The life of an entrepreneur is full of lessons, I literally never stop learning. Today I learned some great lessons which I think are well worth sharing.

A year ago, one of our top sales people did an advertising deal with a company, a first time client. Demographica is an advertising business and this particular deal was not out of the ordinary. The deal was for a large sum of money and we were pretty excited about it. The campaign was executed and the results were fantastic – the client was actually so happy with the results that they wanted to extend the campaign and book a few more.

When the sales person came to chat to me about putting together another campaign for the client – I asked her to please ask the client to settle their bill and once settled, we will gladly run more campaigns for them.

A year later, we were still chasing them to pay the invoice.

About 3 months ago, I asked our financial manager to get in touch with the clients CEO and try work out some payment terms with him. Their CEO was completely ‘unavailable’ and eventually the CEO’s assistant came to chat to our financial manager. They agreed to settle the invoice in 3 equal monthly instalments with the first instalment due at the end of April 2013. After the meeting, the CEO’s assistant sent us an email confirming the terms of the deal.

This morning, Demographica’s financial manager and I were going through our management accounts and I noticed on the debtors control account that this client still owed us the full amount and had not paid the first instalment.

I was angry. I was upset. I was disappointed.

I suggested to our financial manager that he and I should go down to the clients office right away and see the CEO to talk about the money owing. We got in my car and took a drive.

We arrived at the clients swanky offices in a really upmarket part of Jozi and requested to see the CEO. We were told to wait in the boardroom and that they would check if he was available.

In the boardroom, there were pictures hanging on every wall. Each picture had the CEO posing with a different government minister right up to the president of South Africa. Already I had some insight into the character I was dealing with. He also had numerous business certificates and awards lining the walls.

After 30 minutes the CEO had still not joined us in the boardroom. I walked out the boardroom and recognised the CEO from the pictures, standing in the hall, and confronted him. I shook his hand, introduced myself and asked him about the money that he owed us.

A physical altercation then occurred.

I’ve removed the details of the altercation out of this post because they are simply not necessary. This post is about the lessons learned, not what actually went down at his offices.

We both left his office immediately after that.

After doing some research on the CEO after the incident, it turns out that although he is a very successful businessman, he has a colourful history of law suits and controversy. His companies were at the centre of huge public interest scandals and he himself has appeared in numerous respected business magazines exposing him for his behaviour.

He is a thug.

This is what I’ve learned after today’s ordeal.

1. If a company owes you money, there are processes and procedures that can be followed. There is no need for vigilantism.
2. Get a deposit from first time clients and do the necessary background checks. It’s important to know who you are in business with.
3. Consult colleagues, partners and/or friends before you take any drastic actions. a contrarian view can change the game.
4. If you confront someone, be diplomatic – you never know what type of person you are dealing with.
5. At the end of the day, it’s only money – you don’t need to put your safety and the safety of your staff at risk.