How I Convinced the Bank to Give Me “One More Week”

let me know if I get my timelines off, but I've got here between '22, '23, '24. I've got here overdue £8 million. Yeah, I don't know if that was right. So like, just what, what was the, what was the finance infrastructure like during that time? Like, yeah, yeah, I mean, how big was the finance team? And that overdue £8 million is in like your business was owed £8 million?

Yeah, so let me tell you about that. So if I'm honest, this was like I was great at winning the business, getting people to work with us. Like I say, finding people's problems, solving it. Brilliant. And in the early days that worked fine because I think I mentioned to you, we used a back office company that did all our invoicing clients and would do our credit control for us. And that worked really well until about 100, like about 100 contractors. And then we were looking at what we were spending with that company and it was like, actually, at some point, do we bring this in-house? Do we look at bringing this in-house?

And, um, to claim back more of the margin, basically, because there's a point where then actually is the—

yeah, yeah, is it, was it, was it, was it right for us? And we wanted more control. Like, if there was things not getting paid, I wanted answers there and then. I wanted, I wanted as a, as a business owner as well to have someone alongside me so I could learn more about the finance side of the business. And, and so it wasn't just straight away, straight up, sort of just looking at getting sent a report really understanding that or having someone I could spend more time with as well. So we made the decision at about 100 contractors to step away. And it's difficult for me because I've, like, I'm interviewing finance people now for the first time. So I'm like, what am I looking for? But I'm not an accountant, right? So I think those hires, very critical. And I'm looking and I'm seeing people that have got experience as a finance manager in another sector, like an it sector. and then that was my first hire, and he come on board, lovely guy. And I think the challenge I had was like, they weren't screaming to me like, we're not getting paid, or, or the, um, they were telling me everything was going all right, but it weren't till I've got NatWest calling me up going—

So was you, was you, did you feel it was like handled because you hired someone in that seat, you didn't proper put your head into it?

Because yeah, yeah, well, yeah, I hired a finance manager, or I've hired a qualified accountant to look after that piece of the business thinking they'll be able to just pick this up. They'll get the difference between it, finance recruitment and healthcare recruitment. And it turns out we went on a probably 2 or 3 years where we started having cash challenges. In the early days it weren't so bad, we'd make it work. Sometimes NatWest would call me up and be like, Mike, like you need to get hold of this. Like we're not gonna borrow you any more money. Like that invoice discounting facility we had, and I'd get on the phones and I'd call clients and we'd make it work and it weren't, it was bad. But then I switched the finance manager. I brought in another finance manager thinking I can't keep living like this. This is like on paper I'm getting sent something to say I'm making XYZ. It looks really healthy, but I've got the bank every week saying this is—

And that's because you've been paid because the bank provides you that money. But then they do that because then they're going to get their margin when the actual end client gets paid. But that wasn't—

Yeah, they're like, yeah, we don't mind giving you that facility if the NHS is going to pay us something at least like 'Well, our payment terms are 30 days,' but they're like, 'All right, we'll give you a bit of leeway, but you need to be getting paid on like 60 days from them.' What was like, I don't know if you did look at what ended up being like the average payment time to get cleared? There was times when we just have like so much sitting in like the plus 90-day column and like millions, I'm talking millions. So like, this is how bad, this is how bad. And hats off to Nutworst because they could have easily pulled the plug. So we got, I can't remember the exact date, it must have been about must have been about 3 years ago, it was at its worst. And I think at the time we had a £5 million invoicing discount facility with, um, NatWest. And we'd— they'd referred us to this special team inside NatWest. Basically, it's like when, when they're getting jittery and they're like, you— they're worried that, that they're never going to get this money, they pulled a special team in. And, um, I was getting calls. I think it was Rob, like, lovely guy, but in the end he's calling me 3 times a day. What are you doing about it? Like, what's your finance doing about it? Giving us targets. We're gonna basically come in and take control of the business. And I think they've just all written into their contracts that they're able to do that because they want their money, right? And every week I'm like, don't worry, we'll sort it out. Just give me one more week. Give me one more week. Like, we'll get enough cash in that keeps them happy and it'll sort it out. And I think we went, we had a £5 million facility and I think we got, we went £6 million, so we're £1 million overdrawn. We went £7 million and like the conversations were getting, I was getting bored of like the sound of my own voice promising them that we're gonna get cash in, we're gonna get cash in. And it was just, I think we'd had a payroll team, there was so much mistakes in some of the stuff we were invoicing. It was so messy that we like, NHS just were not giving us, like they weren't paying us because there was problems with every bloody timesheet or, brakes weren't put on properly, and it was just— we had like £8 million of this money that we owed, but we just couldn't get any of it over the line and paid to us. And it was, it was a nightmare. I think at its worst, I think it was £8 million in— I remember there was a Friday where— and I remember like, I think the Thursday night, I know everyone's getting paid the next day, and I'm sat in the boardroom literally thinking like, NatWest are going no more, no more. Like, literally, we're not paying your cats, we're we're not paying your contractors and we're not paying your staff. Like, you've just— you've got today to basically go and get like XYZ in, or like it's just not going to work. And I, I was sat in a boardroom and I've got my whole— I've got like 40 heads about— about 40 heads at the time. Everyone's looking at me like, why is my wages not in at 9 o'clock? I'm like just thinking, how do I get my worst nightmare? Yeah, how do I, how do I get out of this boardroom? Like, I've got every head just looking at me. They can tell something's up because I'm normally like absolutely fine and I'm still trying to mask it, but I think It got to the point where even it was getting to me. And I remember going out and we had an office manager at the time, Christie, was like, Mike, what's going on with the money? Like, oh, we've got millions of contractors calling in, where's our pay as well? And in our industry as well, if you don't pay them like one week, you have 200 contractors switch to another agency that will pay them. Yeah, ruin your reputation. And overnight you've just lost everything you've spent working like 8 years to build. And I remember like having to go out And it— they've done this in the weeks running up, but they'd keep bailing me out at like half 5 at the end of a Friday. I think they were like, not worse. And, uh, but this time he like— they told me it definitely weren't happening. And I just was like, head in my hands, what's gonna happen? And, um, yeah, I had to like beg Rob, like one of the guys. And he— at the time they were trying to— I think they were working because they knew if they just completely dropped me then I think they were worried that how the hell would they even be able to get that money in? So it kind of weren't in their interest to completely cut ties with me because they were worried about— they had, they had their £8 million on the line, right? So I think they were organising in the background to get their own FD person in to come in and basically take control of the business. And I think they were looking at like a CEO to come into the business just to try and get their, get their money back. And I, I went and found an, uh, an FD that had been in healthcare. And I was like, I'd rather get my guy in than them send their guy in. And we were working together and in the end they paid me out. Like, again, it was like, I think it was 6 o'clock at night or something, which was a nightmare. I had a heart, like basically had a heart attack that day. And, but the next week it was a bit of a turning point. I brought in a guy, really experienced guy, FD, and he was a sweet talker. He's Irish guy, kept the bank really sweet, managed to like save the relationship with the bank. And worked with my finance team to literally like, I think that next week we got like £2.5 million. There was like one client we was waiting on this like £2.5 million payment from.

Wow.

And it dropped the next week and we was like, oh my God, weight off shoulders. We are still in business. And I honestly think we were like weeks away from going bankrupt if that had gone another way.