Tempz.com, which opened in Jersey with much fanfare in the spring of 2000, and provides on-line temping recruitment services to the UK market, is moving back to the mainland, having found that it needs real offices in addition to its web-site.
The virtual jobs agency agency was opened by Chris Leonard, an experienced recruitment professional who had spent 5 years developing his concept of the 'virtual' recruitment agency utilising call centre and Internet technologies, and Ian Thomas, tempz.com's Chief Operating Officer, who had established a finance software development company in the Channel Islands, which he eventually sold to a major UK-listed group before entering the recruitment industry.
Tempz.com paid Goring-based innovative software producer Bond International Software £250.000 to provide the back office solution to its web-site: Bond's Adapt software enables tempz.com to provide a one-stop e-business service, meaning that everything - from registration and completion/authorisation of timesheets, to updating details and invoicing - happens online.
Tempz.com, is funded by investment partner ci4.net.com, The Econet 4 Europe, and was launched on April 13, just four months after Bond's team of specialist developers started working on the pro]ect.
In a classic example of offshore e-commerce, the company hoped to be able to run its business 100% from Jersey, meaning that it didn't need to charge VAT to its UK customers, and that its profits would be free of tax. The company now says that it needs to add bricks to its clicks, and once it started opening offices on the ground in the UK it could no longer get any benefit from being in Jersey.
There may be more to this story than meets the eye. It is easy to guess that tempz's backers have pulled the plug at a time when dotcoms are no longer fashionable, and are not prepared to see out the long wait till profitability - opening physical offices should help to reduce the cash burn (after initially increasing it). However, to retreat so totally and expensively from offshore shows either a degree of panic, or perhaps more likely, lack of understanding of the possibilities of offshore on the part of the vc's. Jersey was an odd choice in the first place, since there are more tax-effective locations for a pure 'clicks' operation, and there is no need at all to give up an offshore location for the whole of a company's operations just because one needs to have onshore sales points - look at the bookmakers for proof of this. But there's no fighting a panicking vc!
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