Recession? For sure. Depression? Maybe. The most telling statistic for me, as the former CEO and chief investor in Cobourg, Ont.-based Arxx Building Products Inc., is that U.S. housing starts are down from an annual rate of almost two million per year to just 680,000. What could you possibly do to grow your business when your market is cut to 33% of its former self? Let me put that question in more universal terms: how are we going to get out of this mess?
Advice is everywhere. The monetarists say we should cut interest rates. The supply-siders say we must reduce taxes. The born-again Keynesians want massive deficit spending to prime that proverbial pump. How about all three? We’re cutting, we’re reducing and we’re priming, too. Will it work? Who knows? Historians say the Second World War was what really got us out of the Great Depression. World War III is not my idea of a stimulus package.
To paraphrase our ideological foe, Karl Marx, I say this: “Entrepreneurs of the world ignite.” Governments can cut, reduce and prime all they want. It will be entrepreneurs like the readers of this magazine that will make the real difference. It is people like you and me who have to:
- take advantage of low interest rates to make business-building investments
- invest our growing tax savings in new products, more marketing and productivity improvements
- grab some of those infrastructure dollars and spend them wisely to build our companies and our country.
It is in the dreams of our entrepreneurs and innovators that recovery truly lies. Dream on! We must get past the Nortel Nightmare and worry not about what can’t be done, but obsess over what can be done. Dream big, like Jim Balsillie and Mike Lazaridis at Research in Motion have done for years. Or dream small, like my 26-year-old stepson, Jon. His new company, launched with ideal timing in January 2009, already has six employees and plans for more. I just got an e-mail from him describing an idea for an investment in another concept. Entrepreneurs truly are the Energizer Bunnies of business.
Ted Rogers tells many such stories in his autobiography, Relentless. (He clearly was relentless. I think he was the pacesetter for the Energizer Bunny.) One that applies here is the story of his quest to pursue his wireless dream. He was turned down by his own board and had to invest his own funds to get the wireless venture started. He believed in his dream. Was he a madman, or was his vision realistic? It all looks great in hindsight, but, as he pointed out, it was far from clear at the time. Cellphones were clunky, unreliable walkie-talkies, their battery life was around an hour and there weren’t many networks to place calls over. But Ted believed. He put his money down. Rogers Communications later agreed with his vision and bought him out. Wireless now constitutes 75% of Rogers’ market valuation.
“Hundreds of students running painting companies across Canada and the U.S.?” So pondered the vice president of paint giant Sherwin-Williams as he looked at me quizzically in those long-ago years when I was starting up College Pro Painters. “Are you going to guarantee their accounts?” The answer to his first question was “Yes.” The answer to his second was “No.” All my money was already on the line for startup marketing and recruiting. He didn’t believe. Fortunately, Glidden was more accommodating, giving us our start in Ontario. Sherwin-Williams later changed its mind and pitched our account.
A more recent example comes from the little charity that could: the Toronto Christian Resource Centre (TCRC), which is located in Regent Park, a crumbling social housing development in downtown Toronto. In 2004, the TCRC board faced a major decision. The whole of Regent Park — including the TCRC’s building — was slated for demolition as part of a massive redevelopment project. Should they close down? Move to another part of the city? Rent nearby?
No. The right thing to do was make the highest and best use of the TCRC’s land asset by building 87 units of affordable housing. For an organization struggling to cover $700,000 in annual operating expenses, it was a minor $19-million investment! I’m now chairman of the TCRC, but if I’d been on the board at the time I would have been like the Rogers board when Ted went wireless, and said no. Go figure: we’ve raised 84% of the $19 million, and shovels are slated to go in the ground this summer at 40 Oaks, where the TCRC will continue its mission of helping people help themselves.
So, my fellow entrepreneurs: bet something on one of your dreams this year. You have them — I know you do. You don’t have to be like Ted. You don’t have to bet the farm. But bet something. Bet a person, bet a program, bet something. Be sure to put in enough of yourself and your money so that you are truly “into it.” That will make all the difference — but only if you believe.