No sum­mer break for these stu­dents

Next Canada tough­ens fu­ture en­trepreneurs

National Post (Latest Edition) - - ENTREPRENEUR - Rick Spence Growth Curve Rick Spence is a writer, con­sul­tant and speaker spe­cial­iz­ing in en­trepreneur­ship. rick@ rick­spence. ca Twit­ter. com/ Rick­Spence

You’re 22 again, and sit­ting in school. A re­ally in­flu­en­tial per­son is com­ing into the class to­day, and your teacher says, “What question would you like to ask?”

While you think about that, here’s a lit­tle con­text. The class­room is in an old en­gi­neer­ing build­ing at the Uni­ver­sity of Toronto, and you’re one of Canada’s best young en­trepreneurs. This is the class­room of the Next 36, a pro­gram that se­lects and funds 36 ( or so) high- per­form­ing stu­dents ev­ery year in or­der to trans­form them into high- im­pact en­trepreneurs, ready to think big and cham­pion change all their lives.

Last year, the Next 36 re­branded as Next Canada, and now runs two more pro­grams: Next Founders, for more ad­vanced star­tups, and Next AI, for en­trepreneurs ex­plor­ing the po­ten­tial of ar­ti­fi­cial in­tel­li­gence. Par­tic­i­pants in all three groups have one thing in com­mon: they all take Next’s cus­tom­ized courses from May to July. To help you, too, be­come a high- im­pact en­tre­pre­neur, I sat in on a re­cent class led by one of Next’s four co-founders, Reza Satchu.

He’s not your e ver y - day teacher. Reza and his brother Asif co­founded a Bos­ton- area sup­ply- chain au­to­ma­tion com­pany in 1999. They sold it 18 months later, in the last days of the dot- com boom, for US$ 925 mil­lion. Satchu went on to launch a stor­age com­pany, co-found a se­cu­ri­ties-trad­ing com­pany in New York, and talk his way into teach­ing a street- smart en­trepreneur­ship course at U of T. In 2011, Satchu co­founded Toronto in­vest­ment firm Align­vest, which seeks out high-re­turn busi­ness in­vest­ments rooted in dis­rup­tive “mar­ket dis­con­ti­nu­ities.”

So what can you ex­pect from a prof like that? Tough ques­tions, rig­or­ous analy­ses and bold in­sights that could only come from some­one who’s done it — again and again. Ex­am­ples: ❚ Whether you’re start­ing a new busi­ness or launch­ing a new prod­uct, don’t un­der­es­ti­mate the chal­lenge. “Get­ting your first cus­tomer is hard,” Satchu warned. “You have to get a cus­tomer to sus­pend dis­be­lief and make a risky de­ci­sion.” When he was start­ing the busi­ness in New York, he says, “240 peo­ple — very smart i nvestors — turned us down. You need to prove cus­tomer de­mand. And we couldn’t prove it. ❚ “What­ever you do in busi­ness, re­mem­ber you’re bei ng watched. “The early de­ci­sions you make in your ca­reer re­ally mat­ter,” Satchu said. When he and his brother started Sup­pli­erMar­ket in 1999, while still in their 20s, “ev­ery sin­gle per­son who had worked with my brother and me from age 20 to 25 in­vested in the com­pany. They had worked with us. They trusted us. They thought it could make some money, and they knew we would do the right thing.” ❚ Find in­for­ma­tion oth­ers don’t have. For this class, the at­ten­dees had all read a case study, on the early years of stylish hand­bag de­signer Kate Spade. Satchu’s key question: Was this a good busi­ness to be in? One stu­dent said she loves Spade’s prod­ucts; but a nother pointed out the mar­ket was small, with lots of com­pe­ti­tion. Satchu squelched the de­bate by say­ing your suc­cess doesn’t de­pend on the state of your mar­ket — but on what you are do­ing dif­fer­ently. The founders of Kate Spade had spot­ted an “ac­ces­si­ble lux­ury” niche in the de­signer mar­ket, and slowly made it their own. Many en­trepreneurs, Satchu says, try to out- think the mar­ket and go where com­peti­tors aren’t. They pre­sume big en­trenched play­ers have all the bases cov­ered. Think again. Con­sider how Michael Dell stole the cus­tom- PC mar­ket from un­der IBM’s nose, and how Jeff Bezos founded an on­line book­store be­cause he felt sure Barnes & No­ble was un­der­valu­ing the In­ter­net. “En­trepreneurs make stuff hap­pen out of thin air,” Satchu said. “The most im­por­tant thing you need is in­for­ma­tion. Mas­sive amounts of i nfor­ma­tion. And you have to be as clever about it as pos­si­ble. ❚ “Know your num­bers: When Satchu asked if Kate Spade circa 1998, was do­ing well, the stu­dents of­fered that the com­pany was en­joy­ing high sales per square f oot, and rev­enues were grow­ing fast. So Satchu ad­vised them to take an­other look at Spade’s fi­nan­cial state­ments. They’d see that in­ven­to­ries were up, cash was stretched thin and prof­its were falling. “On the sur­face, the busi­ness is do­ing well. But when you look a lit­tle deeper, you see mas­sive prob­lems,” Satchu said. “The num­bers don’t lie.” ❚ Find a way to con­nect! Just be­fore in­tro­duc­ing a guest lec­turer (se­rial en­tre­pre­neur and Cerid­ian CEO David Os­sip), Satchu asked his stu­dents what ques­tions they might like to ask him. They re­sponded with such sug­ges­tions as what he’s learned in his ca­reer and which op­por­tu­ni­ties he is most ex­cited about. “No,” Satchu said. When you meet a suc­cess­ful, in­flu­en­tial per­son, don’t ask them some­thing they’ve heard a hun­dred times be­fore. Think harder and more cre­atively. “If you ask them some­thing very dif­fer­ent, you might get more of their time.” Then Satchu took it a step fur­ther. “What very self­ish thing might you ask?” The stu­dents looked puz­zled. But Satchu was just ask­ing them to be strate­gic. If you need a re­fer­ral or a favour, ask for it. But build a re­la­tion­ship first. Find an el­e­ment of com­mon­al­ity that draws you closer. “Make the question about some­thing that con­nects you,” said Satchu, “and maybe you’ ll get a share of their time.”

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