As a business owner of Troubadour Goods, cashflow means everything to sustaining and growing the company. When one of our retail partners filed for Chapter 11, I knew we could submit a proof of claim as a matter of recourse to recover the unpaid invoices owed to us.
Because this wasn't our first encounter with bankruptcy, I was not too optimist about the prospects of getting repaid. Last time we were involved in another bankruptcy restructuring, the unsecured Creditors in the case basically received nothing.
Last time we were involved in another bankruptcy restructuring, the unsecured Creditors in the case basically received nothing.
However, this time was different. Shortly after we filed our claim, we got an email from XCLAIM and a few different folks reaching out and expressing interest in buying our debt. I didn’t have the time to fully analyze how much our claim was worth. My assumption was that if we waited, there eventually might be a chance that our claim could be worth more than the offers we had received. But given our past bankruptcy experience, there's really no guarantee.
I had subscribed to getting regular email updates from the Stretto claims agent website, and I noticed that other Creditors were selling their claims. So we understood that transactions were happening in this bankruptcy case.
...I noticed that other Creditors were selling their claims. So we understood that transactions were happening in this bankruptcy case.
A couple of catalysts really got us to think about selling our claim. One was just year end, we clean up our A/R and A/P anyway. So maybe we clean this up and don’t have this extra receivable just sit around. Secondly, I read an email from XCLAIM stating the average time to resolve a bankruptcy and get paid was something like 2 years. Considering this, I really didn’t want to wait 2 years.
I started to do some research on the other offers we received. I'm not very knowledgeable about bankruptcy restructuring, and it started getting more complicated than it was worth. It got me thinking, is it really worth spending a day researching this?
In comparison, all the other offers we got in the mail were around the same ballpark in price, about 20% less than the offer through XCLAIM.
At the same time as I was deliberating, I received emails that one of the Buyers on the XCLAIM Marketplace had stepped up their offer price for our claim. In comparison, all the other offers we got in the mail were around the same ballpark in price, about 20% less than the offer through XCLAIM.
By now, I knew I wanted to sell our claim and doing so on an online marketplace made the most sense to me. I used the chat on the XCLAIM website to clarify a couple of my questions, and it was helpful. I primarily wanted to know if there were any fees with transacting on the XCLAIM Marketplace.
But at the end of the day, we got the certainty and we got the cash sooner than if we had waited for the bankruptcy to resolve.
After confirming there is no-cost for us to sell, I made up my mind. It was sensible. It was straight forward. There were no red flags. Once I accepted the settlement offer through XCLAIM, it was very seamless to getting paid. In fact, the process was so easy that I thought, maybe I should have asked for more? But at the end of the day, we got the certainty and we got the cash sooner than if we had waited for the bankruptcy to resolve.
Overall, XCLAIM was professional, easy to use, and had no fees for Creditors. It was a really positive experience. I would definitely use it again. But hopefully in the future, we wouldn't have any more bankruptcy claims to sell.
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