Charles Sirois, bank chairman? It doesn't sound like the right fit for the onetime whiz kid of Canada's telecom entrepreneurs, who has started 20 companies and won and lost billions striving to convert his visionary ideas into real businesses. Yet it is an older, wiser Mr. Sirois who, at 54, recently became chairman of the Canadian Imperial Bank of Commerce. These days, he gets as big a kick out of mentoring nascent African capitalists through his Enablis Entrepreneurial Network as kick-starting ventures of his own.
How would you describe Enablis, a non-profit venture born out of the G8 summit seven years ago? It's a system to develop entrepreneurs in emerging countries. We supply capital to entrepreneurs - but it is much more than that. Developing entrepreneurs is a bit like making a cake. You need many ingredients, and they need to come in the right proportion at the right time. Money or capital is just one of the ingredients.
Does this interest in helping entrepreneurs come from your experiences as a young man in Chicoutimi? I had the chance to be in a marvellous country, Canada, whereas many of these people didn't ask to be in these countries. They practise something that is almost extreme entrepreneurship - like extreme sports. We try to give them a set of values, a set of knowledge and a set of tools so that by themselvesthey can face adversity and grow.
Are you successful? We have more than 700 entrepreneurs in our system after five years, and they are building jobs every day. Each time they create a job, it makes a living for 10 other people around them. We are now at more than 3,000-3,500 jobs and you can calculate that 35,000 people are taken out of poverty. Our hope is to have 3,000 entrepreneurs in sub-Saharan Africa. They will not all be successful, just like not all Canadian entrepreneurs are. But failure for an entrepreneur is a way of learning. If you fail, you learn, you get better and you try again.
As far as failure, you told a South African newspaper that you have personally lost $2-billion in net worth. If you calculate the value at market price of the assets I was holding, yes, that was probably true. But market price is one thing and what you are creating is another thing. Sometimes you have a disconnect. It was during the technology bubble when a lot of enterprises had tremendous market capitalization. But when you get back to reality, these assets have been adjusted.
Is that the life experience you bring to Enablis? My view is you need to be born an entrepreneur. It is an attitude where you are ready to live with a certain amount of risk. You start with a dream which is converted into a vision and into a reality.
I have started more than 20 companies from scratch, which were all once just a piece of paper. One day you say, 'Boy, that would be a good idea.' After that, you start to put meat on the idea, you start to identify the resources you will need, you build a business plan, you convince investors, you bring the right management. I've done that many, many times.
How are you coping with the meltdown? Very well. You learn from the past. I saw the meltdown in technology in 2000-2002, and obviously we had a lot of debt to deal with because we were building infrastructure. But now we are in very good shape because we have no debt at all.
This meltdown is very different because it is addressing the financial infrastructure common to all economic activity, whereas the tech meltdown was just one segment of our economy.
The good thing is we will probably redesign the capitalist system - it was in need of something like that. I don't know what it will look like, but obviously the type of economy in five or six years will be quite different than from five years in the past.
Do you have any idea what it will look like? We will need to be into a more non-speculative kind of capitalism and into a real-economy type of capitalism. I have heard some leaders say we have to take back the system from the speculators and put it back into the value-creators, the entrepreneurs and all that.
Speculation is very important but it should be a shock absorber of the real economy, not the engine. The problem is we have relied on speculation as the engine for too many years. The true engine is essentially innovation and transforming innovation into real goods and services. This is how you create real money and capital, not by exchanging subordinated or structured notes.
In the real economy, we have to invest in technology infrastructure and this is how you create capital. You do not do it by taking some mortgage, and making some esoteric structure. And we cannot live in a world where greed is the main engine. For many years we have applied the same principles in capital markets as in goods and services markets. But the main motivation of a goods and services market is need. If you need a glass, you want to make sure you have a lot of choice between different producers; you want free information about the difference between the various glasses. But if you are investing in a structured note, your main motivation is not need. It's greed. Maybe that's too strong, but it is capital appreciation. It's quite interesting to see how the world is evolving and a great time to be in the middle of all that.
How does it feel to be both an entrepreneur and a bank chairman? Some people ask why I want to be a bank chair in these days. Because it is quite interesting. There is no better time.
But it does seem like a paradox. At the same time, I understand risk very well. I understand that the bank is an institution that is very different than an enterprise. And I am somebody with a propensity to make things happen. That's part of me.
Some people have said that, after taking your lumps in the tech era, that 'Charles Sirois is back.' I don't know why they say that. It is true our company is family-owned today, which is quite different than being a publicly traded company. In a private company, you don't need to speak to the press - you don't have these obligations. In a public company it is part of your job to explain to the stakeholders, and to the press and public, about what is happening. But that doesn't mean we are doing nothing.
What is your biggest lesson from the past 10 years? To put risk into the equation. When you are a young entrepreneur, you don't see risk. Maybe this is why you become an entrepreneur. But if taking risk is part of your life, you need to understand it. And if you understand the level of risk, you can still build the enterprise. I also believe you need to have people around you who are smarter than you in many fields. Enterprise is not a money business - it is a people business.
You seem to embody the word entrepreneur in Canada - with all the scars and triumphs.
It is part of myself - and you can be an entrepreneur in many fields, in non-profits or in government. You cannot avoid it. You cannot say, 'Oh, that's a good idea, but I can keep it over there.' If it is a great idea and you believe in it, you have to say 'How can I transform that into reality?' On another topic, is Michael Sabia a good choice as head of the Caisse de dépôt et placement du Québec? He definitely has a very strong intellect and a high degree of ethics. We need to give a chance to the guy.
This country is a small place, isn't it? Canada is just a big kitchen and we are all in that kitchen. Sometimes it is crowded, and we all eat around the same table.
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Charles Sirois
Titles: Chairman of Canadian Imperial Bank of Commerce.
Chairman and CEO of Enablis Entrepreneurial Network.
Founder and controlling shareholder of Telesystem Ltd., Montreal.
Born: Chicoutimi, Que., in May, 1954
Education:
Bachelor's degree in finance from University of Sherbrooke. Master's degree in finance from Laval University.
Career highlights:
1978: Launched business career by taking over family-owned paging company.
1978-1987: Became leading player in Canadian paging industry.
1987: Merged his companies with Bell Cellular to form BCE Mobile Communications, with him as CEO.
1992-2000: Chairman and CEO of Teleglobe, provider of international long distance and broadband services.
1994: Funded Telesystem International Wireless Corp., as building block of his telecom interests.
1995: Founded Microcell Telecommunications, a cellular service known for Fido brand.
2000: Sold Teleglobe to BCE. (In April, 2002, BCE cut off funding for its Teleglobe investment.)
Developed Enablis as partnership between private interests and the Canadian government.