Well, things have all gone horribly wrong. Where to start?
The simple answer is that before we could finalise the deal, the other interested party came back with a better offer. So. Fairly simple and business is business. Except it wasn’t that simple.
My partner and I stepped in with our offer because the current owner was in a difficult position. I don’t want to go into a great amount of detail, suffice to say, any monies paid for the business would be going directly to the coffers of the HMRC and he was obliged to get the best deal he could. What we offered was the valuation provided by the liquidation specialist. Our offer was formally accepted by both him and the liquidation specialist. We had both decided at that point that we would not engage in a bidding war as that would involve paying more than the assets of the business were worth.
So we got on with matters. I was manically busy not only trying to prepare the ground, but I had work to tie up with other clients. Consequently, my partner took most of the burden when it came to sorting out paperwork and insurance as well as keeping the day to day running going. Not to mention prepping the bikes I bought.
We anticipated that the little consortium that made the counter bid would leave and, one by one, they did so. Our strategy was simple enough – inject capital into the business while shrinking it to fit current resources while we recruited in preparation for expansion next season.
We were so busy that we didn’t pick up on the clues. We had our money all ready to hand over and pressured the current owner regarding finalising the deal. He prevaricated, citing the tenancy agreement with the council not being finalised for the transfer. I thought this odd as it would have been a straightforward matter, but I was so busy that I didn’t think enough about it. Not least, given that prevarication and weakness when it came to decision making were in character, so we didn’t anticipate any deception.
In the meantime, I had been subjected to a series of personal attacks from the rival group and these were taking their toll – the drip feed of personal snipes becomes tiring after a while and none of them were founded in reality. They were the real life equivalent of the online troll. Looking back, we had been subjected to a campaign of bullying the like of which I have not experienced for a long time. Not since the school playground anyway. The atmosphere became increasingly toxic and we just wanted all the bad apples out of the business – including the current owners, so that we could rebuild.
This week, they dropped the bombshell. They had accepted a better offer from the previous bidder. As I said, ours had not been finalised, so they can do this and as it would all be HMRC’s money anyway, there is nothing we can do. Sure, I’d spent money on replacement bikes for the two that had expired, but I can recover that money easily enough. I had a buyer who will give me what I paid for them within hours. No, the problem here is the betrayal of trust, the deceit and all this on top of what I have recently suffered this past year. These people were people I have worked with this past six years. Socialised with. Thought were my friends. Some of them even attended the funeral. That is what hurts. Discovering that they were scheming behind my back while I was doing them a massive favour by keeping the business going. That’s what hurts here.
On top of all that, I had cleared my diary in order to focus all my time and attention on this business. Okay, I’ll recover some work in June and I’ve got bits of pension coming in, so I’ll not be destitute, but the fact remains, that knowing what I was doing, this man allowed me to empty my diary of work and hadn’t the common decency to even offer an apology for his behaviour.
Despite my sometimes robust and misanthropic approach on here, in reality I am prone to be trusting in nature. I take people as I find them. I have made a massive error of judgement with these people and it has undermined my ability to trust in future. After all, if people I consider to be friends can betray my trust and loyalty in this fashion, who can I trust?
On the plus side, I’ve just spent some of the money on a new F800GT SE. Why not? The old one has just hit 19,000 miles and is four years old. If I want to maximise its resale value, now it the time to part with it. I’ll have a nice new training bike when I get back from the TT. My other two Motorcycle training clients want to make more use of me – it’s just that we will have a lull in June. July promises to be busy again and I will return to my original plan of being a carefree freelancer.
The problem Longrider with having a trusting nature is that sooner or later you stop having a trusting nature. Having been shafted both financially and personally, I now no longer trust anybody outside of a very small circle of friends, that is <5
I now no longer trust what anybody says anymore, unless I can verify it separately. It's a sad state of affairs admittedly, and I wish it didn't have to be this way, but there it is.
Agree completely. I Don’t trust anyone these days, other than about four very close, very old friends.
Experience has taught me people in general are shits.
Ugh. That sucks… 🙁
A friend will stab you in the front – but be assured they WILL stab you.
Well, what I have deduced is that these people were not, after all, friends. My partner and I have decided to walk away. We will remain friends. There may be opportunities for us to pick up in the future for we seemed to be a good partnership. He told me that he wanted a partner who would challenge his thinking and during our brief alliance, he certainly challenged mine on occasion. One of the good guys.
Brilliant. Love it!
If they’ve borrowed or mortgaged then when interest rates do go up (post Carney), that’s it for the weaker ones!
Basis for a short novel perhaps?
Don’t think I haven’t thought of that one 😉
Isn’t this what business is all about? Even gazumping?
I can’t blame the guy who took a better offer. From what little I can gather yours was straight liquidation valuation, so no payoff for seller. Any offer better than that and the guy gets something for the goodwill, that’s what most business try to build up.
Seems LR that you made a bunch of assumptions about the other lot, that they’d quit and gone away.
Let’s just twist this one around, look at it from their standpoint. I’d suggest they were probably quite peeved when you and partner outbid them. Sure they were being predatory – that’s common as dog poo, but not one single thing wrong in that.
