If you’re on the verge of declaring personal bankruptcy, a champagne toast might not be an inappropriate reaction. No, of course you don’t feel like clinking glasses – but take a minute and look around at the familiar faces in the bankruptcy club. Recognize anyone? Congratulations – cheers to your bright future! Bankruptcy can be a bubbly prospect when you consider all the incredibly famous and successful people who declared bankruptcy and still enjoyed monumental success in life.
More successful, high-profile entrepreneurs, celebrities, and high-profile individuals have rebounded from bankruptcy than you can believe – a litany of historical heroes to current-day celebs. They did not fail – far from it. In fact, bankruptcy for many of them was one footstep towards success.
Everyday people considering bankruptcy as an option to help them achieve financial freedom can take heart at the outcome of eight high profile bankruptcies. Even though declaring bankruptcy can be a difficult journey, it doesn’t mean you’ve failed. The road to recovery can be long, but you can still get there, in time. Take it from eight guys who wouldn’t let a perceived failure stop them.
Bankruptcy and genius
The bearded bankrupt. Pre-presidency, Abraham Lincoln started a general store in New Salem, Illinois with a partner, William F. Berry. Unfortunately, modern bankruptcy laws were not in place to protect his assets, and so when the store failed to compete successfully with another local shop, Lincoln’s possessions were seized. His partner died, leaving no assets and Lincoln to pay off his debt. Lincoln paid off both debts in time and, as we all know, went on to achieve considerable respect and renown as our 16th president, providing exemplary leadership through the Civil War years.
The ringmaster in the red. Showman P.T. Barnum was born to take risks, including financial ones. In 1856 he experienced financial failure after making loans to the Jerome Clock Company, which went bankrupt. Their plummet and his investment in their company necessitated his selling of an entire American Museum he had opened. It took Barnum years to recover, and he endured mockery and humiliation from many public figures, including prolific writer Ralph Waldo Emerson. But recover he did – LIFE magazine chose him as one of the most influential figures of the millennium.
The foundering founder. H.J. Heinz experienced an extremely public, embarrassing bankruptcy in 1875 that affected his entire family, including the success of the family business. His business Heinz, Noble & Company, which sold horseradish, went bankrupt soon after its forming. Heinz approached his bankruptcy with grim determination to pay back all his creditors – and pay them back he did. Known for always treating his workers with respect and dignity, Heinz served as the president of Heinz company until his death.
The candy collapse. Milton Hershey’s Philadelphia candy shop floundered after six years of trying, trying, trying as a young man to succeed. Following the shop’s bankruptcy, he traveled to Denver and started scoping out the caramel market there. Hershey’s determination paid off – he eventually succeeded with using fresh milk in caramels, founding the Lancaster Caramel Company in 1887. From there he developed a distinct interest in chocolate-making, a legacy he left through the worldwide Hershey Company he developed that sells products in over 70 countries with plants all over the world. Not surprisingly, the Hershey Company holds the market share in the U.S. for the chocolate industry. Their iconic brands include everything from Almond Joy to York Peppermint Pattie – and it all began with one man and a bankruptcy.
The Disney debtor. Yes, the beloved Walt Disney went bankrupt in his early days. After founding his own animation company called “Laugh-O-Grams” in the early 1920’s and hiring his first employee, Fred Harman, the company sagged with debt, and Disney was forced to declare bankruptcy. But it wasn’t long before he started another creative venture, called the Disney Brothers Studio. Disney eventually won 22 Academy Awards for his celebrated work, quickly becoming a household name, and opened the iconic Disney Land in 1955. Unfortunately, he died from lung cancer before seeing Disney World open in 1971.
The cash-strapped crooner. Jerry Lee Lewis, a.k.a. “The Killer,” just can’t quit – even though he’s declared bankruptcy once, he’s still on stage, singing, performing, and going strong. The American singer and songwriter filed for Chapter 7 bankruptcy in the late 80’s after some issues with the Internal Revenue Service and racking up several million dollars of debt. Today he continues to tour and his 2010 album reached number 30 on the billboard charts.
The destitute Donald. Not one, but four bankruptcies fill Donald Trump’s record, beginning with his Atlantic City casino – the Taj Mahal – in 1991, and ending with the bankruptcy of Trump Entertainment Resorts in 2008. In between he cut personal spending, lost salaries, reduced shares, and sold his private yacht and airplane in efforts to repay debts. Yet America still knows and reveres him as a successful businessman, author, and television personality – with an office in Trump Tower and the success of “The Apprentice” behind him, he has far from failed.
The diamond defeat. Rapper MC Hammer had it bad, but he pulled it together. His diamond-selling album “Please Hammer, Don’t Hurt ‘Em,” brought in $33 million according to Forbes, and in six years he was declaring bankruptcy. Since then, he has paid back his debts and even started his own search engine to compete with the big guys, like Google. Who knows – maybe he’ll pull it off!
Obviously bankruptcy is not an equation for success – a good deal of chutzpah and grit round out the formula for survival – plus, having the discipline to pay back creditors, reform financial habits, and patiently let time do its magic . No one recovers from bankruptcy overnight, and no one particularly enjoys declaring it. As a rule of thumb, declaring bankruptcy of any chapter is advised as a last resort unless a person’s exhausted all other options.
But because of its drastic nature, bankruptcy can put your life on a drastically new course. For these eight men (and we didn’t exclude women on purpose! Women succeed from bankruptcy, too), bankruptcy was not enough of an obstacle to stop their forward motion for long enough to lose momentum. Instead, these individuals received the blow they’d been dealt and recovered from it, letting bankruptcy buoy them upwards back towards success.
Inspiring? You bet.
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Brooke McDonald is an avid writer and online contributor for Twin Cities bankruptcy lawyer Chad A. Kelsch at Fuller, Seaver, Swanson & Kelsch, P.A. She enjoys writing about finance and personal bankruptcy issues, especially when they deal with celebrities.