19th August 2017
I met a broker last week, who has performed for us on several large deals previously. He always manages to pull something out of the bag when it’s required.
Appearances are very deceptive; he mostly comes to meet me and clients in jeans and a t-shirt, in short his appearance makes me look good. He’s a Punjabi lad from Birmingham, but don’t let appearances fool you. The size of deals and quantity of deals he does with lenders is more than the whole of Savills do together. He earns seven figures year on year.
In short, he punches well above his weight. The community his business comes from is almost exclusively the Jewish community, which he has dealt with for over a decade. They operate in a very old school way, are commercially minded, their word is their bond.
He had dealt with one Indian previously, besides myself, and he said this will be probably the last time he deals with them. Being an Indian he can get away with saying this.
I mentioned to him that our clients are almost exclusively Indians. I can sympathise with his sentiments. Many of the Indians I have dealt with have a tendency not to want to pay fees. They do not value advice or the value of having a partner. They value objects more.
So, they will happily negotiate and even re-negotiate fees, and profit shares. Not knowing a fruitful relationship can yield a lifetime of good and easy business deals. They concentrate on the deal and do not tend to honour the relationship. Not all are like that, but unfortunately a large majority. Contrary to belief, this doesn’t make you a good business man, it means you lack in integrity and it just makes you predictable, and short sighted.
One of the issues is that Indian money is relatively new money. They have just come into it, meaning it is either first or second generation money, and there’s a difference between new money and old money.
One Jewish lender I met, and do business with, his family has been lending money since at least the time of his grandfather; he has his roots from Iran. I visualised that it was probably his ancestors whom Jesus threw out of the temple! The money they lend is money which is offshore earning a paltry rate of interest.
They focus on investments, which even in a downturn will not go down. When they invest into property they are mindful of areas which have capital growth but their focus is on yield, so whatever the weather they are earning money every month, if the underlying asset goes down. The other investments they look at is freehold investments. Here the ground has to be paid regardless, if someone refuses to pay, or there is a delay, the mortgage lender will pay on their behalf and add it to the mortgage bill. These two activities along with money lending means their money will not be diminished, even during a downturn. This is the mindset which will ensure wealth lasts for generations, and their history speaks for itself. In summary, long term business is all about maintaining relationships. Deals may come and go, but a strong relationship will yield a continual harvest.
Suresh Vagjiani
