George Flo is not easily surprised, but even he was taken aback when a 22-year-old walked through the door of The Heritage Club clutching a watch worth half a million dollars and needing quick cash because he had burnt through his monthly allowance.
“We never ask the question why you need the cash. It’s not our business,” says the British-Cypriot entrepreneur who set up the Dubai-based luxury-watch buyback service 10 months ago.
The Heritage Club offers high-net-worth clients the ability to release immediate cash against their watches – anything from Dh25,000 to Dh2.5 million – with a contractual guarantee to buy them back within 30 or 60 days.
The business is currently custodian of just over Dh20 million in client assets. Mr Flo is not paying himself a salary – instead reinvesting everything back into the company, which he started following a two-year retirement in Cyprus after he sold his recruitment firm to South African bank Investec.
How did money feature in your childhood?
My parents are the hardest-working people I’ve met, but the worst commercially in terms of business.
My dad had a fish and chip shop, and I remember at 13 or 14 saying to him, “Why are you pricing cod and chips at £3.50?” And he said, “Well, that’s what everyone’s charging.” I said, “Yeah, but what’s it costing you?” And he said, “I don’t know.” I was like, “Well, how do you work out your profit if you don’t know how much it’s costing you?”
Even at 20, I was like, “Dad, how much do you owe on the house?” He’d bought it for £100,000 about 10 years before, and he said, “I don’t know, son.” So I phoned up the bank – pretending to be him – and he owed £101,000. He was on an interest-only mortgage for 10 years.
But you know what? Providing you’ve got love, reassurance and backing, I don’t think you need anything else.
What was your first job?
I got refused the paper round. Then I was cleaning dishes in my uncle’s restaurant in Broadstairs (England) – a summer job. He was paying me £1.50 an hour and would only allow me to drink squash.
Then I went into telesales, pitching leads for a company that sold windows, doors and conservatories. My background has always been sales.
After university, I stumbled into recruitment. It made sense to me as a job: connecting what someone wants and what someone is good at, and brokering the deal to put them together.
I was an employee for seven years, then I resigned at 27 and set up my own business. That was the one we ultimately sold.
Did you have any early financial challenges?
My parents weren’t in a strong position financially. Going to university at 18 and leaving with £50,000 worth of debt was tough. I started on a law degree and changed to an international business degree after about a month, and after three years with such a generic degree, I struggled to find work.
There have always been hardships. Under pressure, you’ve got some people that focus, and some people that fold. There have been some taxing times where I thought I’d probably bitten off more than I could chew.
The risk element was a lot easier when I was younger and didn’t have dependents. Now it’s more informed risk. I always go with my gut.
How do you manage your money? What do you earn?
I’m quite reckless with money. I’m very frivolous – like the gift that keeps on giving. I like to reward myself with milestones of achievement.
My short-term goal when setting up The Heritage Club was to get to Dh5 million as quickly as possible. We did that within the first month. Now it’s Dh50 million. The next one is a second location.
I don’t see the value in saving. If I put money into a Coutts treasury account, I’m getting five per cent a year and the money’s dead; I can’t touch it. Whereas there’s no tax on loans, no tax on borrowings. From a commercial perspective, you’re better off leveraging, refinancing.
I first started earning good money in recruitment at 21 – I didn’t see less than £8,000 net a month. When I left recruitment, I was paying myself £1.5 million a year.
At the moment I’m not paying myself a salary. Anything that’s made in the business is being reinvested. Turnover for show, profit for dough.
How do you grow your wealth?
As you get older, you need diversification in your investments – long-term, short-term. Smart people don’t sell; they leverage, they borrow, because there is no tax on borrowing.
I’ve been smart enough to have bought commercial property and residential property back in the UK. When I sold my business, the first thing I did was pay off all my commercial loans – that was smart.
But now the smart thing to do is not to have unencumbered buildings sitting there earning me nothing, but to pull equity out of those and repurchase additional properties that generate more income.
I’ve invested in some start-ups. Of the five, three have been terrible investments. One looks very, very good – a gift loyalty card company targeting a younger demographic. It’s valued at between £75 million and £100 million, and I’ve got a 10 per cent stake.
I also invest in watches. I like to invest in things I can predominantly touch and feel. I don’t play crypto, I don’t play the stock market, I think those can be very easily manipulated. I like to control what I own.
What is your best financial investment?
One of my biggest achievements: I was 13, cleaning dishes in a restaurant building – which I now own, not just the shop, but the whole building. For me, that was a major milestone. It was at the corner directly opposite the beach. It had provenance. To say I bought the whole freehold of somewhere where I cleaned dishes at 13 is quite a proud moment.
What financial advice would you give your younger self?
You need to surround yourself with people that elevate you, people that you can learn from – whether financially, spiritually or just in good company.
Hate doesn’t come from above; it comes from beneath. If people are better than you at something or more successful, they’re more inclined to give you good, honest advice, and that elevates you mentally in every which way.