Years ago I lost my shirt on a large project. It involved a Canadian company1, a large US company and the US government. The contract was to be a 5 year contract with at least $250 000/year for me. There was another 4 other guys in it. We all drooled at the possibilities. Think about it, a quarter million dollars per year each. I was the West Coast, one was central Canada, another the US east coast,...

Because we were so diversified in place, style and work, we had to meet in Chicago, Toronto, and Ottawa... Then 11-Sep-2001 came, and the role the US government in the project changed2! First they put a delay on the project until they figured what they wanted. Then every month at every meeting, they changed their position, their technical requirements3...

Meanwhile my expenses kept on climbing: hotel, airfares, equipment upgrade and new equipment... 2003 and still no contract. One guy, obviously the smartest of all of us, dropped. 2004 and still no contract, but more meetings... $$$$$

At the end of 2004, the "Boss" aka SWMBO4 wanted me to pull the plug, this was draining our financial resources. I still wanted to try to stay in, the quarter million dollars per year is still too good of carrot. Finally in January 2005, I took a customer of mine, John, for lunch to discuss my situation and ask for his advice. It came to:

John: Can you see an end to the run around and a beginning date to the start of this work?
Me: No, not right now
John: Then stop throwing good money after bad. You'll never get that contract.

  1. I just phoned one the guy that stayed to ask him if the project ever went ahead and he said no.
  2. Was this a scam? No, it was not a scam, but a very bad business decision. I refused to see the early warning signs of when they, the US Government and the large US company, started to change their requirements.
  3. I can't give any detail of this project because of the contract/settlement. I got less than $10 000 US when I left the project under the condition that I don't ever discuss the details of it.
  4. I lost around $75 000 on this "stupid" project.
 

1 They were already a customer of mine for other "stuff" ↑

2 what an understatement ↑

3 From medium format to 4x5 films... ↑

4 She Who Must Be Obeyed ↑

Tags: Biz101 | Scams