Liquidation is the painful but orderly process of winding up a company: sell its remaining assets, pay creditors as far as possible, and formally dissolve the business. There is no shame in failure, but leaving the company cleanly protects relationships and makes the next venture possible. section 30.0 section 30.2
A practical liquidation usually means:
- Have the board approve a formal resolution stating that the windup must happen, how it will be funded, and who will perform the work. section 30.3.1
- Prepare documents describing assets and liabilities, then sell whatever assets have value. section 30.2 section 30.4
- Let experienced windup professionals negotiate with creditors, who may accept a partial payment instead of pursuing a lawsuit. section 30.2 section 30.4
- File dissolution papers with the secretary of state after the process is complete; the company then legally ceases to exist. section 30.3.7
FactPoint turns a liquidation into a restart
After FactPoint shut down, only the founder and CFO remained. A firm experienced in bankruptcies and liquidations reviewed the assets, including furniture, computers, and patents, while the team settled employee matters and contacted customers. Patents initially thought to be worth $1 million became available for $65,000 through the asset sale, providing the foundation for a new startup. The hard lesson: finish the windup carefully, but keep your eyes open for what can come next. section 30.3.7 section 30.4
