The One Thing You Wish Your Clients Had Already Done

A favorite question of mine when I talk to other professionals is: “You’ve been doing this a long time, you see patterns. What do you most often say to your clients (or wish you could say) about how they could have helped themselves before coming to you?”

A patent lawyer told me last week that U.S. patents must be filed within one year of public use of the invention. Lots of inventors come to him with something that’s up and running, and now it’s too late to file. His advice: At least talk to a patent lawyer sooner rather than later. If filing would be premature, you won’t be too late.

A corporate lawyer doing business divorce told me last month that people often form limited liability companies and don’t bother with an operating agreement (it’s not required in a lot of states), making any breakup potentially messier. Operating agreements come in a thousand flavors, but you will save yourself a lot of heartache by getting some advice about the one that is best for you and your business partners.

A technology specialist I know was helping clean up an information mess after a company got hacked, and the client said they had forgotten to get cyber insurance. As far as I’m concerned, the loss of 15 years of client data is a bigger threat to my business than a flood that takes out my $2,000, triple-backed-up computer.

What about for my business, investigating people? What should clients have done already?

• Do at least a quick search on someone before you hire them.

In the past year I’ve seen a company go after an employee for embezzlement, only to find out that he had $500,000 in old tax liens when he was hired. I could have found that out in an hour pre-hire and saved them a lot of headaches.

• Consider looking at longtime employees. If someone wasn’t checked beforehand because they were too low-level to bother with, what happens when they spend 20 years in the company and climb the ladder to the point that they are entrusted with serious money? An embezzler at the New York Archdiocese a number of years ago fell into this category. She started small, worked her way up, and nobody ever thought to check on her. I’ve heard employers say after a big theft: “But he was here 25 years! We trusted him!”

Here are examples of two of my clients who did it the right way:

• A company from Europe spent $2,700 checking the CEO of the small American company they were planning to acquire for $5 million. I found out he was facing his fourth drunk driving charge. That was money well spent to avoid a potential nightmare. Another candidate company turned out not to own the intellectual property – this was owned by the president’s personal firm.
• An accountant is selling his practice and last week wanted a quick two hours done to make sure his buyer (with whom he would work for two years during the earnout) had no skeletons in his closet in the form of ugly criminal history or regulatory problems. The good news – he didn’t. $800 bought the seller a lot of peace of mind.

While what I do isn’t insurance, it can feel that way to the client. If you spend money to make sure you’re covered if someone rearends your car, you aren’t annoyed if nobody rearends your car. You’re happy you’re covered if things don’t go well. You may also sleep better knowing you did more than a Google search on your future best friend in business.

What is the one thing you wish your clients got right more often before coming to see you? Answering that question can give you a lot to think about in refining your business value proposition.

Asking it of others will almost always teach you something about the world of business.