiple setbacks throughout his career.
In 1990, various banking institutions that had backed Trump’s real estate ventures had to bail him out with a $65 million “rescue package” that included new loans and credit. Less than a year later, the real estate mogul was in nearly $4 billion in debt. His ventures in the hospitality industry didn’t fare much better, as the Trump Taj Mahal Casino declared bankruptcy and had to be acquired by billionaire Carl Icahn, who invested $20 million to keep it afloat.
Trump’s financial troubles continued throughout the early 90s, when his personal leverage hit nearly $1 billion. In 2004, Trump Hotels & Casino Resorts also filed for bankruptcy, forcing him to pay $72 million out-of-pocket to keep it afloat. In 2009, the same company (by then renamed Trump Entertainment Resorts Inc.) filed for bankruptcy again.
Despite al of this, Trump has brought himself back from the string of failures and he is now currently said to be worth $4 billion.
Henry Ford’s mastery of innovative production techniques revolutionized the world and resulted in an automobile empire that is the Ford Motor Company. Nevertheless, despite being the founder of not one, but two iconic American car manufacturers, Ford’s career path was not without pit stops and stumbles.
In 1899, the engineer and mechanic started the Detroit Automobile Company with the backing of three prominent politicians. However, his perfectionist nature resulted in painstakingly slow production, producing only 20 cars in the two years after its founding.
The company went bankrupt in 1901 and was reorganized into the Henry Ford Company later that year, which was later renamed the Cadillac Automobile Company after Ford left the enterprise.
Ford went on to found the Ford Motor Company in 1903, ultimately ending up with a mind boggling net worth of $199 billion (inflation adjusted) by the time of his death.