Sollertia Blog

It’s not a pleasant process when you or your company become bankrupt, but it’s by no means the end of the road for you as a businessperson. You could become an employee for a number of years until your bankruptcy order is terminated and then start up another company.

Starting a new business

There is nothing stopping a bankrupt person starting up a new business after bankruptcy. You may be disqualified from being a company director for a number of years, but you can still start a business as a sole trader or partnership.

Financing the business

It may be difficult to obtain credit or loans if you are personally bankrupt or the director of a bankrupt company. This can make it difficult to obtain the necessary capital for a new business.

If you are in partnership with someone with a good credit record, you may find credit easier to obtain.

There are alternative ways of starting a business. If your business idea and plan are sound, you may be able to find investors interested in funding the business.

You could start a consultancy business or service-based one that requires little finance to get started. You may be able to work as a self-employed subcontractor for a large business and not need much operating capital.

The Bankruptcy Order will remain on your credit file for six years or more, after which you can slowly build up your credit rating.

Be careful with your finances

Many businesses go bankrupt due to poor financial decisions. If you start another business, avoid this by using a financing outsourcing service who can look after the recording and administration of the finances for you. Use an accounting service that can advise you on how to maintain a healthy cash flow.

Extending payment terms

One strategy for a healthy cash flow is to make extra sure you get paid on time. If possible, limit the number of credit customers, and remember that a good outsourced financial service can take over the collection of payments for you.

There is a life after bankruptcy

Although bankruptcy is not a good experience, your career or business life can recover. Many successful entrepreneurs have had business failures from which they have bounced back from. Among the people who have headed bankrupt companies are Walt Disney – who went on to become a multimillionaire with his own empire – and current US President Donald Trump.

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