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News OnLive closes, re-opens to avoid debts

Discussion in 'Article Discussion' started by Gareth Halfacree, 20 Aug 2012.

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  1. DaBigDog

    DaBigDog What's a Dremel?

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    Really BLC?- just because you can do it - it's OK too? When did running a business exclude people from any moral obligations, they have effectively screwed investors of $40m by doing this.

    It should be less OnLive-2 and more InJail-NOW

    They've had to do this because either they're not good enough at running the business as is or the market isn't interested in it - either way it should have been left to die.

    If you can't make a business work when your given $40m to fund it, you really shouldn't be in business.
     
    DaBigDog, 20 Aug 2012
    #21
  2. Blazza181

    Blazza181 SVM PLACENTA CASEI

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    It's less of a loophole, more an intentionally created system, to protect entrepreneurship.

    http://en.wikipedia.org/wiki/Phoenix_company
     
    Blazza181, 20 Aug 2012
    #22
  3. tonyd223

    tonyd223 king of nothing

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    Packaged Insolvency? I hope the government closes this loophole because of public pressure. I will NEVER work with or for a company who has done this...
     
    tonyd223, 20 Aug 2012
    #23
  4. Gareth Halfacree

    Gareth Halfacree WIIGII! Lover of bit-tech Administrator Super Moderator Moderator

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    Trouble is, you can't. Not without serious damage to the market, anyway.

    Let me put it another way: would you risk everything you own, including re-mortgaging your family home and taking out massive personal loans, to start a business which could make you a bajillionaire but which could also lose you everything - with the odds stacked against the former in favour of the latter?

    If you said yes, and the business failed, once you'd clawed your way back up from the massive pit of debt and homelessness that ensued, would you do it again?

    An entrepreneur - let me rephrase that, a successful entrepreneur - is someone who answered "hell yes" to both questions. Look at good ol' Sir Clive: business after business went bankrupt, but he kept on going. Sinclair Radionics became Science of Cambridge became Sinclair Research (okay, that was a rename rather than a bankruptcy, but still) became Sinclair Computers and Sinclair Vehicles became Cambridge Computers (after he sold the ashes of Sinclair Computers to Amstrad) became Sinclair Research again. Incidentally, Sinclair Research is still ostensibly going, albeit with just Sir Clive at the helm - he's been making overtures in the electric vehicle market again with the X-1.

    When he allegedly tricked the taxpayer into funding the failing Sinclair Radionics and pushed the money he got from the administration (£10,000 from the National Enterprise Board as a golden handshake when the company was broken up) into what would become Sinclair Research, any sane person would have been up in arms - here's a man who was given taxpayer's money, failed to return a profit and is now taking that cash and setting up a separate business from which the government won't see a single penny beyond VAT and corporation tax payments. It's not a million miles away from what OnLive is doing now, in fact - except in OnLive's case, its investors were all private companies rather than government initiatives.

    So why did we let Sir Clive go ahead and phoenix his companies? Simple: because if we didn't let Sir Clive and his contemporaries invent the future, no bugger else was going to. Nobody else was crazy enough to risk everything - at the height of his financial troubles, Sir Clive lost his family home and his marriage broke down - on a gamble at creating something new and exciting. Sure, not everything he did was a resounding success - if he hadn't plowed all his money into the C5, Sinclair Computers would probably still be around today making ultra-affordable IBM-compatibles - but this is the man who was the driving force for getting computers to the point where they were affordable for use in the home. Without the sub-£100 ZX80 and ZX81, and the £125 Spectrum, Commodore, Atari, hell even IBM would have kept their prices at around the £500-£2,000 mark and computers in the home would never have happened.

    Now, I've gone a bit off-topic here, and I'm in no way saying that anything OnLive has done is as important or revolutionary as Sir Clive and his ilk - but I am pointing out that if you create a rule that prevents scammers from reforming, you'll also prevent true entrepreneurs from recovering from their failures - and in doing so potentially rob the world of some truly groundbreaking innovations.
     
    Last edited: 20 Aug 2012
    Gareth Halfacree, 20 Aug 2012
    #24
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  5. Krikkit

    Krikkit All glory to the hypnotoad! Super Moderator

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    Excellent points Gareth, and precisely why the system won't be changed. Just nice to let out a bit of rage from time to time. :)
     
    Krikkit, 20 Aug 2012
    #25
  6. Byron C

    Byron C Multimodder

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    I think Mr Halfacree just put it far better than I could ever hope to achieve.
     
