Page 131 - James Caan - The Real Deal

12 · Growing the Business

employees on the payroll, calculate commissions and log every-
thing in the books we passed to the accountant. He told us what
he needed to see to file our accounts and make our VAT returns,
and we just did what we were told. It was all done by hand as we
didn’t have computers then.
If I hadn’t already used an accountant who was cheap and
reliable, I would have done the admin myself. I think an
entrepreneur should be able to do that stuff, and I would strongly
advocate that first-time entrepreneurs take on those tasks. It’s
really not that complicated, especially as the internet gives you so
much access to information these days, whether it’s a template
business plan or a sample VAT form. It might be different in
businesses where you have a high volume of transactions, but in
an agency situation where you have a modest number of invoices
to take care of, doing your own books gives you the opportunity
really to get to know your business, to spot patterns and to spot
mistakes.
Perhaps the biggest lesson – or maybe the biggest surprise – in
the early days was that there really wasn’t anyone I could turn to
for a definitive answer about anything. I had assumed that lawyers,
accountants and bank managers were there to help. I was wrong;
they’re there to make money.
For instance, when I was considering increasing our rate of
expansion – after all, the more people I hired, the more money we
made – I went to the bank for a loan to cover the cash flow (even
the best recruiters take a couple of months to place their first
candidate, and then it takes another couple of months to get the
invoices paid; in the meantime I would be paying their basic
salary). Given Alexander Mann’s flying start, I hadn’t anticipated
a problem.
‘The problem with Alexander Mann’, the bank manager told
me, ‘is that it is a service industry.’
‘I know, it means I don’t have the expense of production,

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