Attila van Unruh, a serial entrepreneur living in Germany, has found his latest business success from an unlikely source: bankruptcy. According to the English version of the German paper Deutsche Welle, van Unruh came to his latest venture after having to declare bankruptcy because of an employee’s mismanagement of funds in one of the businesses he’d started.

At the time he filed for bankruptcy, van Unruh had opened an airline extension, a catering business, and a restaurant chain. Perhaps unsurprisingly, he saw his experience in bankruptcy as a way to help others—and started another business.

Harsher Bankruptcy Penalties in Germany

We’ve often remarked that American bankruptcy protection is an integral part of the fabric of our culture—our bankruptcy laws are relatively lenient, compared to those of many other countries, and as such encourage greater business risk-taking than in other parts of the world.

In Germany, however, those who file for bankruptcy may not be able to rent an apartment, get a cell phone contract, or conduct other essential business of everyday life for several years following their petition. The German bankruptcy process lasts six years, compared to as little as six months in the U.S.

When he entered bankruptcy protection, van Unruh discovered those depressing and discouraging realities firsthand—and he decided to do something about them.

He launched the group Insolvents Anonymous, which, since its inception, has:

• Provided those in bankruptcy a forum to discuss their fears, frustrations, and experiences.
• Established a network of counselors to help business owners with financial, personal, and emotional matters relating to bankruptcy.
• Expanded to harness the knowledge of the thousands of entrepreneurs who have benefited from its services to provide essential information to other business owners and prevent future bankruptcies.
• Spread to 10 German cities and parts of Austria. The group has reportedly helped at least 5,000 entrepreneurs already.

The Push for Bankruptcy Law Reform

It seems that van Unruh’s timing in creating Insolvents Anonymous was just right: as the economic crisis worsened, his group expanded and became relevant to more Germans and Austrians than in the past.

At present, van Unruh has apparently secured sponsors for his services and is pushing for a modification in Germany’s bankruptcy laws so that they more closely resemble those in the U.K. or France. One major point he’d like to see addressed? The waiting period before starting new business ventures.

After six years of bankruptcy, German filers must wait three additional years before starting a new business, a restriction that could hamper a filer’s ability to recover financially from bankruptcy.

Whether or not van Unruh succeeds remains to be seen, but his outlook, in some ways, seems rosy: much of Insolvents Anonymous’ current funding comes from “graduates” of the program who have gotten back on their feet and are able to give back to the group. This alone suggests that van Unruh is on to another winning proposition.