Business help

[happychap]

marshalla said:

Sounds like a classic case of someone who's good at providing the service, but not at running a business.

Could you afford to spend some time with him going through his books, finding who hasn't paid, chasing them up, and helping him to get his records & processes in order ?

That would be a great way mentoring him and enable him to become more rounded in developing his business and personal development. What is it that other than losing your money that stops you making an advance of part of the amount he has asked for, I understand that its a gamble and putting trust in him.

[Camoradi]

Why not go into business with him. He does the work, you run the financial side of the business and provide working capital for materials etc. That way your risk is with his customers and not him.

[Simon Brooks]

Had something similar years ago, friend approached us to borrow money to settle tax bill, which they had ended up with because of poor management of partnership business at their end, basically his business partners bunked without paying tax. Mr IRS played the jointly & severally liable card and came after the partner they could locate. On his behalf and with his blessing I dealt with his revenue officer and agreed a settlement plan over an extremely long period without accruing additional interest/costs or further penalties at the point of agreement, I had assumed that this would be acceptable as the debt would in effect be a repayable loan subsidised by IRS. Unfortunately the friend wasn't happy with this solution and wanted us to still lend him the money so he pay them direct and clear his debt outright with IRS. At this point the friendship faded away. I think this was probably a case of right decision at the right time for the right reason

Lending to friends/colleagues just doesn't work, far too easy for the lines between friendship and business to get too blurred

[FrankAbagnale]

Simon Brooks said:

Had something similar years ago, friend approached us to borrow money to settle tax bill, which they had ended up with because of poor management of partnership business at their end, basically his business partners bunked without paying tax. Mr IRS played the jointly & severally liable card and came after the partner they could locate. On his behalf and with his blessing I dealt with his revenue officer and agreed a settlement plan over an extremely long period without accruing additional interest/costs or further penalties at the point of agreement, I had assumed that this would be acceptable as the debt would in effect be a repayable loan subsidised by IRS. Unfortunately the friend wasn't happy with this solution and wanted us to still lend him the money so he pay them direct and clear his debt outright with IRS. At this point the friendship faded away. I think this was probably a case of right decision at the right time for the right reason

Lending to friends/colleagues just doesn't work, far too easy for the lines between friendship and business to get too blurred

As odd as it sounds, whenever I lend money to a friend I write it off. I never expect it back, although make a mental not of those who do/don't settle their debts.

[Matt UK]

Camoradi said:

Why not go into business with him. He does the work, you run the financial side of the business and provide working capital for materials etc. That way your risk is with his customers and not him.

My thoughts exactly. If he is good on the tools but crap in the books, it could be a good win/win.
He sounds like he needs a regular salary.

Edited by Matt UK on Thursday 5th March 15:09

[Simon Brooks]

FrankAbagnale said:

Simon Brooks said:

Had something similar years ago, friend approached us to borrow money to settle tax bill, which they had ended up with because of poor management of partnership business at their end, basically his business partners bunked without paying tax. Mr IRS played the jointly & severally liable card and came after the partner they could locate. On his behalf and with his blessing I dealt with his revenue officer and agreed a settlement plan over an extremely long period without accruing additional interest/costs or further penalties at the point of agreement, I had assumed that this would be acceptable as the debt would in effect be a repayable loan subsidised by IRS. Unfortunately the friend wasn't happy with this solution and wanted us to still lend him the money so he pay them direct and clear his debt outright with IRS. At this point the friendship faded away. I think this was probably a case of right decision at the right time for the right reason

Lending to friends/colleagues just doesn't work, far too easy for the lines between friendship and business to get too blurred

As odd as it sounds, whenever I lend money to a friend I write it off. I never expect it back, although make a mental not of those who do/don't settle their debts.

I might well have done that, unfortunately this was a reasonably successful 3 person partnership that hadn't set aside any cash for the inevitable demand, from memory it was a sizable chunk of money, as my dear old dad often quoted from Hamlet

"Neither a borrower nor a lender be,
For loan oft loses both itself and friend"

[akirk]

without knowing someone, it can be difficult to advise, but if he is conscientious at his work etc., then as others have said it is lack of financial management / business skills... I would suspect therefore that the issues may well run deeper. If I knew him I would offer to spend a couple of hours one evening helping to draw up a summary of the issues / etc. and then use one of the many debt advice services to help negotiate a repayment - once that is in place it is possible for someone to see blue sky again, when it looks more optimistic then they find it easier to climb out of a situation - but forom the sound of it he needs longer term help on that side of his work...