With Christmas over and the new year approaching fast, it’s customary to make some New Year Resolutions. If these are to be meaningful and offer benefit, rather than be hollow and get forgotten, it perhaps helps to base them on lessons learned in the year just gone.
I will therefore share with you here the five main lessons that I have learned this year, and the New Year Resolutions that I am making based on them:
Lesson & Resolution 1 – Take Opportunities
Look for opportunities and seize them with both hands, you may be surprised just how far one small step can take you on a big journey.
I took a small step in November last year when I attended a free seminar, which led to me investing there in some personal development training that took place in January this year with one of the speakers. Whilst on that training I made a chance contact which led to me taking more steps, making an investment and a small profit. Whilst making that small profit I made more contacts, and so the snowball started to gather speed.
This was all good news but I also learned that my chance contact was far from what he portrayed himself as, and my profit could have been greater had he been more honest with me. My mistake was trusting that person too much, because he wasn’t worthy of it (see Lesson & Resolution 3 & 5).
I still made a profit though, and getting paid to learn can’t be all bad
So for next year I will: Continue to look for opportunities and seize them with both hands when I spot them (but see also Lesson & Resolution 2).
Lesson & Resolution 2 – Research Thoroughly
Do your research very carefully, properly understand your market before buying, and always ensure that Plan B will provide a reasonable exit strategy if Plan A doesn’t work out.
In simple terms be sure that you understand exactly what your market wants, in the area where you intend to buy, before you do so. And know that just because you get lucky once, it doesn’t mean you will again.
Following one quick refurb & flip in an area I decided it was good for another and, spotting an opportunity, grabbed it quick at a bargain price. The refurb was quick enough, far quicker than the previous one, but a buyer was slow in coming. The agent offered many excuses, but that didn’t find a buyer either, so the solution was obviously to get a tenant instead.
With hindsight the problem was that the area does not attract owner-occupiers, and I’d only sold the first property so quickly because it had been bought by another investor. So it was just as well that I had (before purchase!) ensured that rental was a possible exit strategy too… Let’s face it, no businessperson wants an asset just sitting idle.
So for next year I will: Better understand my target market before buying the base product (and continue to ensure the viability of my Plan B as that’s all that saved me this time).
Lesson & Resolution 3 – Written Contract
People are very rarely what they first seem, the real person often doesn’t match up with the public persona, so always dot every ‘i’ and cross every ‘t’ in writing regardless of what promises you are made verbally or by whom.
I’ve personally encountered this learning twice so far this year, in quite different ways:
- I met “an ordinary bloke” (who has subsequently spent much of the year trying to elevate himself to “guru”) status. He first obtained my trust, then offered to help me out, and did to an extent whilst simultaneously ripping me off (a lesson for him to learn is that if he’d played a longer game I’d probably still be his client now and he’d ultimately be making far more from me, but that’s a post for another day).
- I signed up with, and paid a deposit to, an established “guru” who had publicly promised all manner of things. Four months later he asked for more money before he would deliver. Two months after that it became apparent that yet more money was needed. I twice tried to meet face-to-face to ask for my money back, and twice failed through no fault of my own. I’m pursuing this in email at present.
Incidentally, the “ordinary bloke cum guru” introduced me (with hindsight most unwisely for him, making this his second mistake with me in a relatively short acquaintance!) to a long-standing business acquaintance of his, who (together with his best mate) told me a huge amount of stuff about “ordinary bloke cum guru” and his numerous past mistakes, professional conduct and ethics. Quite possibly sufficient to sink his new-found “guru” status. If he’s reading this, it’s one of his lessons for the year!
It seems I have learned that it really doesn’t matter who is involved, how credible them seem, or how high/low their public profile, because a handshake, or gentleman’s agreement, is unfortunately just not sufficient with some people. Henry Kissinger summed this up well when he said: “It’s not a matter of what is true that counts but a matter of what is perceived to be true.” I was fooled twice this year, I won’t be fooled again.
So for next year I will: Always ensure that a proper and fully detailed contract is in place, or at the very least a bespoke and signed Heads of Terms, (and most definitely not someone else’s heavily one-sided standard T&Cs, regardless of their status) before entering into any new professional relationship.
Lesson & Resolution 4 – Friendship & Business
Don’t work with friends. If a business contact later becomes a friend, that’s fine, but don’t try to turn a friend into a business contact.
I gave a friend who was down on his luck a chance, by giving him work. I had confidence in him. I genuinely believed that he had what was needed to run a project for me, and that it would give him and his family the opportunity they needed for a fresh start.
Perhaps my own professional judgement was clouded by my desire to help a friend, because in practice he failed to drive the project forward hard enough, failed to watch the budget closely enough, and took the money for as long as possible. Ultimately I’m grateful that he had the decency to quit just in time to save me firing him, which would have been a very hard thing to do with a friend (even though I find it easy with subcontractors).
So for next year I will: Continue to help, guide, advise and coach my friends but I will not – however good an idea it may at first appear – offer work to any of them.
Lesson & Resolution 5 – Trust Carefully
Be *very* careful who you trust. Getting this wrong has been my single biggest source of disappointment this year.
If you’ve read the above carefully you’ll know there’s not much more I need say on this one right now, and you’ll understand why.
So for next year I will: Be VERY careful who I trust.
If you’ve found any of the above lessons or resolutions in any way helpful, and would like to share them with others, then please do so by whatever form of social media you prefer.
And if you’d like to help others, by sharing your own lessons and resolutions, then please leave a comment below and (following a quick moderator check) it will be published.