Success isn’t always a straight line although many of us tend to think it is. There are lots of highs and lows and many obstacles to overcome. Just ask some of the most successful companies in the world – they’ve had their fair share of coming close to calling it quits. Fortunately, many of them managed to pull through, but you’ll never guess some of the big names that almost went belly up.
1. The Walt Disney Company
Can you believe that the Walt Disney Company was on the brink of bankruptcy, not once, but twice? The first time was in 1920 when their financial backer went bankrupt himself, then a second time in 1937 after the creation of their first feature length film, “Snow White and the Seven Dwarfs.” Although it was a critical hit, the film required a $1.5 million investment from Walt Disney and a bank loan for it to be completed. This was a huge financial risk, one that definitely paid off and went on to make $8 million at the box office.
2. American Airlines
In 2011, American Airlines hit rock bottom so hard that its stock fell to 20 cents per share and was subsequently removed from the New York Stock Exchange. Even though the company’s $90 million net worth didn’t seem entirely bad at first glance, The Wall Street Journal compared it to “less than the typical list price of a new passenger jet.” If it wasn’t for investors buying up the cheap stock in large quantities, then American Airlines would have suffered a similar fate to other airlines like Pan American World Airways.
3. Six Flags
Six Flags is great at providing entertainment for the entire family but at one point, they weren’t so good at handling the financial side of things. In 2009, the company fell behind with $2.9 billion in debt. And just two months later, they had to pay $300 million to their stockholders. To top it off, they had to make up for all those payments in only two months. So they filed for bankruptcy. This entire ordeal was short-lived as they returned a few months later crediting their lawyers for putting an end to their rollercoaster of a journey.
In 1948, BMW shifted their focus from affordable automobiles to luxury cars that were priced at four times the average wage of a regular citizen, like the BMW 501 when it was released in 1951. As expected, very few cars were sold and the company came close to crashing. Thankfully, they were saved by the investments of Harald Quandt and Herbert Werner of the Quandt family, though they demanded a restructuring of the company with new managers. It was a risky decision, but one that we can clearly see the results of today.
When Apple ran into some unexpected financial issues in 1997, they were saved at the last moment by an unexpected investor. It was their biggest competitor, Microsoft, who invested a whopping $150 million to keep the company afloat. This was a great business decision: Apple continued to churn out more great products for several years, while Microsoft clearly made a huge profit from this investment. Imagine how different things would have been if Apple never took off.
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