Four Sheriffs
People would come to Nolan Bushnell saying they had real problems. They were thinking about declaring Chapter 11.
Bushnell would ask: how many sheriffs do you have in your lobby?
When you stop paying bills, people sue you. When they get a judgment, a sheriff comes in with a piece of paper, sits in your lobby, and takes any money that walks in the door. Atari in the summer of 1974 had four of them sitting there.
Atari in the summer of 1974 had four sheriffs in their lobby. So you haven't even started to have problems yet.
The Paycheck Race
Cash flow was so tight that it became normal for Atari employees to sprint to the bank at lunch on Fridays.
If you were not the first one to cash your paycheck, it might bounce. That was just how things were.
Everyone remembers the success. Nobody remembers the months where the founder was wondering if the checks would clear.
It became normal for everyone to rush out at lunch with their paycheck on Friday to be the first ones to the bank.
Survive and It Happens
Bushnell said the people who make it are not the smartest or the best funded. They are the ones who refuse to quit.
They struggle through. They survive cash crunches and lawsuits and bounced checks. And somehow, they come out the other side.
Atari went on to define an entire industry. But in 1974, it was a company where the sheriffs outnumbered the executives.