The Great Kirk Kerkorian Has Died
I just received word that the great Kirk Kerkorian died Monday at the age of 98. Kerkorian was one of the great tycoons and an inspiration for the creation of The Tycoon Playbook. He will be missed.
Bebo’s $849M Implosion Teaches a Brutal Lesson in Business
This news story gave me a chuckle as I have a long-held fascination with revolving door deals. There are two basic kinds. The unintentional and the intentional. The Bebo one is an example of the unintentional variety with a spectacular payoff.
Also-ran social network Bebo has been bought back by one of its founders for $1 million five years after that same founder, along with his wife, sold Bebo to AOL for $850 million. Sure, the couple made out like bandits, but there’s a bigger lesson here: Buying a copycat social network is a terrible idea. (source)
Some are seemingly intentional.
In a nutshell, a revolving door deal is one in which a company is sold and then taken back when the buyer is unable to make his payments. The seller gets to keep the down payment and all the other payments received to date in addition to regaining full control of the business. I believe the term was first coined to describe Kirk Kerkorian's various deals involving Las Vegas casinos and movie studios. When a buyer came along who needed seller financing help, Kirk would accommodate them but under some pretty onerous conditions. These were created by having a set of covenants that would create a death spiral in the event that the buyer failed to comply with even a single one.
Kirk Kerkorian the Smiling Cobra
The world needs a new biography about this consummate deal-maker. Kirk is 95 years old as a I write this and gradually slowing down. The man is a rare example of a bona fide rags-to-riches story. His one and only biography was published in 1974. That's 39 years ago.