Why Did HMNY (MoviePass) File That Alarming 8K?

We all now know that HMNY filed an 8K that set off alarm bells, causing a media panic claiming MP was close to running out of cash, sinking the stock 60% in two days.

The specific statement read.

As of April 30, 2018, we had approximately $15.5 million in available cash and approximately $27.9 million on deposit with our merchant processors for a total of approximately $43.4 million. The funds held by our merchant processors represent a portion of the payments received for annual and other extended term MoviePass subscription plans, which we classify as accounts receivable on our balance sheet and which we expect to be disbursed to us during the course of 2018. We believe that our average cash deficit has been approximately $21.7 million per month from September 30, 2017 to April 30, 2018. By the end of April 2018, we implemented certain measures to promote the fair use of our MoviePass subscription product, which we believe should reduce our monthly cash deficit significantly. These measures include a technological enhancement which prevents MoviePass subscribers from sharing their accounts with non-subscribers and allowing subscribers to see a movie title only once per subscriber using the MoviePass subscription. We believe these measures enabled us to reduce our cash deficit during the first week of May 2018 by more than 35%. In addition, by returning to our $9.95 per month unlimited MoviePass subscription, enabling subscribers to see up to one new movie title per day, we believe our subscriber acquisitions and subscription revenues will continue to increase for the foreseeable future. However, we will need proceeds from sales of our common stock pursuant to our Equity Distribution Agreement with Canaccord Genuity, or other sources of capital, starting in May 2018. Further, if we use all or a portion of the anticipated net proceeds from sales of our common stock pursuant to our Equity Distribution Agreement with Canaccord Genuity for acquisitions of other companies or financial interests in additional movies (through our subsidiary, MoviePass Ventures), we will need additional capital to offset our monthly cash deficit. In 2018, we expect our cash deficit from month to month will vary significantly based on the amount of movie tickets MoviePass is required to purchase for its subscribers during the month, the amount we spend on acquiring financial interests in additional movies through MoviePass Ventures, the amount we may spend on any other types of acquisitions, and our ability to develop the MoviePass business model in the near term generally, including developing and growing sources of revenue other than subscription revenue. Because the length of time and costs associated with the development of the MoviePass and MoviePass Ventures business model is highly uncertain, we are unable to estimate the actual funds we will require. If we are unable to obtain sufficient amounts of additional capital, whether through our Equity Distribution Agreement or otherwise, we may be required to reduce the scope of our planned growth or otherwise alter our business model, objectives and operations, which could harm our business, financial condition and operating results.

But many of us could not figure out WHY the company came out with this statement, and why NOW?!  There was very little new news in the statement.   If you break it down, the company said they will need to raise more cash, which they have already said they had planned to do by selling shares, and they said they would do this as they needed the funds.  So that was nothing new.   The cash burn level reported was also not new news.  Mitch and Ted have both said that they were burning in the $20M a month range in several previous interviews.   The statement also said that management had taken steps to reduce COGS, and that by adding the limitation of only seeing a title one time, and enforcing photos of ticket stubs, had reduced usage and fraud, helping to bring usage down more than 35%.   This was great news, but it had also been mentioned in prior interviews earlier in the week.  Nothing really new again!

So why then did HMNY – MoviePass -feel the need to release this 8K at all?   I have researched this, and the answer is that this is a requirement that they must fulfill by SEC regulation based on that fact that they are operating under a “going concern” audit finding.    The going concern part of this is nothing new.  In fact, it has been known for some time now.   What most investors do not realize is that once you have this finding attached to your company, the disclosure rules for the company change.

This is a complicated bit of accounting rules and regulations and if you want all the details you can read them here.  But the cliff notes version is that any updates both positive and negative that could significantly impact the “going concern” status of the company must be announced as they occur.    So the changes to MoviePass to reduce cash burn had to be disclosed.  And with those changes, the change to the cash position, and the intention to stick to the plan of raising more money with additional stock, also had to be disclosed.  Regardless of the fact that both of these things were already known by investors who were closely following the company.

To put a fine point on it – new developments that are POSITIVE – that will help reduce the “going-concern” issue with the company, must be disclosed.

Specifically —-

“The going-concern standard explains that these disclosures may change over time as new information becomes available and that disclosure of how the substantial doubt was resolved is required in the period in which substantial doubt no longer exists (before or after consideration of management’s plans). In addition, the going-concern standard states that the mitigating effects of management’s plans to alleviate substantial doubt should be evaluated only if (1) the plans are approved before the financial statement issuance date and (2) dboth of the following conditions are met: a. It is probable that management’s plans will be effectively implemented within one year after the date that the financial statements are issued. b. It is probable that management’s plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.”

