Main Ingredient in Any Startup? Simple. Money

February 24, 2020

If you follow me on Facebook, you know I spend a lot of time at the Algonquin Hotel in New York writing. Sometimes I write blog posts, while other times I work on my book, Baker Street. Today I am going to blend the two.

Here’s a few pages of Baker Street (unedited) which are about, well, money:

I think I handled the meeting well. Rich had given me some ballpark numbers on what he thought our technology was worth, so I simply stuck to the script. The week earlier Rich called me into his office and said, “Jake Baker, Bake, you’re now the president of RipTek.” I was 31.

I don’t remember the name of the fellow I met with, but he was quite accommodating. Pimco was interested. They wanted our technology. We even agreed on the price. I’d read somewhere that Pimco had like 29,000 employees so they could afford to part with some cash. When I got back to the hotel, I told Heather of my triumph, though neither of us had any idea what I’d just done. Still, time to celebrate.

Heather had been nursing a cold since about arriving in Venice, so she was not feeling her best. She urged me to head out and have some beers while she rested up for the trek home. Then the phone rang. It was the guy I’d just cut the deal with. Pimco was rethinking the deal. “Talk to Macy when you get back in the states,” the man said. Hmmm. Maybe selling technology is harder than I thought. No big deal. RipTek is cool and in great shape.

Only we weren’t. At least not the great shape part. When we returned, Rich asked me straight away about the technology sale. I told him we needed to talk with Macy over at Pimco USA. “Oh man, Bake, we’re in trouble,” Rich said. Trouble? Seems we, as in Riptek, had no cash. No cash for payroll. No cash for paying expense checks. Back then Heather and I had very little personal savings and to think I couldn’t make our house, car or credit card payments scared the shit out of me.

Rich was pretty sure Macy would eventually come through but there was the matter of payroll on Friday and my expense report. I tried to explain to Rich that he’d lose everyone, including me, if we couldn’t make payroll.

Then Rich had an idea. He called his brother. His brother who owned a bar. Good news! Rich’s brother was coming in with $100,000! That would cover payroll, my expenses and leave a little bit to spare. That meant I could pay off our personal credit card, make our house payment and get by for another month. Whoa. This being a president is hard stuff.

Payroll was automatically produced by our accounting service, but expense checks and bills were paid by the bookkeeper who Rich was quite fond of. Over the lunch hour, while the bookkeeper was having lunch with Rich, I grabbed the paper checks from her desk and made one out to me to cover my expenses and slid the rest back in her drawer.

Later that same afternoon a guy walks into RipTek carrying a duffle-bag. I figured it was Rich’s brother, but it turned out to be his brothers associate. Rich had already left for the day, so I talked to the guy. The guy turned out to be the actual source for the money. As he sat down with me, he opened the bag and showed me the cash. Now I was getting nervous and my life was starting to feel like a movie, a bad movie, the kind where people die.

I didn’t want to take the money, but I had no choice. Not only was RipTek out of money, so was the Baker family and I had RipTek expenses on my credit card to boot. So, I took the duffle bag and headed to the bank. On my way to the bank I called RipTek’s attorney, a young, attractive woman named Constance. She said she knew RipTek was squeezed for cash but didn’t know it was this bad.

When I got to the bank with the duffle bag and deposit slip, I headed to the first open teller and told her I needed to make a deposit. As I started take out the wrapped bills she said, “Sir, how much are you depositing.” One hundred thousand dollars I told her. “Not at my window. Cash deposits that large need to be recorded for IRS purposes.”

Not knowing what to do, I started to panic. I knew I looked guilty of something even though I wasn’t guilty of anything, yet there I was with a bag full of cash. After a few minutes the manager came out and took me back to his office. He didn’t think there was a problem, they just needed my photo ID and some other information, and I’d be on my way. The duffle bag was starting to feel very heavy and I distinctly remember noticing all the cameras in the bank and for some reason I couldn’t quit looking right at them. Ugh. I looked so guilty!

When we got to his office, the bank manager took the duffle bag and started counting out the money. I remember thinking that I really had no idea where that money came from, only that an hour or so earlier a guy, who was now starting to feel very shady, had brought it to me. Now feeling guilty myself, I decided to come clean. I told the manager the entire story of how I came to have this bag of money and how important it was for RipTek to make payroll the next morning. He seemed sympathetic to my situation.

Once the cash was counted out, all $100,000, the bank manager left the room to get me a receipt. My eyes never left the money. I knew, in that stack was the last money I was ever going to get from RipTek and that my first run as a tech president was coming to an end.

After the manager came back with the receipt, I headed back to the same teller I’d met with earlier and handed her the RipTek check made out to me to cover my expenses. It was also signed by me which made it look that much more suspicious. She indicated that she’d need the manager to approve it. Ugh. Here we go again.

The manager, now my buddy, came over and signed the front of the check noting his approval. The teller paid me in cash, and I headed to our bank.

When I got home from the bank, I immediately wrote checks to pay all our personal bills, but started to panic when I realized this was the end of the line. I was thankful for Rich taking a chance on me but scared for my family. The Baker kids deserved better. Heather deserved better.

The year before when life was going so well, Heather and the girls bought me a 1969 Chevelle, nearly identical to one my family had when I was a kid. It only had 31,000 miles on it, and it was in pristine condition. The farmer we bought it from gave us an amazing deal. The girls loved the car and almost nightly we’d tool around town making the dual exhaust roar to life.

Now as I sat there looking at our checking balance, I knew I had no choice but to part with the Chevelle, so I ran a classified ad. The next morning, I got several calls on the car and the first guy paid me in cash, a lot of cash. We did well on the sale and while it broke my heart, I knew we had to do it.

This time I went to our bank, with my own cash, and made the deposit. I think it was $6,000, mostly $100 bills, save a few $50s because apparently, he planned to dicker with me. When he saw the car, which was for the most part 25 years old and new at the same time, he paid full price. It turned out $6,000 wasn’t enough to make me go through the same things I’d gone through the day before.

Over the weekend, back down to two cars, I was depressed. Selling the RipTek technology felt like a Hail Mary of epic proportions and likely just a temporary fix. I wasn’t sure what I was going to do. RipTek was such a cool company, but Rich, the sweetest man in the world, just couldn’t catch a break. I needed to take destiny into my own hands. Hmmm, maybe I’ll do something on this Internet I’ve been reading about.