It was September 2008 and I was using a recruitment company to try and set up a training company which I had decided would be a good thing to do. During the discussions it appeared that the two directors of the recruitment company would rather like to sell out and gradually over time it would enable them to retire. This sounded as if it could be a win win situation and we went away and had several meetings when we agreed the Ball Park figure that I might be willing to pay for their business.
It was fashionable at the time to refer to management recruits as being talent. So within the industry you’d be searching for talent. The company was based in Shenstone and had a sign outside saying they were looking for management talent. A lady walked in one day, when I was there, claiming she was talent and gave them an impromptu singing demonstration. They said they would let her know.
We met in a bank in Birmingham that allocated a free meeting room to anyone who wanted to use it. By this point in the negotiations pretty much everything was agreed.
I said, “OK gentlemen what will your salaries be into the new organisation?”
They looked at me blankly and said, “Well, of course, what we’re earning now.”
I pointed out that they were taking all of the profits in the company as salary and if they continue to do that there would be zero point in me buying the company, since there would be no profit whatsoever left. The negotiations came to grinding halt and we all went off to live another day.