These veteran entrepreneurs made the leap from small-business owners to big shots. Here they share their stories, challenges and turning points and offer advice for their growth-minded counterparts
Heather Reisman: Indigo Books & Music Inc.
Toronto | 1996 | Close to 7,000 employees | 244 stores | $1 billion revenue
The most important thing is to do something you feel insanely passionate about—so passionate that the challenges that will inevitably come up and the people who will tell you that you can’t or you shouldn’t, all of those things will be minimized by your passion and determination to make it happen. When your business is tiny, you are the owner of the vision, the person who has to make everything happen, and you sweep the floor and lock the door. You do it all. You are going to make mistakes. Every entrepreneur will tell you this—that they have made so many mistakes, but they’ve done more right things than mistakes. But it’s close. If you can get your business to a million, you can get it to a billion. It is hugely helpful to have someone close to you who believes in you totally. Entrepreneurs will inevitably have moments of doubt, so having someone whose advice you truly value, who can give you perspective, allow you to stand back and see things in context—that is invaluable. It’s hard to start a business with absolutely nothing. You will need a bit of seed money. Sometimes it’s as little as $5,000—I’m not saying it has to be $1 million. But you can’t fool yourself either. If you don’t have any resources, you will burn yourself out. When men make mistakes, they seem to think, “That’s a mistake,” and move on. Whereas women who make mistakes, especially early on, tend to say, “Oh no, my entire career is over.” Starting Indigo was the single most challenging thing I’ve ever done. I am at an equally challenging moment now. While sustaining the book business for all people who care about it, we also have to transform it to deal with the reality that 30% or 40% of books will be bought digitally. That means 30% of my business that needs to be replaced. That’s a big transformation. Starting and building businesses is what drives me every day. We started Kobo from scratch. Everybody said we were nuts. In 23 months, we went from a standing start to being identified by Wired in January, 2012, as the best e-reader in the world. My husband and I love the entrepreneurial spirit. This is the moment for entrepreneurs, and we need them. If we can get the entrepreneur thing really happening here, there will be no stopping this country.
Ellis Jacob: Galaxy Cinemas (now Cineplex Entertainment)
Toronto | 1999 | 130 theatres | 1,359 screens | 10,000 employees | $1 billion revenue
It was scary when I was let go from Cineplex. I had a wife and two young kids. I was taking a big risk. I took all of my assets and put them into Galaxy. It could have turned good, or it could have turned really bad. You’re never sure in those situations. When I asked Robert Lantos, who ran Alliance and was an investor in Galaxy, if he wanted to see the business plan, he said, “No, you’re the business plan.” That put a lot of pressure on me because I had to deliver. Work hard and be lucky—but you have to create your own luck, too. My claim to fame is, nobody’s ever quit on me, in my 30-odd years of working. The only person who ever left me—and he’s very close to me now—is my partner at Galaxy. I think it’s important to have great people who you can trust. My big focus is customer service. It’s tough because you’re dealing with a lot of young people. The positives are, they’re young and you can mould them. The negative is, they have a mind of their own. Always keep your ego in your pocket. Because people in our business, especially, their ego takes over. You have to treat everybody like you expect to be treated. I learned a lot from Garth Drabinksy, but he had a different way of operating. He was driven, but he also threw a lot of good money after bad things. Sometimes you have to say “I made a mistake,” and move on. We still try to keep our entrepreneurial focus, but it’s a little tougher when you’ve got 10,000 employees.
Frank Hasenfratz: Linamar Corp.
Guelph, Ontario | 1964 | 16,200 employees | 39 manufacturing facilities | $2.8 billion revenue
I was a stowaway. I came from Hungary by boat in 1957 and arrived in Quebec City. An immigration officer came on board and asked what I was doing here. I said I was a refugee and wanted to immigrate to Canada. He gave me $5 and said welcome to the country. It took 15 minutes. I was 22. I started washing cars for 25 cents a car. I even saved money. Eventually I came to Guelph and got a job at WC Wood, which did a lot of work for the Avro Arrow. I’m a toolmaker by trade. My boss and I disagreed on how to make a part. One day I walked into his boss’s office and said, “You have to fire this guy or I quit.” Guess what he said? “You quit.” When things are really bad, don’t go and hide. Just think, can you make a profit out of it? I set up some machines in my basement and garage, and we made Ford oil pumps—1,000 a day. Each time we started up a machine, the television went down. Two years later, we built a small plant next to the house. For seven years in a row, we put an addition on the building, but we paid for everything in cash. What you gotta do is, you measure everything. Everything. If I read a book, I measure how long it takes to read a page. If you don’t measure, it doesn’t get done. I’m a freak about that. Almost all of the people I’ve hired, they start at the bottom. You have to learn how things are done on the floor if you want to manage people. I only know one job where you start on top: when you dig a hole. And guess where you end up? In a hole. Since my daughter Linda took over in 2002, I haven’t been to a meeting. Cost-cutting is my job now. We call it CAB, for Cost Attack Team. We look at the floor, at shipping, at every penny and see what we can come up with. I never have a [situation] where I don’t find $200,000 in savings on an annualized basis. Never, ever, think you have it made. The day you think you have it made, you go the other way.