It is reasonable to believe that Mitch and Ted actually believed that the filing was routine and that there was some substantially positive news in the filing that had only been mentioned one or two times in TV interviews, and this filing would make it official that MoviePass is making great progress in moving toward a more profitable future.

Unfortunately, the 8K hit within less than 24 hours of AMC CEO Adam Aron throwing MoviePass under the bus.   Adam made a bunch of nasty and false comments on how MoviePass was certain to be in a death spiral.  And made a bunch of false assertions on usage amongst other bizarre comments.

The timing could not have been worse for HMNY to release the 8K, it set off a literal $hit storm of bad headlines, causing retail investors to panic sell the stock.

Was this bad execution on the part of HMNY?  Probably – however as SEC forms go, it takes a few days to file them and companies may not know exactly what day the form will hit the SEC website.   So maybe it was just unfortunate bad timing.

Should HMNY and MoviePass do more to stop the stock price from falling?  Maybe, but there could be other restrictions they are under for releasing information.  We are close to ER, where there is normally a quiet period prior.  Also, we don’t know what is happening with the final acquisition of MoviePass and the rebranding of HMNY to MoviePass.  Also, we don’t know what is happening with the spinoff of Zone and if there is a quiet period there.

It is actually possible that this entire episode is very much ado about nothing.  And that Mitch and Ted both have their hands tied in how much more they can really say to calm investors fear of near-term Bankruptcy.   Afterall, Farnsworth and Lowe have both stated in separate interviews that they are confident they have plenty of options for additional funding and that they at least are not worried at all about insolvency.

My conclusion, the drop was scary and shook out a lot of early shareholders and retail investors who just don’t have the stomach to take these kinds of losses, even if they are just on paper until you sell.  The series of events was a great gift to the short sellers who are paying big money to short this stock because they don’t believe in the model, or they have ulterior motives for wanting to have HMNY not be successful.

It seems unlikely that HMNY is headed for Bankruptcy anytime soon given they have virtually zero debt, and a lot of options to keep on trucking as a “going concern”.

My view – if you liked this stock at $7 or $4 or even $2 – you should love the stock NOW at .85 cents!

Nothing significant has really changed!   Go review all the video interviews I have cataloged here.   You will see that the story has been consistent, that there was really no big new news at all, and that Farnsworth and Lowe consistently have said they would need to raise more money as they built out a 5 Million user subscriber base.

Don’t let greedy Wall Street hedge funds and sneaky short attacks from competitors like AMC scare you out of what will be a great long term investment!   Hang in there, average down if you can stomach it.

As Mark Twain once said.

“The rumors of my death have been greatly exaggerated”

What the heck is going on here! Is MoviePass really going BK?

The past couple weeks have been admittedly rough for HMNY investors.   I have continued to stay long, but I have not been enjoying the ride much.  My time horizon is multiple years, and I still believe longterm MoviePass has a very good chance of not only surviving but thriving.  Today was particularly ugly with the 8K filing that set off alarm bells for longs and gave shorts another day in the sun to predict near-term doom for MoviePass.   AMC’s CEO Adam Aron bashing the company and spreading more FUD, also did not help matters much either.   The mainstream press seized on  the 8K filing, and went for blood with scary headlines predicting near-term bankruptcy.

Spoiler – I do not think MoviePass is headed for Bankruptcy.   I still believe the MoviePass model can and will work.    I have said it before, MoviePass really should not be a public company yet.  And in many respects, they really still are not fully a public company.  But by Proxy – via HMNY they are close enough.  At least for retail investors who have wanted to get a piece of the action on MoviePass’s business.

I am pretty sure there are a whole lot of HMNY investors who are kicking themselves right now.  Wishing they had stayed away from this stock, and who could blame them given the rapid descent of the stock price.   So far, the bears have been right, and shorts have made good money betting against MoviePass.

I still believe we are in very early innings for MoviePass.   And while I think it is problematic for the company that shares have dropped to this low level, I don’t think it is a catastrophic situation.   The short attack on the company has undoubtedly been successful, and it has put the company in a more difficult position for raising funds.   There is no way to escape it, this makes things harder for MoviePass.  Selling shares on the cheap is a rough way to raise money, and convincing lenders to fund further sub growth will be difficult and expensive given the scary headlines.    I expect to see this narrative linger for at least a few months.  Maybe until the end of the year.  Yes, it will come with dilution, and it could also come with share price staying under pressure.

