SVP’s The Liquidation Survival Guide and Model: Vol 1, 2 & 3

Key takeaway

For entrepreneurs: Understanding the liquidation process and preparing for it can significantly increase the chances of business survival and recovery.
For investors: A well-structured liquidation preference can protect investments and ensure better returns even in adverse scenarios.

Summary

The "Liquidation Survival Guide and Model" series by Noah Gross provides a comprehensive framework for navigating the complexities of liquidation. It covers essential strategies for both entrepreneurs and investors to manage and mitigate the risks associated with business liquidation. The guides emphasize the importance of preparation, clear communication, and strategic planning to ensure the best possible outcomes during liquidation events.

There are 4 primary Liquidation Preference Scenarios with an associated Excel file completed for each. Each post walks through each scenario, the logic behind them, and the actual calculations that need to be done. Each scenario requires a lot of specific formulas, adjustments, and some manual calculations, especially when scenarios get mixed.

Vol 1: Non-Participating Liquidation Preference without Seniority
Vol 2: Non-Participating Liquidation Preference with Seniority
Vol 3: Participating Liquidation Preference without a Cap
Vol TBC: Participating Liquidation Preference with a Cap
Vol TBC: The all-in-one Liquidation Preference Template and Other Terms to Watch Out For

Insights

Preparation is crucial: Both entrepreneurs and investors need to be well-prepared for potential liquidation scenarios to minimize losses and maximize recovery.
Clear communication: Transparent and honest communication between stakeholders can prevent misunderstandings and foster a cooperative approach to liquidation.