Ron Joyce: Tim Hortons
Hamilton | 1964 | 4,042 stores | $2.9 billion revenue
When I started out, they tried to teach me the doughnut business with a Ouija board. The first store had been open for about nine months. There were no formulas, no operating manual. I hired a gentleman who was highly qualified—a Harvard graduate—and he began to change the whole philosophy. That didn’t work, and after a year we decided that maybe he would move on, and I would continue the role I’d started with. Probably one of the greatest errors in judgment was to sell the company to Wendy’s. I made the decision for estate planning purposes that I would exit, and find a company that could take the chain on. We didn’t know until after the fact that they were a troubled company. Keep it simple, stupid. Don’t try to be all things to all people. The words “That’s good enough” don’t exist in business. You cannot rest on your laurels. The auto business suffered badly by making a product that was inferior. They learned their lesson. Quality first, as Ford would say. And I think that’s true in anything we do. At the grand old age of 81, I’m still active. You have this age-65 mentality that a lot of people still have today. They believe it’s time to quit, and I guess, really, that’s stupid.
Brian Scudamore - 1-800-GOT-JUNK
Vancouver | 1989 | 1,500 employees | About 180 locations in three countries | $95 million revenue
My father, who is a transplant surgeon, had to go to school. But entrepreneurs are different. You just have to problem-solve on the fly. A lot of it is difficult to teach. I think that’s why so many entrepreneurs are high school and university dropouts. My biggest mistake turned into a positive. In 1994, I had a team of 11, and I decided to fire them all. I sat them down and said, “I’ve let you down as a leader. I either haven’t hired the right people or trained you enough or given you enough attention.” I went from five trucks and a two-person call centre down to just me. What it taught me was that it’s all about finding the right people, treating them right. Finding the right people is 100 times more important when you’re finding a franchise partner. One of our loose parameters was, would we invite this person into our home for dinner? We wanted a cultural fit beyond just the passion and the belief in the vision. The experts all told me, “Don’t franchise this business. It won’t work. Anyone can go out and buy a pickup truck and haul junk.” They were right in the sense of, don’t go franchise this business as it currently exists. One of the big things we put in place was a call centre. I want our franchise partners out there driving sales. I don’t want them dealing with booking and dispatching. That was one of the secret sauces. The name change from Rubbish Boys was hard. I don’t want to say it was a mistake, but it was a painful transition. Our revenues declined substantially, but I had to have faith that 1-800-GOT-JUNK was the way to go. I had a heckuva time trying to get the phone number. It was owned by the Department of Transportation in Idaho. I had so much confidence that I was going to get it that I ended up hiring a designer to design the logo, the whole bit. I made phone call after phone call, and eventually I got someone in the department who said, “You know, you’re really bugging me. Clearly this phone number is more important to you than it is to us.” And we exchanged the number for free. He just wanted me to go away. That’s obviously one of the key things for the business—the crystal-clear belief that something is possible, that I can make it happen. Have a clear vision of what the future looks like. And not just in your head, but on a couple pieces of paper. It takes the picture from my mind as the entrepreneur and shares it with everyone in the business. Read The E-Myth by Michael Gerber. That was my manual on how to scale and grow a business. I grew up with ADD. I had trouble focusing and I was terrible with books—I’d get three pages in and then put it down. This one, I read cover to cover, put it down, took a five-minute break and read it again.
