It was now a race against time. As long as the Marvel auction winner remained skittish and didn’t sign off on the deal, there was still a chance we could convince the legal trustee holding the assets to sell them to us instead. But if the auction winner figured out the Valiant Intellectual Properties riddle and still felt comfortable enough to move forward, the assets were his because he won the auction.
I called the trustee. He played coy.
“We heard the deal hasn’t closed and that there’s a big problem,” I said.
“No, there’s not a big problem,” he bluffed.
“Yes, there is – I know there’s a big problem,” I replied. “And you and I both know that the auction winner may never close this deal, because of all the mess with the trademarks.”
“Okay,” he said. “Go on.”
“Well, the assets are technically unsold and still available for purchase. We may be willing to go ahead anyhow and let you sell them to us,” I said, “but you would have to give us a big discount.”
A price negotiation commenced. The numbers were much bigger than the battle I’d had with the chessboard street vendor as an eight-year-old on the streets of Agra. But, in the end, I got him to shave $200,000 off the original auction price before we settled on $725,000.
Looking back, I realise I could have probably gotten a better price. But I didn’t want to risk pushing too far and lose the deal. This was a unique asset; there was no similar opportunity or deal like it. Also, as the saying goes: pigs get fed, hogs get slaughtered. Become greedy and you can kill a negotiation. It’s always better to leave a little something on the table for the other person and make it a win-win deal. It’s good for long-term business and often the right thing to do. “If you sign the papers and wire the $725,000, the assets are yours,” he said.
Suddenly this was all real and immediate. Misty, romantic dreams had been whisked away; the cold, hard realities of business were now staring me in the face. I would either secure more money than I had ever imagined or I would lose my shot at owning a piece of Valiant.
Entrepreneurs often say that your first funding is your hardest. That’s true in more ways than one. At least it was for me. There is, of course, the obvious – you have no track record. That means you’re typically left to turn to friends and family to raise capital. And it is that second part – asking the people you love and care about most to entrust you with the money they’ve spent years struggling to earn – that is the toughest on your heart.
The gravity of the moment and the risks involved weigh on you, washing over you in a wave of humility and concern. But if you’re motivated, and you truly believe in your dream, you can channel and harness that feeling of responsibility and appreciation to develop a mindset that says: I refuse to fail. Not just in business, but fail the people who believed in me enough to back my goal with their hard- earned resources.
I’ll never forget the conversations I had with my family members when they decided to put up huge portions of their life savings.
My father had heard me float enterprising ideas before. Some of them were even good. But he had never seen this level of conviction and tenacity from his son. Valiant held the potential to change all our lives and he knew it. I spent hours answering all of his important questions. Then he spoke words I still remember. “I trust you, my son. I’m going to help you do this. I will put in money and raise as much as our family can. But Jason, you really have to make this work.”
For a man who was often short on compliments, it was the biggest one he could have paid me. His trust shone through in actions, not words. Later, the financial burden this level of trust placed on our family during Valiant’s lean early years would strain my relationship with my family for many years. But when it mattered most, they stood firmly by my side. I’m forever grateful.
Dinesh came through with his portion of the funds as well. Wiring that much money on the day of the transaction felt surreal. Then doubts swarmed my brain like a squadron of killer bees.
If this fails, how will we ever face our family and friends who broke their banks for us?
What will we do if we’re saddled with all that debt?
Even if we do own Valiant assets ... then what?
I decided to visit my Wharton professor Lawrence Gelburd in the hope his words of congratulation might buck me up and calm me down. Bad move.
“Wait,” he said, “I know you said you raised the funds to acquire the assets. But how much did you and your partner raise in operating capital to run this thing?”
My stomach cinched in a knot.
“Well…um…” I muttered.
“Oh my god, Jason. Please tell me you have a war chest to actually run the business, like rent the office space, hire the staff, do the legal work, buy equipment, pay artists…I mean you’re joking, right?’
I felt like I wanted to throw up.
“We raised about $30,000 more dollars than we had to wire. So that’s our operating money, I guess.”
“$30,000?! Are you kidding?! How the hell are you going to run a business with that? That’s not enough money to do anything! It’s certainly not enough to run an entertainment company.”
I wanted to melt into the floor and trickle out under the door.
“Well,” I said softly looking at the floor. “We’ll figure it out. Have to raise more money, I guess.”
Beyond pointing out the gaping money hole staring us in the face, the conversation with my professor had delivered another cold slap in the face. If I’d thought that the hard part was scurrying around in warehouses, learning bankruptcy laws, hustling for legal help, bidding at auction, negotiating with the legal trustee, raising a mountain of money as a college kid, and securing the Valiant comic book assets, I was sorely mistaken.
As I was about to learn, that had all been the easy part. The real work had not even begun.
From 2007 to 2013, Valiant Entertainment was my life.
After hours of conversation, I convinced Walter that our dream of resuscitating Valiant back to life could become a reality. Even though we had zero money and couldn’t pay him a single cent, I said if he helped us start and fought by our side, one day, when we succeeded, I would make it up to him.
To my amazement, Walter agreed. In fact, he did even more. For two solid years, he worked with me in New York City and helped me battle through my bleakest moments – times when it looked like I might have made the biggest mistake of my life.
Since we had no money for an office, Walter took the train into the city and met me at Penn Station (New York City’s main subway hub). There, we worked on the tables and benches. No joke.
We literally worked out of the train station for a year. When that got tiresome, Walter and I started hopping from restaurant to restaurant. We’d hole up in a corner table and order a Coke or the cheapest item on the menu.
After a few hours, the restaurant staff would get annoyed that I was too cheap (cash-strapped) to order a full meal while tying up table space. So we’d move on to another restaurant and do it all over again. After another year of bouncing from eatery to eatery, we finally decided to make my apartment “living room” (my couch and a chair) our primary base of operation.
Initially, perhaps because of my business school education, I was fixated on developing the perfect “business model”. Like a good Wharton grad, I analysed the industry in detail. In school I studied hard to get good grades. Now I was studying because my business and life depended on it. I was desperate to figure out the best way to make the Valiant assets successful. Was it film? Television? Console gaming? Mobile gaming? Consumer products? Traditional comic book publishing? If the latter, should we publish new or classic content? I wasn’t sure.
Excerpted with permission from Irrationally Passionate: My Turnaround From Rebel To Entrepreneur, Jason Kothari, HarperCollins India.