Mistakes I Made #6 – Signing A 5 Year Lease on Day 1. #Idiot.

One benefit of getting older is that you gain experience, numerous transferrable skills and most importantly, wisdom. And with that wisdom you, hopefully, learn from your mistakes.

Like most 18-year old’s, when I was of the age, I was ambitious, easily excitable and hungry for money. I was pretty much willing to do anything to make a buck or get rich quick.

I was a quick thinker and made important decisions on the fly, but why not, I knew everything at that age, right?

So, I decided to start my own business. And to do that I was under the impression (for some unknown reason) that I needed a shop front or retail space where people could walk in off the street and purchase my services.

With that said, one thing you must know about me is that I HATE commitment, I always have, I like my freedom even in business.

I absolutely dislike signing my name on anything that ties me down for more than 6 months.

I also utterly despise signing long arse contracts with all this legal mumbo jumbo telling me how badly I am going to be screwed if I put a foot wrong. You know what I’m talking about.

But most of all I HATE making mistakes. I punish myself for weeks on end for being stupid and not knowing better. Little did I know what awaited me at that time…

Now having said all that, you can only imagine the tailspin I wound up in and the anxiety I caused myself when I got duped into signing a 5-year lease.

What a mistake. But like I said, I knew everything at that time- what could go wrong?

Let me tell you the leasing agent saw me coming and took full advantage of filling his quota.
I’m not saying he’s a bad person, what I’m saying is that I was young and inexperienced, and the agent knew it and used it to his advantage. You do the math.

We looked at the space, and because of the ‘creative’ wording the agent spun me and the ‘discount’ I received for a long-term lease, I thought I was getting a good deal.

But what happened was that 6 months after starting my business, the business model changed, and guess what, we ran out of money (facepalm) and the space I leased – for 5 YEARS (eye roll) now did not serve my purpose anymore.

We urgently needed to move somewhere smaller and way cheaper. But I still had 4.5 years left on that damn lease.

Now in most cases; if you break a lease it not only looks bad, but there is great financial consequence involved.

You need to either pay out the remainder of the lease period (who has the money for that) or if you are lucky enough for the leasing company to allow it, find some other sucker to take over the lease.

So, listen, you don’t know what the future holds, you never will. You may need to downsize within a year, or upgrade in 6 months, you just don’t know.
Thus, don’t be afraid to pay a little more for office space instead of a retail space.
Most business is done online these days and retail space is just not necessary anymore.

Look for office space that comes without a contract like a co- collaboration space or coworking space, or something that offers a month-to month option.

And also remember; there is always wiggle room in ANY agreement.

Rome wasn’t built in a day and you can bet your bottom dollar there were lots of fights, disagreements and rearrangements of the how, when where, and what.

Thus, don’t be afraid to negotiate terms that work for both you and the Leasing company or Landlord, very few things these days are set in stone, except maybe the ten commandments…

Now having said that, also do your due diligence.

Research; ask advice from people with experience, Lawyers, Bookkeepers, Real estate agents etc. can give you valuable opinions on how to negotiate better terms for your lease agreement.

Don’t leave anything up to chance, because believe you me, chance has a nasty way of biting you in the butt when you least expect it.