Michael Cowpland: Corel
Ottawa | 1985 | $180 million revenue in 2000
I met Terry Matthews at Microsystems, and we started Mitel. Most people thought we were taking a heck of a risk, because we both had good jobs as managers, and we were leaving for the unknown. But it turns out the whole place was shut down one year later, so we made a good move. Mitel’s first two products weren’t winners, but we reacted quickly and moved on to the next opportunity. Then we doubled every year for 10 years in a row. Microsoft played tricks on Corel, for sure. It got to the point where we’d get WordPerfect bundled on Hewlett-Packard computers, which would have been a very good deal, with tens of millions of copies going up. Then Bill Gates wrote a letter to the president of HP and said, “If you put WordPerfect on your machines, you won’t get Windows.” We sued them and eventually got $150 million [through a share purchase], so that was sort of a consolation prize. Corel ended up being one of the top 10 software companies worldwide even today, and that’s good to see, because if it just dissolved, that would be disappointing. Terry is invested in about 80 companies. He’s been extremely proactive in investing in other companies, which is great. I did a bit of venture cap, including owning sports clubs and restaurants, and I found out that most of the time it’s easier to lose money than to make money. So I decided to focus on what I’m good at, which is high-tech. We focus at Zim on enterprise databases, which is kind of boring. But on the other hand, enterprise clients are good customers because they don’t mind paying for things. Whereas if you look at the consumer field, virtually everything now is free. The most common mistake entrepreneurs make is the Excel spreadsheet forecast that goes up like a hockey stick and is not based on actual sales. We do some small investments at Zim in companies that are a strategic fit. We always look for ones that have real sales, because getting customers is not as easy as it looks. People who just have an idea on the back of a napkin—you used to be able to raise money like that in the Y2K bubble, but now investors are a little more skeptical. You have to get as close as possible to customers so you understand what they really want. Quite often a product has a lot of features, and maybe 20% of them are really necessary, and 80% are fluff. I like being back at a small company. At the bigger companies, you tend to have a lot of large meetings, which take too long and are kind of boring. I much prefer to be in a small, fast-moving organization.
Cora Mussely Tsouflidou: Chez Cora
Montreal | 1987 | Over 120 franchises | 4,000 employees, including franchises
After I divorced, I didn’t know what I was going to do. No one wanted to hire me because I didn’t have a particular skill—I wasn’t a hairdresser or a banker. I wanted to be a writer. But I knew how to cook, from my mother. I can remember my grandfather saying, “Don’t sell the skin of the bear before you kill it.” Meaning, don’t spend more money than you save. Even when I didn’t have money, I always paid my bills. When you start with nothing, you learn to save money, have discipline, to count and plan. Now, we don’t have any debt at all. Money is the thermometer of an enterprise. You don’t take any actions that don’t make you money. Wanting a business and being committed to it are two different things. For a miracle to happen, you have to be committed. Many people don’t think business is work. Work is the biggest ingredient in the recipe. Another big thing was focus. I decided to make breakfast—that’s all that we do. That made me an expert. I have nearly 2,000 cookbooks, and they’re nearly all about baking and breakfast and bread. You know how many times people have said to me, Why don’t you open at night? But we’re committed to being an international leader of breakfast specialties. You also need a dash of salt in the recipe—a little bit of doubt. What could I do to better my product? That keeps me always wanting to learn. Will I ever retire? Retirement is a state of mind that we should do when we’re in the box. As the big boss, my office is in my head. How can I retire?
Cliff Lede: Cliff Lede Vineyards
Napa Valley, California | 2002 | 154 full-time employees, 15 part-time
My father was a guy who sealed a deal with a handshake. He showed me that honesty and integrity are important qualities when running a business. The turning point for Ledcor, our family business, was the ability to expand geographically. The moment we had the capacity to move into new markets was a milestone. My brother and I aren’t total opposites, but we balanced each other. There is also a loyalty there—we knew that no matter the challenge, we would be stronger together than apart. My biggest mistake was underestimating the time and energy needed to launch a start-up. Getting any new business off the ground is tough, but wine demands patience and perseverance. Bigger isn’t always better. Not all businesses are scalable. If you do choose to grow your business, make sure you and the organization are really ready. Something I learned from Ledcor is that you should hire the best people and give them the opportunity to share in the company’s profits. When the company is successful, everyone benefits. At first, putting my name on the vineyard was awkward—I didn’t want to do it, but my management team convinced me it was important. They said, and now I see, that by putting my name on the bottle, it is a commitment to the wine inside. We are always looking. I enjoy the process of evaluating options, and the deal itself is a real thrill. The acquisition of Breggo Cellars two years ago, an Anderson Valley-based winery focusing on aromatic whites and Pinot Noirs, was a great fit. Any new acquisitions will be done to further diversify our wine businesses. You should find pleasure in what you do, particularly when starting up a business, because life is short. New companies demand a lot of effort, and you should be able to wake up in the morning and feel good about what you are doing.
