Sometimes things don’t work out. Not every deal is a home run.
This is an email I received a while ago, but in the wake of the ongoing mess we’re in, it seemed apropos to bring it up.
I can picture the scene.
Vice President: “Here’s that schedule you asked for. You were right. That deal in Dallas was a pig. The IRR is negative 63%. The rest of the investments we made look fine.”
CEO: “I don’t want to show a negative value to our investors. Find a better way to show that we lost a bunch of money. You know… come up with something less obvious. I don’t want to hide anything. I just don’t want to show it.”
Vice President: “OK. I’ll get my best financial analyst to work on it.”
I didn’t have any great advice for the person who reached out to me. There’s no good way to show that you lost a bunch of money.
My advice was to be consistent in your reporting. If you got wiped out, show it. Sometimes you just have to be direct with people and take the hit.
As for how “something like that would be received”, my guess is, not well. No one likes losing money.