Wall Street artfully
Saturday, November 8th, 2008Wall Street artfully
But while Butler wooed Wall Street artfully, he neglected his core customer: the Q-Entertainment franchisees. By 1996 they were up in arms because the service from headquarters was “lousy and expensive,” says Zac Adams, a former franchisee manager for the Southeast. Q-Entertainment failed to deliver adequate technical support and marketing materials and lagged behind its competitors in implementing updated laser-gun technology, former company insiders say.
As competition heated up, Butler struggled to maintain market share. In 1997 he opened only 8 American centers, down sharply from 25 the year before. “Word was out on them, and few seemed to want to buy in,” recalls Guthrie.
But Butler, who could not be reached for comment, was not easily deflated. He gambled big on Q-City, a vast “family entertainment center” that he opened in Mesquite, Tex., in March 1997. It boasted a laser-tag center, video games, and a bowling alley. But because of its location in a working-class town that prohibits the sale of beer and liquor, it lacked the alcoholic-beverage license that is frequently the linchpin of such a venture. Q-City fizzled quickly.
Four days after Christmas last year, Q-Entertainment entered Chapter 7 bankruptcy, heaving its last. Like a laser-tag victim, however, the business (if not the company) may rise again. An investors group that includes some former Q-Entertainment employees is negotiating to buy the company’s remnants and may resurrect the business under the name New Q Inc.