Back in 1981, my brother Bill and I invested $4,500 to open a retail merchandising company in Toronto. We started out small and went on to achieve a fair amount of success.
It was a far cry from playing professional hockey, which I’d previously done in Europe for four years, but as I’d long been interested in entrepreneurship, it was an equally thrilling experience and one that proved to be both professionally and personally fulfilling.
In the nearly four decades since, I’ve invested in and held leadership positions in a number of other companies including Ethoca Solutions Inc., a fraud solutions and e-commerce provider that was acquired by Mastercard International in 2019; Amsterdam Brewing Company, a craft brewery that also owns a brew house and barrel house and several residential real estate ventures, including Novacore Communities, Zest Communities and StudentHouses.ca. I also own and breed thoroughbred and standardbred horses.
As you might imagine, successful entrepreneurs are often pitched new opportunities. I know I am. And although I’m very people-oriented and love being on the ground floor of something new or something that’s about to explode, I also have to be judicious. So there are three questions I always ask when presented with new opportunities.
Is it something to which I can relate?
Of the proposals I receive, very few are for companies or in industries in which I have much if any experience. Since my time is limited, I only want to be involved in something that I can get excited about. Take the horses I breed. I love the horse world and am always excited to meet, mingle and do business with other horse people. I know the landscape quite well and am completely comfortable in that environment. I look forward to these types of interactions. Because of that, I’m glad to invest the time and finances it takes to build a strong and profitable presence in this industry.
Is it financially viable or profitable?
The first priority of any business is to be profitable. This doesn’t always mean that a business will generate large revenue the moment it’s launched. In fact that seldom happens. But before investing in any venture, I like to spend a little time with the balance sheet or financial projections. For an existing company, knowing its history is important. For a startup, I need to understand and agree with the profit projections and ensure that they’re realistic and reasonable. If it’s doing well already, well, tell me more. If it looks like it’s not going to earn more money than it spends, it’s probably not worth the effort. If it appears to potentially profitable but it’s not currently managed in a way that’s delivering on that promise, and I can play a part in making it successful, I might consider investing in it or taking on a governance role as a board member.
Who are the people behind and involved with this company?
I’m very much a proponent of working with good people, hiring the best employees and helping everyone leverage their skills and talents to grow a business from infancy to maturity. I like to learn about the people in charge, so to speak. Are they good, honest, driven, and innovative people with whom I’d be proud to partner?
On the employee side, we need to realize that people buy from people. That’s a fact. So it’s crucial that anyone who wants to align with a company in a leadership or investment position realizes this and commits to hiring and collaborating with good people and developing their people skills. The world is now busier than ever before, which has led, unfortunately, to a certain minimization of personal contact between companies and customers. So I need to know that I’m working with a company that actively practices this, cares about its customers and treats its employees well. They’re your ambassadors, and their work will play a huge role in a company’s success — or lack of it.