To My Credit, from Easan Katir

January 14, 2011 |

Once upon a time a Chicago acquaintance called. He was raising money for his new company, which was going to manufacture aluminum shipping pallets, and replace all those grungy wooden ones upon which goods are shipped. I reviewed the pro forma, assessed the risk, pointed out that unit cost would be an insurmountable hurdle as with so many new inventions, and said no.

A month or so later he called again, saying he had raised all the money except for one last tranche, and would I please reconsider, that i was such a good friend, and he had always admired my singing voice. When I said no, his voice got thick, he said I was his only hope, that couldn't i just lend it to him for a short time. He was actually crying and pleading. I said i had no interest in being part of the venture, but since he put it that way, I would loan him the money secured by his house. Amid wailing, and protests that his wife would divorce him, he finally agreed. He signed the paperwork, and i wired the funds.

Years of drama-filled annual reports went by. He listed me as an investor in the company, which died a torturous, lingering death, after a second round of capitalization.

More years went by, and I had written it off and forgotten about it.

Lo and behold, one day a set of papers arrived for my signature. The fellow called, and sounding much like a weasel, explained he just needed a quick signature to 'clean up some past documents', which of course he needed asap. After a day, I recalled what the deal had been: I guessed he was now refinancing his house, as this happened back when hapless bankers and reckless householders were still dancing jigs together.

I said I would be happy to sign upon his repayment of the loan. Oh, the shrieking! The sound of his gnashing teeth! He tried to argue I was merely a shareholder, and had taken the risk, and as the stars had in retrospect been badly misaligned, and the venture was kaput, it was only fair i suffered the same fate as his other good friends. I reminded him of the real deal, and proposed that if he paid up withing three days, I would forgive the interest. His other needs must have been pressing, because he sent me a payoff check.

When my son was very young and i was teaching him new words, i taught him this one:

kol - at - er - al …. and had him repeat it over and over and explain the meaning.

Craig Mee adds:

A friend recently told me that a friend of his, quite well-off, borrowed a sizeable "mates" loan… and unfortunately x months later, and after asking for it, had not payed it back. He then mentioned he spoke to an old mentor. His words were "when you make the decision to give a friend money, never ask for it back, and if it reappears then you have had a win". Very interesting, and I find good advice.





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