I don’t see bankruptcy as a likely outcome here.  The primary reason is that the company has no debt.   So really only HMNY management can decide if they want to try and take BK route if things get that bad, but by doing so, they gain very little.   Hell, at this point, even the whining about Farnsworth’s market cap incentives seems wildly misplaced.   At the current market cap of about $78 Million – Farnsworth will get exactly ZERO from his market cap bonus structure.  At this point, I would love to see nothing less than a 100% payout to Farnsworth if he can hit these goals!

I continue to believe that Farnsworth and Lowe have a LOT of levers they can pull to further reduce the cash bleed, while still maintaining reasonable subscriber growth.    Do remember that the MoviePass terms of service give the company a lot of options for changing the service in any number of ways.   Removing the ability to see a movie more than once, and forcing photos of ticket stubs were successful in bringing ticket COGs down by 35% – I believe the company can go even further to reduce COGs.

A few ideas for further reducing COGs

  • Have one day a week where only partner theaters are available for MP subscribers.   This would give a great bonus to those who are playing nice with MP, and it will sting the chains who don’t play nice.  It would also reduce consumption 4 days a month.   I think they could do this without infuriating the subscriber base.  MoviePass just needs to be open and honest with subscribers, and communicate with them upfront prior to making a move like this.  People LOVE their MP, and if well guided, they will help do their part to keep the company in business.
  • Block opening weekends for more big blockbuster films.   I know many will howl at this, but I contend that a very large number of MP customers will not care if they have to wait 2-3 days to see the big BB film.  By doing this, it will reduce some consumption, and will also offer more value to chains, helping them fill more seats that would otherwise go unfilled as perishable inventory.
  • Cut off some AMC theaters where there are obvious good alternatives – if a deal can be struck with competitors Regal etc.   AMC is trying to kill MoviePass with a smear campaign, and playing hardball here will be understandable by most MP customers.  Again, MP needs to step up the PR machine here and get the customer on their side.   They are just not doing enough to make their loyal customers part of the solution.
  • Encourage Customers to be part of the solution to reduce costs!   Ask loyal customers to frequent matinees when convenient, use MP like you would use your own money.   Honestly – I think a lot of customers would be happy to help if it means the company stays viable.

There are other much more draconian ideas we could all think of to reduce costs, but obviously, the company does not want to take any measure that will kill its ability to scale.   That said – if the decision is BK or more draconian cost reductions, particularly to slow down the heavy users – MOST will accept the draconian measures over BK.  And remember, 88% of the subs are not a problem, we are only trying to slow down the hogs!

  • Simply start kicking out the heavy users.  If they are month to month users, don’t renew them.  Offer the heavy user a $29.99 plan.   I think about 1/2 would take it.
  • Start restricting the movies that heavy users can see.  Limit their options and limit the theaters they can go to.    Yes that sounds harsh, but to avoid BK, MP may need to start getting harsh with the hogs!

The point is – there are a LOT of levers, and a lot of options for MP to stay in business and provide an excellent value to the vast majority (88%) of their customers who do not drain the bank every month.   Making the talk of any near-term BK very unlikely.

Things are not quite a pretty as they were a couple months ago.  The share price has fallen far below where I thought it would fall.   But I think the story still works, I think the business model can still work with some tweaks.   I have not given up.

Finally – if you believed that MoviePass would work from my previous models.  Which of course I do believe, than you should now love the stock even more after MoviePass has successfully implemented the cost reductions they now have in place.

From the  NY POST article today:

Farnsworth, however, disputed AMC’s figures, saying MoviePass members had actually visited the chain an average of 1.8 times in April.

He added that MoviePass has slashed that number to 1.13 since it began cracking down on users who have been sharing their memberships and watching the same movie more than once.

“Anything below 1.5 for us is great, because you can make it up with other revenues” from marketing deals and other corporate tie-ins, Farnsworth told The Post.

I understand a lot of people are scared, and they don’t trust Farnsworth anymore, and I can’t totally blame investors for that.   However, if pressed, I find only a very few things where Farnsworth has not been totally clear, and I have not seen flat out lies.  Missing projections does not equal a lie – BTW.   That is why they call it an earnings miss.  Not an earning LIE.  They are guesses at the future.   Is Farnsworth a bad guesser?  Maybe!  Has he been wrong with other businesses in the past, yes.   Does he deserve the benefit of the doubt when he speaks about MoviePass now, only you can decide.  But if you truly don’t trust the CEO and think he is a liar, I would avoid the stock anyway.

