Lessons Learnt From A Business Partnership That Cost Me £50k

Table of Contents

Reading Time: 7 minutes

Hey guys,

So at this time of writing, I owe Stripe 6k, have 4k in taxes to pay and am a former business partner for Pearl Lemon Leads who have 5k per/month in billings from clients he has taken.

Assuming he keeps them for 3 months, that’s 15k + 10k in taxes.

Furthermore, I’ve spent 12k over the course of the 8 months the business has been running on SEO, content, and other resources the business has required across the Pearl Lemon Leads website and later Kas Andz.

That’s 37k so far.

Then Pearl Lemon (my main SEO business) has certainly not grown at the rate it should have and over 8 months I project we are around 20k worse off than we should be.

That would bring this all up to 57k.

Let’s assume I’m exaggerating (because people always do) and bring that down to 50k.

This is to exclude my own personal time doing stuff in all of this which I’ve just written off.

Kas was a young 20-year-old guy that I decided to partner with as he was a graduate of my ‘Secrets of a Six Figure Lead Gen Consultant Course’

Deepak Shukla Website

I’d met him at a business networking event I hosted in Fulham and I recall him sitting down at the front with his camera and taking photos of the entire event.

This was a segue into Kas asking for business advice, and we even had a coaching call that was on YouTube, where he was asking about the best approach to entering the manufacturing space.

I’m struggling to find the call that we had – he could have now removed it.

As Kas took my course and I was struggling to maintain the business from a lead generation as well as SEO front, I’d allowed my focus on the lead generation to fade.

With Kas being a successful graduate of the course and me struggling to understand how to scale both businesses – I decided a partnership could work and into business together we launched.

Kas was 20, inexperienced in the world of business (relatively), and new to the world of lead generation – but had bags of energy and determination to make things work. So I thought that would override issues related to business.

As I’d discovered, that was terribly wrong.

Pearl Lemon Leads was a company I’d started with the primary intention of being a lead generation service that Kas would run.

And to his credit, he worked his socks off to make things work and clients began to roll in as a consequence of the brand I’d built and leads that were coming in via SEO.

As I’d discovered, retention didn’t seem to be there at all

We kept winning clients and sometimes as soon as a month into the business we’d lose them again.

Things reached a critical point in June when we had a particular client who was paying us £6.5k a month for SEO and Lead Generation combined, and we were struggling with the lead generation side of their campaign.

The company Real Homes (fictional name) were hiring us to help them ultimately sell more property investment deals.

It was a tough sell for a B2B company like Pearl Lemon Leads to work on anyway as this was effectively a B2C campaign – but we felt like perhaps this was something that we could make work.

The approach we were taking was a combination of LinkedIn Lead Generation as well as Cold Calling.

Pearl Lemon Leads Website

Fundamentally we were running a combination of automation and manual messaging on their personal LinkedIn accounts as well as building lists of particular types of businesses that we thought could have the money to work with them to then cold call.

We struggled with the LinkedIn messaging until we extended the funnel and made it more value-led instead of transactionally-led as we were original. So once we started producing content around investing advice in general – this started to gain a lot more traction.

Alongside this, we also would cold call initially using two callers we liked in the Philippines that we worked with that were doing the cold calling for us.

Things came to a head when I asked Kas to send me some sample phone calls, so I could hear what the Filipino guys were up to. I’d assumed that there would be some simple tweaks to the campaign to make.

To my horror I discovered that the guys were being rude on the phone, going off script and not qualifying the actual lead at all. It was a mess.

And this was 4 months into a campaign which meant the client had spent £16k.

That was a huge red flag for me that Kas admitted he had overlooked.

We decided to ditch the callers and focus on making LinkedIn and Cold Email work.

[convertful id=”197358″]

As the months passed and retention still was an issue – I’d talk to clients as well as some staff on the Lead Generation side of the company and find that communication seemed to be a problem.

I had a lack of clarity on many of the things that were going on. Kas would assure me it was all on track and it’d only be upon having discussions with an unhappy or somewhat happy client that they were unclear on many things.