You guys come along and show there’s more value/potential than they thought. And maybe, just maybe you or your partner just ticked them off. So if it got personal, sort of face saving stuff, so what?
Time will tell if they paid too much, or if the convenience grouping can hold together. In my experience the group may last a year or maybe two, but at some point life’s little kick in the nuts will happen and one will want to cash out. Depends then on the financial strength of the others.
The owner may well have been a total butt-wipe, but I can’t blame him for keeping his powder dry. To him, he’s got four to make up their minds, maybe they will, maybe they won’t. They did and he accepted.
I know you’ve been shafted and I can understand the comedown you must feel, but that’s business and it ain’t nothing personal. Business is business.
You’ve pulled out, no bidding war going on. No money lost, just vast amounts of time and energy. You’ve experienced a learning curve – and that’ll be filed away for future reference.
At this stage in your life, surely you understand the basics of adult relationships. If you can’t use it, manipulate it, make money out of it or fuck it, then it’s just another stiff to help pass the time.
You might be being generous with your year or two. Once the other instructors not in the “in” group have been ousted, the poison they have generated will spread to internecine infighting. Also, they will want a return on their money. They’ve paid over the odds and no one gets rich running a bike school at the best of times. Our partnership was based upon not making much of a return – if any – for a number of years due to the school being run down and having to shrink to fit fewer instructors while we recruited. I doubt that the new owners will be so patient.
Okay, a couple of you have made comments but are reaching conclusions based on insufficient information. As you will understand, I’ve not given a complete picture and I do not wish to give full details even now.
However, a brief synopsis of events: In April, we were advised that the business was insolvent and a liquidator had been appointed. The liquidator had valued the business on the basis of its assets. Any money paid was owed to the HMRC – nothing in excess of that amount would go to the business owner. Everything raised would go to the HMRC as the bill was well in excess of anything that might be raised, so beyond a duty to the HMRC to get the best price, there was no motivation to get a price beyond the business’ assets.
A consortium of five instructors put together a bid that was too low for him to accept, so he rejected it. Now you would expect at this point, they would come back with a better offer. Nope. The leader of the group threw his toys out of the pram and walked, leaving the owner in the lurch with test bookings to honour. Guess who dropped everything and came in on his day off to fill the gap and take the clients to test? Guess who worked his nuts off to fill the subsequent gaps in the diary to keep things going? Oh, yes, that would be muggins.
I was approached by another instructor who had not been involved to make a joint bid so that the business would not go into liquidation. By this time, we had recognised the bad faith that existed among the group that had placed the original bid and our whole business plan was built around the likelihood of them leaving, which, one by one, they did.
We acted out of loyalty to the current owner in order to keep the business going in one form or another (it was a limited liability company, so that would have to liquidate and another rise from the ashes). We offered the full value given by the liquidator. We did so only because the other group had apparently walked away from the deal. Had they not done so, we would not have made our bid.
So for a month after our offer was accepted, we continued alongside him planning the process for the change in ownership, promoting the business, buying bikes and running the diary, completely unaware that he was now talking with the other party behind our backs – with a man who had indulged in gross misconduct in walking out, leaving clients in the lurch with a matter of hours’ notice.
I don’t care overmuch about losing out on a business deal as I have other things I can do and other schools that want my services, and, to be fair, I was initially reluctant to engage for that very reason, but I allowed myself to be talked into it and subsequently threw myself into the project. I do despise the practice of gazumping as it is inherently unethical, even if it is a case of being part of business. I don’t do it and I despise those who do. What I care about is that my loyalty and trust were betrayed by someone I considered a friend and for whom I had gone the extra mile when he was in a difficult position. That matters, whether in a business relationship or a personal one.
@LR
I sympathise, betrayals have happened to me costing me >£50,000. Unlike an MP, my money lost – no HMRC/Taxpayer reimbursement via expenses.
Since mid 40s – after so many betrayals – I now trust nobody inc family. Not being able to trust one’s mother & brother due to their lies and betrayals is debilitating.
Stay strong, you have support here.
God Bless
P
Fortunately, I’ve got off lightly. The money I spent on bikes is recoverable. I’d got a buyer within a couple of hours. I’ve lost work in June, but I’ll recover. If nothing else, I’ll spend the time starting my next novel.
Sympathies to all. I too now trust nobody, including family. Not being able to trust family due to multiple betrayals feels not only debilitating but leaves one open to half-justified accusations of paranoia.
However, I’d rather be thought paranoid than taken for a fool again.
Bill
+1
Did family betray you “for your own good”? Somehow, unrelated of course, they were enriched/empowered.
Sympathies with your situation but I wouldn’t let it change you that much at your age. Learn from your mistakes. Just take a bit more care in the future.
My personal way is that when I am shafted I drop them immediately and I’m not a very forgiving person. I won’t forget.
Don’t know your situation but couldn’t you and your buddy set up a rival organisation and make their situation that little bit worse than it is now.
That possibility has not escaped us. Maybe at some point. In the short term, we are regrouping.