So I have an updated model on the model page with 1.13 Utilizatoin rate.  And that looks very promisting indeed.   It all depends on who and what you want to believe.  That hasn’t changed!

 

 

 

Adam Aron’s (AMC CEO) Bizarre Responses to MoviePass Subscription Questions

AMC had a pretty good quarterly report today.   Box office – and ticket admissions did better than expected.  Not so surprisingly Adam Aron took a few shots at MoviePass – a service he would love to see go away as it threatens AMC in a way they don’t like and don’t fully understand.   Aron seems to revel in the better than expected Ticket and Box office numbers beat for the quarter, while also tacitly acknowledging that MoviePass was a significant driver of his business.    While at the same time trying to deny the popularity and acceptance of MoviePass, all while trying once again to throw the company business model under the bus.  Desperately, and probably stupidly,  wishing they entire thing would just go away.

First, let’s just take a look at some of the numbers here.

As you can see, US Market Attendance was actually down to 61.5M from 68.8M.  Aron raised ticket prices from $9.27 to $9.78.   All underlying Aron’s strategy of reducing seats, upgrading some of AMC theaters and get more money out of every moviegoer.   It is his strategy to actually REDUCE moviegoing.  And I give him credit there! – he has achieved his goal of fewer people going to his theaters.

Now – here are some quotes from the conference call, that demonstrate how far a CEO can delude himself from a near-term reality he must face.   And that is, like it or not, MoviePass success at AMC, has become the success of AMC.  That is, Aron can’t have one without the other.  He knows it and is having a harder and harder time dancing away from it.

From Today’s Conference Call

Ryan Sundby

And then I guess I hate to be the one to go here, but I am surprised we haven’t hit on subscription this late into the call. Any color you can provide on what subscription services going to add to the quarter? And then any thoughts on how you see that evolving now that we see a new entrant into the subscriptions game as well, I guess?

Adam Aron

I have been waiting for that question the whole call. So thank you for asking it. We have had a very successful subscription program for three years in the United Kingdom, called Limitless in the Odeon circuit. And our views about subscription have not changed 1iota since the August press statement that we put out on the first day of movie passes, in my opinion, ridiculous price reduction. We said go back and look at our statements. We said that there’s nothing wrong with subscriptions programs. They can be quite positive actually if they’re done rationally and intelligibly. But they have to be done at a price that is sustainable. And it was our view that 995 for up to 30 or 31 movies a month is not enough money to spread around MoviePass, Hollywood studios and theater operators, so that Hollywood can make quality movies and theaters can operate quality theaters.

Fast forward to today, in March and April, MoviePass paid AMC $12.02 per ticket on hundreds and hundreds and hundreds of thousands of tickets each month, hundreds of thousands of their subscribers came through AMC theaters to enjoy our product. They did so at a frequency of 2.62 times in March and 2.75 times in April. Now, I took the calculator out and I multiplied 2.75 times $12.02, and I got to a number that was considerably larger than 995. So just as we were hearing that — the MoviePass price point was unsustainable in August, we have the same questions today. And apparently we’re not alone in that view. Our doubts are now shared and articulated by MoviePass’s orders.

OK, Aron – we know you hate MoviePass! – you have made that very clear, and you hate that it has a model that can result in lower prices and you refuse to acknowledge that the lowering of price can result in higher demand – even as it seems to be showing up in your theaters and driving better than expected attendance numbers at your theaters.   (Hitting my head against the wall now!)  But at the end of your statement, you now claim that your doubts are now “shared and articulated by MoviePass orders”?!    And you back it up with no data whatsoever?   And what do you mean by “shared and articulated by MoviePass’s orders?”  I mean seriously, what do you mean?   Are you saying MP subs are down?   Because that is a pretty bold claim – given MP has not backed down from their sub growth #’s at all.    Or is Aron saying that AMC is seeing fewer ticket sales from MP?  That seems counter to his other previous claims of hundreds and hundreds of thousands of tickets.   Is it just me, or does it seem like Aron has a hard time splicing all of this BS together to a coherent argument on why MoviePass sucks, other than he hates it, and does not believe in lowering prices to drive up demand?

