Everything here is quiet. It's nice. I am still settled and content with life.
I have a friend from early high school that recently asked me for money. He has asked me before so it does not really bother me- but I think the first time he ever asked me to "invest" in his business plan- it was handled wrong and I think our friendship was forever altered. Maybe not forever...but it's been about 3 years and I am still on guard when I think about him.
The first time he asked he called me up and kind of jumped into this "I have such a good idea...it's going to make so much money...my father wants to be involved with me- this is our plan and it's so simple I know it will be a success." speech. He caught me off guard b/c we rarely talk on the phone- I had not heard from him in a few months (not uncommon), and I was like, "ok. Good for you! Starting your own business! Whatever floats your boat!"
He continues to tell me that he and his father have it all worked out, and his father already has so much experience owning businesses that it is a cant miss opportunity.
Then he jumped into the hard sell, "all I need is 15k to get it started. Why don't you be an investor and we will just send you checks every month?" That totally blew my mind and I was stunned really.
I had huge warning bells going off in my mind and wanted to get as far away from the subject as I could. The idea he presented to me...did not appeal to me. I could not see much of a profit margin, and this idea sounded a little too close to a mainstream technique that is already in use...and not really rolling in popularity. He might make a profit- but not enough for me, himself, and his dad to share and realize this as worth the risk or time. Beyond that- his father does have experience owning several small business like a cleaning comp, a laundromat and I guess he was very very successful...but lost EVERYTHING over 10 yrs ago due to tax evasion. Since then the parents have really struggled to live and my friend has been trying to support them from his own full time job.
So I politely told him that I don't feel comfortable investing in a business, and I don't have any liquid cash anyways because I was saving for a house. He didn't argue, just ended the conversation and that was it.
After that I did not hear from him for a YEAR. I was feeling "off" about the whole thing and sent him a friendly email later that week and got no response. I periodically contacted him on myspace or facebook and left him funny or friendly messages and got nothing. He was totally ignoring me. Months later I was headed back to my hometown for a vacation (did I mention he and this business he wanted me to be a part of is over 1200 miles away from me?) and wanted to hang out. Nothing. No response at all. I had always planning to invite him to my wedding but because he was not talking to me I didn't.
Recently-about 7-8 months ago he just sent me an email. It was just a "I don't remember why we were fighting but it's all in the past and I hope things are going well for you." email. I accepted his "apology" and just tried to be normal again.
So catching up with him, I found out: his father had been diagnosed with cancer and had been in treatment for almost a year. Now he is in remission but the whole family is pretty shaken up. The family has a lot of bills and my friend has been 100% focused on his family and keeping things together financially and emotionally for them.
I just felt a bit deceived. Clearly he learned the news about his father and wanted to put into action a plan that they had shared together as a last tribute to his father. Rather than turning to me for support, or to talk- he saw me as a bank and turned to me for money. He was ready to have me invest in a plan without telling me the 3rd partner was not going to be able to participate at all- and he as the primary business man might be too distracted himself to even be able to run the business efficiently.
So I felt I had dodged a really intense bullet. I wish him the best but the whole thing reminded me why you do not loan or invest in a friendship. The whole incident is always on my mind when we talk, but I know he was acting impulsively and emotionally and probably doesn't really only think of me as a contact who might be able to give him easy money.
So last night he IM'd me. He started off with how he earns almost 100k a year to do a job that is so easy and he really wants to challenge himself. Aside from his govt job, He is currently running the businesses his father had re-started after the whole tax incident and earns "about 25k" a year from those businesses. And although he makes 125k a year he is bored and has a "really great idea that he wants to start and his goal is to make a million dollars in 6 years off an initial 50k investment." I saw where this was going instantly and just couldn't believe it was going to start again. I steered the question away from him flat out asking me for the money but he mentioned several times about needing an investor.
