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Hear the word "entrepreneur" in Canada, and you might immediately think of Leonard Lee. He's the founder and owner of the woodworker's friend, Lee Valley Tools - the centre of a cluster of cutting-edge companies, including a medical tools manufacturer, called Canica, which he has been trying to develop over the past decade. Now 70, the former Ottawa public servant is trying to pull back to a more sedate existence - no small challenge for a guy who designed and built this edifice with his own hands.
What will be your next business?
This is the last business. I'm going to quietly go back to just designing tools. It's because I'm reaching the age of Methuselah. My birthdays now start with the number 7.
Are you typical of entrepreneurs who can't stop?
I wake up very early in the morning - geezers all wake up very early in the morning - and I go to work because I'm excited, not because I have to. That's been the case for the last three decades. It's hard to stop what you like best.
And it isn't about money. It's about: Can you make this product marketable, so that it will appeal to the customer? Doing product development is exciting work.
But won't you continue it?
I will, but it will be on things like a new way to sharpen kitchen knives, or something like that.
Is this a good country for entrepreneurs?
It's excellent. Where are you going to get a country as un-class-conscious as Canada, where the greatest piece of luck you ever had was being born here?
There is a better R&D tax climate here than anywhere else in the world. And you can get intelligent staff. Our competitors in the U.S. woodworking tool business have far higher rates of returned products. It is usually because their employees are not as numerate or literate as ours.
They get more stuff back because it was sent out in error - in the wrong number, or it's the wrong thing, but it doesn't happen with us. In general, the Canadian education system is good. We all whine and complain about it at times, but it's good.
But aren't we poor innovators?
We are not risk-takers in general. My parents told me to get a good education and a secure government job. That is a pretty Canadian approach.
About half our total mail order business is done outside of Canada, with the major part in the U.S. American customers will analyze something and say, 'Well, that looks interesting, I think I'll buy one and try it out.'
The Canadian approach is: 'I'll find someone who owns that and see if they like it.' Canadians are always sort of later adopters and so they are also later innovators.
It's just that we go through a highly unionized education system and there is a lot of emphasis on security. In our view, people don't foul up, they're victims. Well, actually, people do foul up, and they should recognize it. There is a little different psychology between the two countries but, as far as being in business, I'll take Canada over anything.
So we have a built-in cultural obstacle?
Which brings advantages and disadvantages. So deal with the matrix you're given.
For your parents, why was it good to have their son become a bureaucrat?
My parents went through the Depresssion on a marginal farm in northern Saskatchewan. I grew up in a log house on a farm where, when my dad left it, it became community pasture. It was proven you couldn't make a living off it. So there was good reason for them to be security-conscious.
You were well into a public service career, but then decided 'enough of this?'
Thirty years ago. I was 39, a man at the worst point in his life. Unexploded bombs.
My wife and I started selling a cast-iron barrel stove kit where you bolt parts on a 45-gallon drum, cut a hole in the front, and put a door on. That's what heated the school I went to as a kid. I wanted one for the shed on my farm and I tried marketing this. We broke even in this small business the first winter, and I resigned the next summer from the government and went into it full-time.
What bothers you about the way business is conducted now?
What I find most amazing is watching Canadian and American businesses farm out their customer service. You might as well put a gun to your head and pull the trigger. It's Russian roulette if you farm it out.
Why?
Because the [outsource specialists] don't know your business and they don't know the culture. When you've farmed out customer service, you've lost the connection with the customer, and you will eventually die a horrible economic death.
So you will never outsource customer service?
Never. You will never find, I hope, a screened telephone call when you phone Lee Valley. Anybody who has called me in the past 30 years was put through without asking what they were calling about or what their name was.
When you have a customer who gets directly though to a senior officer in a firm, it's like a dog that's caught a car. The customer doesn't know what to do now that he or she has hope.
They'll say, 'But I didn't expect to get through to the president.'
'Well, you got through. What can I do for you?'
'Well, it wasn't really that big of a problem.'
'It must be a problem. What can we do?'
So you've won the battle just by not putting up screens and blockages between you and your customers.
But you're only a $100-million company and these are billion-dollar enterprises that feel they have to outsource.
Yeah, and they have a lot farther to fall. It will happen. This is where the competition comes in - they will just provide the service. There are so many choices today, people ought to be able to rely on their suppliers. But if you can never get in touch with them, you can't rely on them.
What do you personally do well?
I think I hire well, and I only hire people I trust and who are honest. You can get fired for two things in these companies - one is lying and you get a second chance; second is theft and you don't get a second chance. You cannot afford to have a thief around the company at any time.
I tend to hire people who have my background, which is blue-collar. My wife says I am terrible in discriminating against people from a silver-spoon background. Well, I don't understand them as well as I understand people from a blue-collar background.
And I want people with belief systems so they know the difference between right and wrong automatically. They don't have to say, 'Well, I have to think about that.' They should be able to respond immediately.
What's your biggest weakness?
I talk too much. I'm overly optimistic. My wife will say, 'Now, you fell in love with that. You'll probably fall out of love eventually on this.' But I think things usually turn out the way you expect. That's why pessimists should not go into risky ventures.
What's wrong with talking too much?
Sometimes I don't listen well. I make a lot of snap decisions. That's why you don't want so-called yes-men around - someone who is behind you when you are on the edge of a precipice. You want them in front of you saying 'Are you out of your cotton-picking mind?' You have to have people who tell the truth.
*****
Leonard Lee
Title: Owner and chairman,
Lee Valley Tools, Ottawa.
Born: Wadena, Sask., in 1938
Education: Diploma in civil engineering, Royal Roads Military College; Bachelor's degree in economics, Queen's University.
Career highlights:
1963: Began 17-year career with federal government, including foreign service stints in Chicago and Lima, Peru, and Industry, Trade and Commerce experience.
1978: Founded Lee Valley, a mail-order business for gardening and woodworking tools.
1985: Founded Veritas, Lee Valley's manufacturing arm.
1991: Founded Algrove Publishing.
1998: Formed Canica Design to develop medical instruments.
