I got peace of mind by taking my first steps on the property ladder
▶ Eight years ago, entrepreneur Jean-Michel Gauthier co-purchased a London apartment, which has since risen in value by 65 per cent. He tells David Dunn about his financial philosophy
Jean-Michel Gauthier is co-founder and chief executive of Oliv, formerly Interns ME, a Dubai digital career platform connecting youth, students and new graduates to employers for internships, part-time and graduate jobs. The British-Belgian entrepreneur, who launched his first start-up while at university, has been a London pharmacy branch manager and structured a shareholder exit for the family’s Dubai wholesale and retail business. Now aged 31, he lives in Downtown Dubai.
Q How did your upbringing shape your attitude to money?
A My father’s a construction management professional. He would bring me into the office in Dubai, aged 11½. One thing he instilled in me is being able to create stuff that outlasts you; a legacy. Mum is the entrepreneur; Armenian by heritage she grew up in Iraq and then immigrated to the UK. Her first business was in real estate. She owned and operated businesses in Dubai as well, which we sold when they retired in 2012. I took inspiration from both sides. I was an only child, raised in a way that I’m self-motivated. I never received regular pocket money. If I wanted something, usually instruments as I played bass in bands, they’d buy it. When I was 18 I got a Warwick bass guitar worth Dh5,000; it was my pride and joy. At 14 or 15, my father brought me in on his Excel sheet; ‘this is our household balance, how much I earn, how much mum earns, what we spend’. I felt part of a household team and started to get an understanding of forecasting.
When did you first manage your own funds?
I went to the UK to do a master’s in pharmacy. My parents supported me the first two years with an allowance, a fixed monthly budget. It was tight, no surplus. There was a lot of pasta cooking, walking and bus riding. It was not a massive hardship, but coming from being raised in Dubai … My parents were retiring soon and there was that drive towards self-sustainability, as soon as possible, so I could say ‘don’t worry about that allowance any more’. That was my first experience in budget control.
Did you ever worry you might not pay the rent?
Definitely. And when you’re starting a business, before you’re cash-flow positive, you’ve got to take out the leanest salary possible to make ends meet. You’re the first person you cut back on. You’ve got staff depending on you. There have been times in this business, and previously, I’ve taken my salary late.
How much did you get paid in your first job?
At about 24, I worked six months in an NHS hospital, then six months in a management hub. After tax I received Dh6,300 and saved 30 per cent. My first entrepreneurial endeavour, aged three to six, was drawing. My parents let me know when we were having guests round. I’d do a series of drawings and slap on random price tags. By the time they arrived I’d set up shop in the hallway.
Are you a spender or a saver? Definitely not a spender. There’s not a lot I buy for myself. When I think of purchasing decisions, it almost always defaults to what we need in the business, rather than what I need. What surplus I have I save … most of my savings go back to the UK.
What do you save into?
A savings account, until I work out what I want to do with that cash. I have made a few small personal investments in start-ups. I’ve experimented with the stock market and locally-based Beehive. There’s a UK robo-investing platform, Moneyfarm, that I use.
What is your best investment? The time that I put into Oliv. It is the largest personal investment I make, building this company and giving equity I have in the company value. With my family, and prior savings accrued in my 20s, I co-purchased an apartment in London. In eight years it’s gone up 65 per cent in value.
Before you’re cash-flow positive, you’ve got to take out the leanest salary possible to make ends meet
What is your most cherished purchase?
Of the last couple of years, the only thing I’ve purchased for myself, of real value, is a Les Paul [guitar]. They retail for
Dh9,700. The sound is just gorgeous. Sometimes you’re getting home at 9, 10 or 11pm. That’s the thing I go to, crank up the amp, apologise in advance to neighbours. Luckily they’re not there often. I usually use a headset.
Are you wise with money?
I’m pretty frugal. I don’t make impulse purchases above Dh1,000. I’ll read reviews, speak to people, take time, come back to it, see if my mind has changed ... do I really need it? Hopefully it’s something that retains its value. My ethos is to buy something good that I never need to buy again. The only exception, that doesn’t cost a lot: books and comics. At some point I’m going to want to read them so might as well buy now.
What has been your key financial milestone?
Getting on the property ladder, as a peace of mind thing. Being cash-flow positive in the business was a major one; for sure, you’re going to get paid.
Do you try to instil financial wisdom into clients?
Eighty per cent of our customers are SMEs, managing costs; they want to, if possible, grow without taking a lot of upfront risk. Hiring younger people can circumnavigate some upfront risks and costs. We strongly advise all businesses to pay their interns; you’ve got someone committing time, studying and working hard, is going to contribute real value to your business, and may be out of pocket if you don’t offer at least a basic stipend. Probably 90 to 95 per cent of the internships are paid. The average monthly stipend is Dh2,000-Dh4,000 per month.
Do you have a philosophy towards money?
On a personal level, beyond a certain point of having the basics covered – you’ve got the rent, can get to where you want to be, eat what you want and can take a trip – the surplus doesn’t really have a massive impact on my level of happiness. In business the profit/revenue you generate should be an outcome of the value you create. It is the creation of that value that should drive you and be your passion. I want to help get as many young people into internships as possible. If you’re in business you can’t be oblivious to money, of course. It could potentially be toxic if it’s your first, outright objective and you’re not conscious of building real value; build the value, stuff really useful to people, and money will come.
Do you pay by cash or credit card?
Debit card. I just don’t carry cash. I use a credit card if I’m getting air miles, but clear that at the end of the month.
What would you raid your savings for?
Family. If your family is not taken care of, forget all these other things we talk about. Luckily my family members are also very wise with money.
What would you do if you won Dh1m?
I dream of a trip to Japan, one of those once in a lifetime trips I don’t want to wait until retirement to take … where I’m not going to do my usual budgeting.