Profile: Adam Mehmet, Relationship Director
Adam Mehmet joined Barclays in 2003, starting in the retail bank and working up to branch manager. He has spent 10 years with Barclays Corporate Banking, the last seven as a Relationship Director, dealing with clients from the restaurant, travel, cinema and professional sports sectors.
How do you view the hospitality sector at the moment?
The sector is incredibly busy. The theme that we’re seeing in lending applications is that more and more businesses are coming to us for what we call “roll-out funding”, which is them wanting to grow the number of sites they operate from and borrow money because their cash flow generation is at various stages. When you start to roll out, you start to use your cash fairly quickly, so you have the operational cash you need to sustain the business, pay wages and suppliers and so on, but you need additional cash to open new sites, and that can be capital intensive.
There are a lot of alternative lending providers. Do you have to pitch hard to get business?
It’s very competitive. You usually need a catalyst for a client to change banks, especially when they have scale. Where you can differentiate is when it’s a sector you understand and can point to other clients for reference and show how you’ve worked with private equity investment as well. Then you’re in a good position to win some of that business. But it is incredibly competitive. In my role you’re trying to win new business, but also defend the businesses you already represent when they’re going through refinancing.
So how much of your job is dealing with existing clients, and how much is winning new business?
As a bank we don’t separate the role of winning new business and managing existing client accounts, so it all sits on my desk. Time spent between winning new business and dealing with existing clients will vary. At the moment we’re finding that our sector and existing clients are so active that there’s a lot going on. Winning new business is great, but you can’t let the ball drop with your existing clients. As a larger business relationship director I look after 20 to 25 clients, and you are asked to win at least two new businesses a year.
How do you go about winning that new business?
New business could can arrive in a number of different ways: you could be invited to pitch by a debt advisory firm who are acting for a client looking to raise funds, or you go to networking and industry events and meet clients or investors there, or occasionally you get cold-called because the market knows we’ve been in the hospitality and leisure sector for a long time as a bank. There are 11 of us in London with a similar role to me, and many outside London with the same sector focus, and our Managing Director has done this for a very long time – speaking at events, putting out research papers and so on – so we’re one of the first ports of call.
You refinanced for Thai restaurant chain Giggling Squid, then won their card acquiring business. Is that how it usually works – once you’ve got a company’s business you get more of their business?
It varies. Typically, once you lend money to a client you hope to become their primary bank. A lot of these businesses are not large enough to justify having more than one bank. So if you lend, then the rest of the business will follow. Card acquiring is a product we are always looking to cross-sell, particularly as Barclays is the only bank that continues to own our own merchant acquirer and card issuer. If we’re talking to a client about all their touch points with banks then the acquiring side is a good synergy. Also if Barclaycard have a relationship with a client that we aren’t banker for, they will often introduce us to see if we can add value. If a client has a banking relationship elsewhere that’s not a problem, but we like to think we can add value somewhere.