    Byron C, 20 Aug 2012
    #26
  7. fdbh96

    fdbh96 What's a Dremel?

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    First of all, its nice to see that Bit-tech actually got the full story before posting the article, and secondly, where does the debt go? What do they lose by forming a new company?
     
    fdbh96, 20 Aug 2012
    #27
  8. faugusztin

    faugusztin I *am* the guy with two left hands

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    The debt stays at original company, which now has no assets. At all. So all the creditors are left with unpaid debts, which never will be paid. Company will go in liquidation, where the liquidator will find out that company has no money, no assets. Some minor money will have to come from the guys who own the company, but that sum is usually limited - Ltd type of company for example needs to have only 5k€ money for company liquidation in my country. If company has no assets, 5k€ is all the debtors can get all together.

    What did they lose ? Debts :). And some partners who will never do business with the again. And probably no one will trust them now.
     
    faugusztin, 20 Aug 2012
    #28
  9. fdbh96

    fdbh96 What's a Dremel?

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    Seems a bit harsh for the people that lent them money :/
     
    fdbh96, 20 Aug 2012
    #29
  10. Showerhead

    Showerhead What's a Dremel?

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    That's the risk you take investing in a startup.

    Wonder if we can form a new company transfer all the U.K.'s assets to it and leave the debt with the old U.K.
     
    Showerhead, 20 Aug 2012
    #30
  11. faugusztin

    faugusztin I *am* the guy with two left hands

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    It is called default and last 2 years we are trying to avoid it in Greece (sort of, as they partially did it already) :
    http://en.wikipedia.org/wiki/Sovereign_default
     
    faugusztin, 20 Aug 2012
    #31
  12. Somer_Himpson

    Somer_Himpson What's a Dremel?

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    Cloud computing= your computer, somewhere else, where you havve no control...bollocks.
    On-Live...just die.
     
    Somer_Himpson, 20 Aug 2012
    #32
  13. ccxo

    ccxo On top of a hill

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    So how long till On-Live 2 becomes On-Live 3 as i cannot see any investment group providing them with any funding after the first lot of investors lost their investment.
     
    ccxo, 21 Aug 2012
    #33
  14. iwod

    iwod What's a Dremel?

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    Well, in that case i guess not a single Gaming Company will work with them in the foreseeable future.
     
    iwod, 21 Aug 2012
    #34
  15. Gareth Halfacree

    Gareth Halfacree WIIGII! Lover of bit-tech Administrator Super Moderator Moderator

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    Actually, they've already received their first investment - from a Lauder Partners affiliate, which is the same investment group as plowed money into OnLive-1.
     
    Gareth Halfacree, 21 Aug 2012
    #35
  16. Blazza181

    Blazza181 SVM PLACENTA CASEI

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    The.... WHAT? I'd rather invest in Anne Widdecome Pornographic Enterprises than OnLive-2!

    Sent from my Orange San Francisco using Tapatalk
     
    Blazza181, 21 Aug 2012
    #36
  17. azrael-

    azrael- I'm special...

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    I'm certain the managers of said investment group have made sure to only invest their clients' money in this scheme OnLive-2.
     
    azrael-, 21 Aug 2012
    #37
  18. cebla

    cebla What's a Dremel?

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    I think something everyone is forgetting here is that OnLive-1 was going to go out of business and the investors were going to lose everything anyway as by the sounds of it they couldn't pay the bills. All they have really done is found a nice way to start a fresh company doing similar things but without the debt burden.
     
    cebla, 22 Aug 2012
    #38
  19. azrael-

    azrael- I'm special...

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    Well, that is _exactly_ what we're not forgetting. A company not being able to cope ditches all debts and starts over doing the exact same thing.
     
    azrael-, 22 Aug 2012
    #39
  20. Harlequin

    Harlequin Modder

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    ofc the investmant company will happily use the example of online-1 as a tax break , whilst it seems the investors are raged becaise of lost money , reality is the clients of said company are laughing as they can use the amount (likely along time ago) as a tax break - thus they have `earnt` many more times the now lost investment allready in savings
     
    Harlequin, 22 Aug 2012
    #40
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