The Aftermath

Into the Woods

It doesn’t feel great when the thing that you have been building for nearly half a decade to blows up in your face. That’s what just happened to me and my company, Mantle.

Here’s a quick rundown of what happened and what comes next.

I am far from the only person that had their dream job vanish due to the proliferation of COVID-19 — of this writing 23.9% (or over 40 Million) of Americans are unemployed. So, this is not “woe is me”.

This is a whoa, where are we?

I’ll be honest, our shared office concept was on the way out. We had developed a hip brand in one of America’s middle markets — Jackson, Mississippi. While it turns out that our market was not (yet?) suitable to the shared office concept for reasons that may get vetted in another post, we had worked hard to get our company on passable, if not solid ground.

We were in the middle of a pivot to a digital company with several new apps that were beginning to be downloaded in our local community. We would ride out our shared-space business and the lease, and then be off running with our fully-digital project: www.mantlecityclub.com.

That’s when Coronavirus hit.

First we turned off our base level memberships to keep the sheer numbers of people breathing potential germs in a shared space. Then, with most our high dollar members bailing because their own businesses were being decimated, or because they were realizing that working from home is not half-bad, we were done. Our revenue-generating business was sunk.

It was a wild-ride shutting down a business. The failure bubbles up. The creditors come calling. There’s a lease to pay. The world is upside down. It’s even wilder when you mix in a pandemic, and in my case a new baby that wasn’t sleeping.

I am still dealing with residual (metaphorical and physical) headaches from running into that wall, but I am starting to pull together the pieces. Our coworking company is dead, but the hope of a brighter future survives. We just had to take the next steps out of the woods.

Step One: Finding our Footing

The free fall can only last until you hit the ground. Unfortunately, usually, the ground really hurts. To ensure future viability, you will have to deploy the only tool that can soften the blow: beg and negotiate.

We decided to shut down our coworking space. We were planning on closing that part of the business anyway, so spending our money (or as noted later, taxpayer money) in trying to save a foregone conclusion seemed like throwing good money after bad.

However, to shutdown we had to negotiate with our landlord the remainder of our lease. We had to negotiate a new payment plan with our bank. We are close, but we have nearly moved Mantle. back to ground zero.

You can plan for nearly everything when starting your company, but like a failing marriage, it never seems to go down how you thought. No experience as an attorney or businessperson will catch everything. The Black Swan of Coronavirus will surely change the way companies plan for the unexpected end of their lives, unfortunately, this time around has put many in a free fall.

Step Two: Getting Help

There have been a whole number of options for assistance for small businesses from both the public sector and the private sector. No business should be too proud to take assistance. However, all businesses should know what they are signing up for when they do.

We did not take any federal assistance under the Paycheck Protection Program (PPP) and its forgivable debt option for two reasons. First, we did not have the paychecks to protect. We were not far enough along in our growth to have a bunch of employees and the PPP did not seem to perfectly fit our company. Secondly, even if it had applied to us, I simply couldn’t stomach setting the company (and possibly me) up with theoretically-forgivable debt. See ‘Free Fall’ in Step One. I was over dealing with large obligations for me personally. I was skeptical on the probability of forgiveness in the future if things did not turn around.

Then, Mississippi passed the Back to Business Mississippi Act (BBM). We are planning on applying for this new program to recoup expenses we incurred as a result of the virus. The BBM is NOT DEBT and is not required to be repaid. This is the kind of program that can really help Mississippi companies like us feel good about trying to restart and replant at home.

Here are the requirements for a BBM Grant:

1. Must be a for-profit corporation, limited liability company, a partnership or a sole proprietorship;
2. Was domestic as of March 1, 2020;
3. Is in good standing with the Mississippi Secretary of State, if applicable;
4. Suffered an interruption of business;
5. Has a controlling interest owned by one or more Mississippi residents, whether individual resident citizens or Mississippi domestic business entities;
6. Filed Mississippi taxes for tax year 2018 or 2019, or, for an eligible business formed on or after January 1, 2020, intends to file Mississippi taxes for tax year 2020, unless exempt under Section 27–7–29, Section 27–13–63 or other applicable provision of law;
7. Has customers or employees coming to its physical premises, conducts business on customer premises, or has an owner who is an active participant in the day-to-day operations of the business;
8. Had no more than 50 full-time equivalent (FTE) employees as of March 1, 2020;
9. Is not a subsidiary of a business with more than 50 FTEs; is not part of a larger business enterprise with more than 50 FTEs and is not owned by a business with more than 50 FTEs;
10. Does not exist for the purpose of advancing partisan political activities, does not directly lobby federal or state officials as provided in Sections 5–8–1 through 5–8–23, and has not employed or otherwise worked with a lobbyist as defined in Section 5–8–3 in any way at any point during 2020
11. Does not derive income from passive investments without active participation in business operations.

This program is administered by the Mississippi Development Authority and has yet to start accepting applications. You can enter your email on the Grant Website if you wish to get notifications about kickoff of the applications. If you have questions about the program, you can visit the Frequently Asked Questions page on the BBM website.

Step Three: Resetting

We were already in the middle of a reset when Coronavirus hit. So, in some ways, we are not starting from zero. We had an idea about where our Mississippi business was going. Some businesses may not know where to go from here. As part of our reset, Mantle. will go on without me at the helm. We are working to move the company forward post-coronavirus in some form or fashion to advance all of our Mississippi-stakeholder’s interests. The future is as uncertain as ever, we are not yet out of the woods — but we know that failure brings knowledge and experience.

We are excited to move forward with a new perspective in a new world. If you are an entrepreneur or a small business that needs help finding a footing, getting help, or resetting your business, you can contact me at my new gig with Lomax Advisory and Lyceum Labs, a new wing of The Lomax Law Firm and of Pearlbend Ventures. I am excited about sharing my successes and failures with Mississippi’s and America’s next big things.

The world has never been more uncertain. However, as Dr. King said, “Faith is taking the first step even when you don’t see the whole staircase.” Let us help give you faith in visualizing your future staircase. We are putting together unique payment structures for startups and small businesses that recognize where you are in your journey. We are building a startup advisory firm that wants to work with responsible businesses.

We have been where you are going. Let us climb with you into the future letting our path inform your next steps.

If you want to connect over Coronavirus questions or startups, you can connect with me via the comments below or at christopher at pearlbend dot com.