Aron also states that MoviePass is paying $12.02 per ticket while also claiming in AMC’s own reports that the average ticket price is $9.78.   I am starting to smell a rat here.   How could MoviePass be paying more than $2 over AMC’s average ticket price?  Particularly when MP does not allow for 3D or Imax viewing?  Something stinks here.  Either Aron is lying, or he is knowingly ripping off MoviePass.  I don’t see how either of these things can last.  I know some will say the price difference is for regional higher prices where MP is more dominant, but I don’t buy that argument, not when you take out 3D and Imax.

Now – if MoviePass paid for “hundreds and hundreds and hundreds of thousands of tickets each month” what would have been the result had MoviePass aggressively redirected those subscribers to other theaters?

Let’s do some conservative math on that statement against the reported numbers.   Since we Aron won’t give a real number beyond hundreds and hundreds of thousands.   I will pick some conservative numbers to work with.

If you assume that MP brought in the mid-range of “100’s of thousands” of tickets each month, at the $12.02 price point Aron claims. If you add to that a conservative Halo effect of 20% (For friends who go with MP subscribers that probably would not have done otherwise)  That would amount to about $23M in tickets sold by MP in the QTR.   A significant amount for the company to be sure.  If you add to that the average $5.04 concessions the company claims, it amounts to another $9.6M.   This is all VERY conservative estimates.   And the total estimate here would be just over $32 Million for the QTR that can be DIRECTLY attributed to MP.    And for those people who say that these people would have gone to the theater anyway without MP, I say, you are nuts and delusional to think that way.  The data is absolutely 100% clear MP customers double their movie consumption after signing up with MP.

Ticket Revenue Concessions
MP Tickets Sold Halo Effect 20% Total Ticket Sales  $                12.02 $5.04
Jan           500,000            100,000               600,000  $    7,212,000.00 3024000
Feb           600,000            120,000               720,000  $    8,654,400.00  $ 3,628,800.00
March           500,000            100,000               600,000  $    7,212,000.00  $ 3,024,000.00
Totals        1,600,000            320,000            1,920,000  $  23,078,400.00  $ 9,676,800.00  $ 32,755,200.00

 

The question is would this relatively small estimate of increased revenue make a difference to AMC’s results.  And the very clear answer to that question is absolutely yes!!  In a very big way.  AMC posted earnings of 14 cents per share, topping the Wall Street consensus estimate of 9 cents per share by 5 cents per share. Net earnings were $17.7 million for the period.  That’s right net earnings were $17.7 Million.    So does $32 Million of additional revenue make a big difference to AMC?!    I think the answer is obvious.   Without MoviePass AMC almost certainly would have missed Wall Street consensus, and instead of seeing a nice lift in stock price, they likely would be getting crushed in tomorrow’s trade.

And for those who say, you can’t just add that additional revenue straight to Net Earnings, I say, you must consider that MP sells perishable inventory that AMC likely would not have otherwise sold.  Meaning a HUGE amount (almost all of it) goes straight to higher profits for AMC.

So while Aron continues to hope that MoviePass goes away, he also must secretly be thankful that MoviePass is saving AMC’s bacon by goosing their numbers.  Aron can’t seem to wrap his head around the idea that a whole lot of people would like to see more movies at a more reasonable price.  He is blind to his own strategy of raising price, reducing audience, and slowly killing off all but the most passionate theatergoers.

I have seen this movie before, where the old laboring incumbent just can’t wrap their heads around a new business model that is likely much better for them.  The disrupter just keeps charging forward, and finally deals a crippling blow to the old guard.     AMC is now very vulnerable to MoviePass, Aron knows it, and it is why his statements continue to get more bizarre and more paranoid.   The more Aron continues to bash MoviePass, the harder it will be for him as CEO of AMC to walk back his comments and do a deal with MoviePass under his watch.

I believe MoviePass is nearing or already at a point where they could do serious damage to any one of the major chains by seriously reducing consumption at any one of them for a sustained period of time.  That is a nightmare scenario for Aron, who has come out swinging hard against MoviePass and shows no intention to back down.

I expect a showdown soon enough!

Chapter and Lesson #2

“Winners quit all the time.  They just quit the right stuff at the right time”  

Seth Godin  

 

In 1994 I finally woke up and realized what the birth lottery had gifted to me!  I lived in the Seattle area, in the midst of the PC revolution, and we just happened to have the leader and the most profitable company of that revolution right under my nose called Microsoft!! So, when I finally clued in and figured out that PCs were going to be big, really big!  I thought, what the hell, I better find a way to join Microsoft again.   While I was incredibly stupid, at least I was smart enough to see that this PC thing was really starting to catch on!     Add to that, my young beautiful wife had already started working at Microsoft in sales, where she had run into an old High School friend of mine who was working there as a manager in Product Support, and one thing led to another I was hired back to Microsoft 2 years after my first contract job with the company had ended.  

