Update on GenCon Bankruptcy - Letter from Peter
From The GenCon Community Forums:
Friends:
Today Gen Con is filing for Chapter 11 Bankruptcy protection.
Essentially what happened is that we lost a lot of money this year running a licensed non-Gen Con event. We owe several companies money from this show and it’s going to take time to pay them off. To protect ourselves from the more aggressive companies we have been forced to seek protection from the courts.
While this is certainly an unfortunate development it will not impact our ability to operate Gen Con Indy, nor should it affect our licensed Gen Con events in the UK, Paris, and Australia.
The way a Chapter 11 works is that we negotiate a long-term payment plan with our creditors with the assistance of the US judicial system. The courts will closely oversee our business affairs to make sure we are running the company prudently and that we have a reasonable plan to pay everyone off. Which we do. The courts also protect us from aggressive creditors so that we can continue operating.
Gen Con LLC will get through this strong at the other end. Our fundamental revenue generating asset is our Indianapolis show, Gen Con Indy. This show is profitable enough to cover our direct costs, our overhead, and have some funds left over to pay off the debts from the licensed show. It will take some time, but this is one of those situations that the Chapter 11 filing was designed for, to help good companies get through a rough situation. Everyone will eventually get paid and business will return to normal. In the meantime, Gen Con Indy carries forward without interruption. Heck, if the airline companies can do it, why not us!
I’ve learned some hard lessons about the event business over the last few years. After trying to get Gen Con So Cal to work, and then losing money on this non-Gen Con event, I’ve learned how difficult it is to run a “big show” and make money. It’s a highly speculative affair where you’re never quite sure until the show’s over whether you made money or lost, mainly because you just don’t know how many people are going to come and for how long.
So, going forward our organization is going to focus on what we do best: managing Gen Con Indy, a healthy, vibrant show that has been growing nicely ever since moving to Indianapolis.
Here is a link to the press release we are issuing today describing this filing:
http://gencon.com/2008/corporate/news-pr/releases/2008/2008.02.15.Press.aspx
As you can probably guess, there’s not a lot I can say about this publicly, due to it being a sensitive legal matter and all. I’m traveling this coming week to New York Toy Fair, so my access with be spotty, but I’ll be sure and check in at least once a day to field questions best I can.
Peter D. Adkison
CEO, Gen Con LLC
GenCon Web Site Back Up
Here is the link to the press release.
Chapter 11 doesn’t mean they are going under for certain, like I said before. But it does make them rather vulnerable in some respects.
Someone on one of the links I sent you earlier made the point that Peter could reach into his back pocket and settle the Lucasfilm on his own. That may or may not be true, but the reason that you form an LLC in the first place is so that you don’t have to do that.
I guess we have, at this point, to have some faith in the man that gave us Magic as well as 3E D&D, and our courts.
I’m gonna be pissed if it winds up affecting this summer’s con, though.
GenCon Goes Bankrupt
NOT good news.
I discovered this, literally, 2 minutes after I finished my new Squidoo Lens on GenCon.
Friday, Peter announced that GenCon LLC is filing chapter 11 bankruptcy.
It’s chapter 11, which means restructuring, as opposed to going out of business. Still, it doesn’t bode well when it happens the same week that Lucasfilm sues GenCon for around a million bucks.
Another link.
And Another.
Gencon.com seems to be down today.
More updates (in the comments section) as they become available.
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