On 12/18/2009 12:06 PM, Mauro Lacy wrote:
You maintain this business as long as you can, and when things are
starting to get murky(really murky) and "profits" are falling, you
suddenly fire all your employeess, close offices, and disappear in your
private jet, to have a well deserved recess in your private island.
You don't even need to disappear.
Startups fail all the time. The founders get to keep the salary money
they pulled out; they don't have to pay anything back (that's the whole
point in "incorporating"). If their ideas don't work, well, it's not
illegal to be wrong. The only way they'll get nailed is if they signed
personally for any loans (which the *honest* ones often do, when things
start to go sour, but you can bet a lot that Sean has kept his personal
signature far away from any documents guaranteeing any investor paybacks).
What's more, if they had a good long run, the ex-CEO can use that
obviously valuable experience if he cares to look for a management
position in a legit concern at some point in the future. The bigger the
failure (in dollar terms), the more impressive the experience looks on a
resume. In short, if and when Steorn goes splat, Sean McCarthy will be
left sitting pretty, unless he does something blatantly fraudulent
between now and then.
It's even conceivable that Steorn could ditch the free-energy product
and sink some money into something legitimate, and eventually come out
with a real product of some sort. Then they wouldn't even need to go
"splat", though they'd probably need to shrink a bit. (They could try
marketing Linux in Ireland, for instance. Marketing Linux seems to be
an idea that has occurred to a number of failing firms, albeit with
mixed success -- see, for instance, Silly Graphics.)
Multiple exit strategies are there for the taking.
Contrast this with Madoff's ill-fated venture.
Come to think of it, a perpetual motion machine is the ideal project for
these kind of business. And now that the world is turning "green", time is
ripe.
That's for sure!!
Best regards,
Mauro