Now I was starting over at Microsoft, with a job that may have even been worse than the first one I had started with!  At least at this point, I had the good sense to quit the dead-end job I had in Aerospace and move on.  It was sort of a second chance for me to make something of myself.   

This was not the worst path for me to take.  After bumping around in the Aerospace business for a couple years, I saw how difficult it was to grow a career in a mature industry.  I was working for a sales manager who had been in aerospace for more than a decade already and had only moved up far enough to be my boss.  He was a nice guy, but his spirit was waning, and he knew his boss had to quit or die before he was going to get another bump up the old corporate ladder.  The environment was depressing, the old-timers at the company had that glazed look in their eyes, of a life wasted.   

As it turned out, the Aerospace company I was working for was going through a rough patch of their own.  The company had just lost their most important patent while I was working there and was about to lose their largest customer as a result.  Unfortunately, the very day that the company’s most important patent expired, their biggest customer, The Boeing Company, called up the CEO and told him that they were now going to take all the product they had been buying from us in the past and do the work “in-house”.  Boeing told the CEO that they had been waiting for this day a long time and that they had felt they were been being ripped off for the past 20 years!   It was a hard day for everyone at the firm. 

That very same day, the CEO of that small aerospace company called an emergency company meeting, it was just before Christmas and he broke the news to the entire 120-person company.  For many of them, their careers were over, about half of the staff would have to be let go, there would be no end of year bonus, and the Christmas party had been canceled.   It was a grim day for the people who had spent a good part of their life working for the company.  Some were crying, some were mad at the CEO for not steering the company in a brighter more prosperous direction.  It was a wake-up call for me.

I was sort of glad that the company was likely going to lay me off.  I couldn’t stand the job, and I could see that whatever my future was going to hold, this job was not going to make it very bright.  Also, the CEO and founder of the company was a greedy and grouchy old guy.  And I thought to myself,” if this guy is the best that one can aspire to here, I really need to think hard about getting out this place”.  

One of my favorite stories of working at that company was a time when I had gone to the breakroom to cook up some microwave popcorn.   I then brought the popcorn back to my desk to snack on while working.  As soon as I got back to my desk a fellow sales trainer/corporate slave came running up to my cubicle in a bit of a panic.  He told me that the “old man” (that’s what we called the owner and CEO of the place) HATED the smell of microwave popcorn!  He had a strict rule about not bringing it into the offices from the break room area.  This guy was dead serious and seriously worried about me, I could be fired for eating a bag of popcorn at my desk.  I laughed, I sat down and ate the entire bag of popcorn, and I thought to myself, I am not going to last very long at this place.  I quit Friday of that week same week.  I told my boss I planned to start my own company.  But really I did not have a plan.  I just knew that I could not stay at that company any longer, it was never going to go anywhere, and I did not like the work anyway.

This all made me appreciate the Microsoft opportunity so much more than I would have if I had not had this experience.   I think it also motivated me to try to be a much better employee and work harder to impress my superiors when I had a good opportunity.   Yes – I was slow on uptake, but the learning lesson was a valuable one.

Learning Lesson #2 –  If you find yourself in an obvious dead-end situation, QUIT!   Had I not had the good sense to quit what was a decent but dead-end job in Aerospace, I would never have had the chance to have my incredibly fortunate and lucky run at Microsoft.    The old saying “winners never quit” IS WRONG! —winners do quit, and quitters do win.  Quit often and start over when it makes sense to do so.  Timing is important, and so is luck.   If you are having trouble knowing if you should quit.  I recommend reading The Dip by Seth Godin

  Throughout the rest of this book, many of the learning lessons I write about are meant to help you identify if you are in a winning or losing situation.   And to help you find your way to areas and scenarios where you can win.  Believe me, there were a lot of people who were better at timing and getting luckier than I did at Microsoft, even when I was damn lucky to get what I did! 

Others I knew at Microsoft were even more amazing at timing.  Those who left to join Google, as an example, just as Microsoft’s hypergrowth was ending, were particularly impressive to me.  It’s hard to know just when the right time is to jump to a new opportunity, but if you really watch for the signals and ACT on them, you will be better off for having left a job that is dead or dying and take that jump toward moving to a better future.