Lise Watier Lise Watier Cosmétiques
Montreal | 1972 | 2,009 locations | 162 employees | Approximately $55 million revenue
I did not have a goal, except one: to conquer the world. I didn’t have any financing from a bank. I started the company with a very limited budget—maybe $25,000. When I was teaching women at my school—etiquette, how to walk, how to apply makeup—I had to use foundation from this brand, lipstick from another, mascara from another, to satisfy my own criteria. I thought, “You know, I should just make my own makeup.” I believed strongly that if it would satisfy my own needs, it would satisfy the needs of women around me. Before I launched in 1972, I did a marketing study that was a catastrophe. Nobody believed in the Lise Watier beauty line—and that gave me the adrenalin to prove them wrong. When you grow a business day by day, you don’t even realize it. It’s a natural type of evolution. It’s like growing old. When you look at yourself in the mirror, you don’t see the difference. I’m still 28 or 48. I’ve had a few setbacks. I had a fire that destroyed my whole office and warehouse in 1990. We never could find out what happened. After the fire, bankers wanted to have their loan back. But I guess the spirit never left me. I would get up in the morning and prove the bankers wrong, and I did, because I had faith—I believed in it so much. I think I’ve fired two people in my whole life. I don’t have the temper for it. I’m the reverse of Donald Trump—I’d rather say you’re hired than you’re fired. Beauty is emotion. I’m in the business of emotion. Women are very sensitive. They have a sense of insecurity vis-à-vis their beauty. I was married, I was in love, I had children, I was divorced. I was filled with a lot of emotions—good ones and not-so-good ones. I understand women because I am one. I haven’t done any advertising for 15 years. I am no longer the face of the company. The brand outgrew the founder, which is what I wanted. One person cannot make miracles, but a group of women can move mountains.
Bruce Poon Tip: G Adventures
Toronto | 1990 | 1,350 employees | Offices in 15 countries, tours in 100 | 100,000 travellers each year | $150 million revenue
The turning point, for me, was around 1992, when I realized that Canadians only get two weeks of holidays, and I was running a holiday company. That’s when I first approached the idea of exporting tourism, which was revolutionary. This was before e-mail or even the fax machine. The idea of a German booking an African safari with a Canadian company was unheard of. I had to reinvent the space by offering a new style of travel that involved local transportation, local accommodations, culturally focused, fair-trade prices. It was ecotourism before the word existed. Outside of funding, my biggest challenge was getting people to understand what we were doing. If people saw an ad for a tour to Thailand, they’d think of an air-conditioned coach, staying at a Best Western hotel, and a Canadian guide with a microphone. Half of my employees, I might never meet, and I have to get them to love my company and make them want to work hard. That’s a very different type of leadership. I travel a lot of miles, but social media has made it much easier. Twitter has revolutionized our business. Facebook has done the same thing. We have the ability to deliver our culture anywhere in the world now. When you start to hire staff, you hire people that you like or you relate to or want to have a beer with. They are like you, and they have the same skills as you. But you need to look for people who complement your skills. You have to find people who fill your weaknesses. They will kind of irritate you. People who are extremely anal and make lists bug me, but I totally need those people. Know your audience. Entrepreneurs spend too much time on the product when they have to know who’s going to buy it. There are lots of people who can put out good products. The minute you do, someone will knock you off, and they might do it cheaper and faster. The skill is in the selling.
JR Shaw: Shaw Communications
Calgary | 1966 | 14,000 employees | $4.7 billion revenue
My dad always said, hire better people than you, and keep them. You don’t want to have turnover. When I moved out west from Toronto, I was starting the business from scratch, calling on all these oil and gas businesses. My dad would say, when you’re in those office buildings, say hello to everybody. Talk to the janitor, because next time you come in, the janitor could be making the decisions. Both my sons started at the very bottom—Brad in the call centre, Jim laying cable. They would not have got where they are if they weren’t qualified and didn’t love the business. I always said, you’ve got the first opportunity, and if you don’t want it, we’ll just have to go to professional management. I remember when we were buying out the Jeffery family in Woodstock, Ontario—they owned London Life. Joe Jeffery, a good friend of my dad’s, said, “Young man,”—I wish you could say “young man” today—“let me tell you a few facts of life. One of them is the future wealth of this country is owning land and buildings and real estate. Cable television is nothing more than a passing fad.” I never, ever forgot that. That was written in my brain. But we just kept plugging ahead, and it is what it is. I have a love-hate relationship with the business. I love it because it’s always changing. I hate it because it’s so capital-intense. Ted Rogers started from pretty humble beginnings. He used to tell me, “I had all these bills to pay and not enough money to pay them. We’d put all the invoices in a big jar, and if your name got drawn out, you’d get paid.” I try not to get too involved in the detail. I just want to have a sense of where it’s going and a gut reaction that it’s the right thing to do. One of the acquisitions I didn’t make early on was The Weather Network. I made too quick a decision and passed on it, and I’ve regretted it. If you’re in negotiations, never leave a table that you can’t return to. If you disagree, leave it in such a state that you can come back to the table. Keep yourself open. Like when we were dealing with Goldman Sachs and the bondholders in New York on buying Global, we hung in, and see what happened? This is one life. You need to enjoy it. I have slowed down a lot, but they’ll probably carry me out of the office in a pine box one day.