WOW’s Founder Could Lose ISK 4 Billion
Skúli Mogensen, founder of WOW Air, issued a statement yesterday regarding the airline’s bankruptcy. In it, he admits to being largely responsible for the airline’s troubles.
In the statement, he reviews what could have been done differently. He mentions the huge expenses and complications involved in offering flights to distant places, such as Los Angeles and San Francisco. The airline, he states, gradually moved away from the low-cost model, which proved costly.
He admits that the airline should have used profits made in 2015 and 2016 to strengthen its finances before expanding further.
He states that he, personally, invested about ISK 4 billion (USD 33.5 million; EUR 29.8 million) in WOW Air since its foundation, and that most of that investment is now lost.
As late as September, 2018, he bought stock in the company for ISK 750 million, with his house and his land in Hvalfjörður as collaterals.
“I will probably have to sell both of those to live up to my commitments and with regard to WOW Air. I put everything at risk in this effort,” he writes.
He says it’s very hard to see the company go under, for he loved the airline, the people and all it stood for. “We transported more than 10 million passengers from the beginning and brought more than two million tourists to Iceland. WOW created thousands of jobs, both directly with the airline and for the tourism industry as a whole.”
He believes he was close to turning things around in the end, but that he ran out of time when it came to financing.
He writes, “For the rest of my life, I must live with the decisions I made, but what I find the worst is to have failed all the people who stood by me and fought till the end to save the company. This was and remains a unique group, with whom it was a privilege to work.”
He concludes by saying, “I hope that despite how our adventure ended, other entrepreneurs won’t be discouraged from making their dreams come true.”