Opportunity

A pharmaceutical firm was not doing well after its first year of operating after the acquisition.  We were brought in by the investors as the CFO. 

Action

We found the loss was much higher than anticipated, 110% of sales.  People expected it to be out of business in weeks.  Instead, we kept the business flowing, buying time with vendors while collecting receivables.  We listened to employees and got people together on the same page.  We put together a short term plan and convinced the investors and banks that there was a good business here.  They agreed, with the investors putting in another round of equity, the bank agreeing to restructure their debt and new top management hired in certain areas. 

Result

Just four years later, the company earned 56% net income on sales and sales had grown over 650% from that first year.  The bank and investors said we played a major role in keeping the company together, buying time and persuading them to push ahead.  Without our efforts, they said they would have likely sold off the company at a major write-off.