I am just annoyed because he kept throwing that he earns so much money (far far more than I currently earn from my job) but has no available cash to pursue his "dream" of starting this business because he gives all his spare money to his parents. It's noble to support your parents, but with his current method of having no organization- only giving them money is kind of throwing good money after bad. I look at this guy who earns very very good money and lives in an apartment, has no outward trappings of wealth and apparently has zero savings. He is living paycheck to paycheck- not because of his lifestyle, but to support his parents lifestyle. And they are not really getting back on their feet either- everyone is limping along. There seems to be no organized budget at all in the family and stretching money does not seem to be anyone's strength. Clearly earning the money is not anyone's problem- I do believe the family has a good work ethic- but a person can never earn enough money if there is no organizing where it goes. I look at small character traits like that and realize that being in business with this family (from 1200 miles away) would drive. me. crazy.
So that was last night. I am curious to see if I ever hear from him again.
money and friends
July 11th, 2009 at 02:39 pm
July 11th, 2009 at 02:54 pm 1247320464
July 11th, 2009 at 04:03 pm 1247324611
Also, does he... know of your real life financial situation?
Anyways, I knew two people in real life that are into the business of real estate. Or was. Both of them were talking about all the opportunities that are out there, and how basically, there's fistful of money to be made if I wanted to get into it. Both are highly intelligent and educated by the way (one has a MBA), but when I asked for their business plan, they not only didn't sound so great to me, both had elements of MLM!
Huh? These are smart people, why are they even involving themselves in this? Suffice to say, I've heard nothing about it since, seeing how the real estate market has tanked.
Seriously, if he wants to do business, he needs to prove to you how this will work, and as heart-felt as it is to want to give his father a sort of farewell tribute, that is NOT a business plan. Do something nice for people's family if you want, but risking them seeing that their "parting legacy" is yet another failing business is not a good idea in my book. Heck, the two shouldn't even mix!
July 11th, 2009 at 04:24 pm 1247325851
He does know my real life financial situation. I leaned on him a lot during that phase of my life and he was exposed to knowing I have a lot of money in savings.
And now he is going through a rough time and needs my help as he tried to help me- but giving him money is not how I want to help him. If I did that then it would really be throwing good money after bad money being thrown after more bad money.
Unfortunately I think he believes that this business plan is going to fix everything that is wrong in his family and doesnt see it any other way. I think he is really hurting and I want to be there to support him- but don't know how to show him that I care when he thinks that me "investing" is how I should show him that I care.
I dont want to be involved in this business whatsoever. I see disaster written all over it due to his emotional reasons for starting it, his financial management skills, our friendship, and just the idea (restaurant type of idea)...requires a lot of time that I don't think he has.
July 11th, 2009 at 05:14 pm 1247328872
July 11th, 2009 at 06:35 pm 1247333726
July 11th, 2009 at 09:58 pm 1247345887
July 11th, 2009 at 11:41 pm 1247352084
It would probably be different if everything was handled differently. If you had faith in him financially, if he was straight with you from the beginning, and if he had been organised in everything to do with the business, then it may have been a viable idea. It all depends on the situation and the people involved. For instance, the above couple I mentioned, would be interested in going into business with me in a cafe-bookshop-art-gallery type of business - while they have no startup money or anything like that, I can already say I would feel 'safe' going into business with them - it all just depends on the character of the person, and this reflects on how they handle every aspect of it too.
July 11th, 2009 at 11:55 pm 1247352914
July 12th, 2009 at 02:56 am 1247363817
He's "bored" while earning 125K/yr? Tough. And while earning 125K/yr he wants to sponge 50K off of you "for a sure fire deal?" Get some of your own skin in the game, chump.
Run, do not walk from this guy. Oh wait, you are 1200 mi from this guy. Phew!
July 12th, 2009 at 06:23 am 1247376192
July 12th, 2009 at 11:09 pm 1247436593
July 14th, 2009 at 05:26 pm 1247588765
July 18th, 2009 at 02:07 pm 1247922463
July 18th, 2009 at 02:44 pm 1247924681
He doesn't sound very sensible and too gullible to keep believing in get rich quick schemes.
July 19th, 2009 at 06:40 pm 1248025203
Now there may be a reason for that - stress over his father's illness etc.. which means he is not in a good place mentally... which means he should NOT be starting a business....
Also the figures just don't add up... how can he not save 50k himself when he is earning 125k a year ? Surely he could hold back on propping up his parents for a while if the business idea was THAT good ????
One word. Dodgy.