So the narrative that I was being fed by Kas seemed rather different to what I heard from clients. There would be some weeks when a client didn’t hear from Kas at all, and this really surprised me as Kas said he was always busy.

August 2019 was our best month in terms of sales. We bought in around £25k of new business. And then yet somehow by October all of our money was gone.

I checked the company bank account and there was <£1,000 in the bank account.

I’d spent much of this time focusing on building up my property portfolio and focusing on this aspect of my overall growth.

So when I discovered we had no money in the company bank account given we had two salaried employees (Kas + 1 other person) I was shocked.

One of the agreements I made with Kaz was that I wouldn’t take any income from the business for the first year. So I struggled to understand where all the money had gone.

But disappeared it had.

Outside our inability to keep any of our clients happy what also hadn’t happened were the following things:

  1. We hadn’t had a single client we were running cold email campaigns for
  2. We were creating fake LinkedIn accounts and running them for our clients (these were continually getting banned and then Kas was remaking new ones)
  3. Kas had spent most of his time trying to fool Linkedin, so he could keep this game up
  4. We didn’t continue with building any type of cold calling team as had been the original idea alongside email
  5. The £25k in our account had disappeared (and Kas always had an explanation for such things, but they didn’t seem to make sense in my mind)
  6. Clients were not only unhappy, but they were also pissed off with their experience of working with us
  7. LinkedIn ultimately banned all Pearl Lemon accounts and the entire Pearl Lemon Leads team was banned from being on LinkedIn

LinkedIn Page Not Found

8. I had my own account banned and had to escalate it with LinkedIn to get my account restored

Now in Kas’s defence, I had been aware of us making fake LinkedIn accounts for the first few months. So I admit culpability there also. However, the plan had always been to reduce this activity to zero ultimately and increase cold email + cold calling as this was a sustainable way to do business.

This, of course, hadn’t happened.

The agreement between us had always been that if we couldn’t make the business work, retain clients and generally make a success of things then we would shut down the operations.

I did this with immediate effect in December very abruptly and said to Kas:

“Let’s shut down all the LinkedIn Lead Gen stuff, you can keep running those campaigns if you wish but not under the Pearl Lemon Leads banner but that way at least you’re not out-of-pocket.

Furthermore given you’ve got your own website which my team built you can use that for your base of operations and continue operating as you wish by yourself.

If we have any debts let’s keep running client campaigns and then wrap things up.’

Kas was very quick with issuing refunds, switching clients to his own personal account and moving away all the logins to his personal email accounts. Furthermore, he took all the case studies that belonged to Pearl Lemon Leads and rebranded them as Kas Ands.

This was all fine with me had the transition been clean.

Due to my trust in Kas given our historical relationship and that he’d stayed in my home whilst flat hunting and moving from his family home to the city and the time I’d spent with him – I assumed he would make sure there weren’t any bills left to be paid.

This was not the case.

So on balance, my business partnership with Kas has had a net negative impact on my life.

What I’d like to walk you through here are some lessons learned:

  • Before you jump into an equity partnership with someone – spend 6-months working with them outside of this
  • If you instinctually have worried – immediately act. I first had worries in June 2019 – had I acted then I would have saved myself a lot of grief 5 months later
  • Run an audit of what’s actually going on 1x a month where you sit and look at absolutely everything and figure out what’s really going on
  • KEEP making partnerships – just because 1/2/3/4/5 partnerships go wrong doesn’t make partnerships themselves wrong you just need to change the way you do them

As to my relationship with Kas – it continues. I don’t have it in me to hold grudges – they cost me more energy than they’re worth.

We’ll even keep doing business together – but the way we’ll do business will change. It’d be separate bank accounts, under a revenue share model with much clearer lines of division.

Kas continues to help me with other elements of the journey that I’m on and my suspicion as to this whole process is that he’s actually just a young guy who was trying to make things work and he didn’t know what he didn’t know.

And as soon as things became tense he sought an exit that would protect himself without giving full thought to where it would leave me with the bills left to pay.

I’ll probably come back to this piece and adjust it in time – but if you have any questions or comments let me know.