Cameron Smith does not bring home the bacon. In fact, he makes it himself. For up to 100 hours a week, six month per year, Smith and Dana Ewart, his partner in both business and life (they sign emails from their work account “Cam and Dana”), make pretty much everything themselves – from peach galettes with fruit that was just plucked from the tree to elaborate al fresco dinners at wineries sprinkled through the Okanagan.

Originally from Ontario, the pair were kitchen competitors at top restaurants such as Toque! in Montreal and Scaramouche in Toronto before ditching their high-stress jobs to take a semi-sabbatical. After a stretch as tree planters, the 30-something pair set up Joy Road Catering in the basement of their home near Penticton.

Cameron Smith and Dana Ewart of Joy Road Catering

The work is still high-stress, and the challenges these entrepreneurs face is a little unusual. “It’s a lot harder dealing with hippie farmers,” Ewart says. As Smith puts it, “In a restaurant there are multiple deadlines and they can seem life or death at the time, but if a farmer has something more important to do they will bring that lamb tomorrow. Or if the raspberry field is wet, they won’t go out and pick the berries even though we’ll be pulling our hair out because we have a dinner that night with a dessert that needs raspberries.”

The perks of self-employment, however, outweigh the frustrations. “The restaurant industry is very fickle. You get a good review one day and the phone rings off hook. But if you don’t get reviewed for two weeks, your restaurant is dead,” Smith explains. “There was a real opportunity for us here. The ingredients were here, the farms are here, the wine is here and the clientele have educated palates and are excited about what we do. I think we’d still be successful in the city, but people here they get it. They see the vines, see where the wine came from, we see the person who grew the carrots.” Lower start-up costs and overhead make catering a smart business move for a chef. The ability to, as Smith puts it, change a menu on a dime, rather than sticking to a stale two-month old menu, for instance, is another benefit.

Ewart and Smith only operate when they can get fresh local food, which packs a year’s worth of revenue and work into half the time of a traditional catering company. They start up in May when the first wild watercress and peas become available and shut down when frost hits in November.

A typical day goes something like this: Wake up at 7 a.m., answer emails, make phone calls and write up shopping and prep lists. Create a schedule for that night’s event, assign staff tasks for the day, and write lists of what equipment and special ingredients they’ll need. At 10 a.m., the four full-time staff arrives (they also have a bunch of part-timers) and everyone preps food until 1 p.m. The staff takes turns cooking for the daily sit-down lunch – no brown bag lunches here – which is often the only chance they have in a 16-hour day for a proper meal. Later in the afternoon, they pack up the vans, triple-check their checklist and head off to the venue, where Smith and Ewart have 10 minutes to make themselves at home in a foreign space. The day ends sometime around 11 p.m. when they drive home, unload coolers, wash dishes and go to bed. Then they repeat that almost every day for the rest of the season.

“It’s pretty nuts. In summer, we’ll stay up all night Friday baking, go to the farmers’ market on Saturday, have our crew prep all the produce we bring home that afternoon and then it’s show time: two different weddings on Saturday and dinners at wineries on Sunday,” Ewart says. All told, they feed about 500 people on a given weekend, then spend Monday – their busiest day – ordering food and clearing through paperwork. “We crash in November.”

Like their schedules, the Joy Road Catering “office” – actually a basement kitchen retrofitted to accommodate Smith, Ewart, four full-time staff and a bunch of part-timers – is unusual. We counted nine pairs of prongs, for starters. Below, Ewart and Smith describe their space.

Ewart (far right) and Cameron Smith (in chef's white) preside over the Joy Road HQ

Anatomy of  a Kitchen

+ The pair went to an auction sale and, as Ewart puts it, “set ourselves up on quite a dime.” The chopping blocks ($75 each) came from an old butcher shop. “They have a history. They’re made with gorgeous piece of wood and have railway ties going through them,” Ewart says.
+ Big French doors lead to the garden and chicken coop. “We have a rocket launcher out back that we bought from our dear friend Angus An at Maenam restaurant in Vancouver. We use it to sear meats and make huge stocks and batches of steamy jam,” says Ewart. Every piece comes with a story. “There’s a crew who moved west and opened our own businesses at the same time. It was neat going through all those growing pains of opening our own business.”
+ Posters from numerous events Joy Road has worked at decorate the walls. Other art includes an oversized photo of an unlikely source of culinary inspiration: Albert Einstein. “It’s says something like great spirits have always encountered violent opposition,” Smith says. “It’s kind of tongue-in-cheek, but it symbolizes how you need to go your own way, do you own thing, you cannot care what the establishment will say.”
+ The best part of the Joy Road headquarters is the view of the Okanagan – not to mention the outdoor beer tap. “That’s also where we keep our fridge,” says Smith.
+ “We prep in this kitchen, but our office is wherever we’ve been hired to go,” Smith explains. “The challenge is to haul around an entire kitchen of equipment and the food that goes with it.” U

Johanna Hoffmann, managing principle, Oomph Group Inc., Toronto
On the Idea: They’re running lean and mean, and that’s key for cash flow. Their overhead expenses are not high at this point, and they also have a financial cushion that will carry them through 2010.
Red Flags: The whole thing swings on this machine. Innovequity’s managers acknowledge that the prototype may require adaption for each site. If it requires a significant redesign, they’re going to be eating their cushion of cash.
Next Steps: They need to continue to be conservative until the machine realizes the savings projected and clients see it operating in the field. Until then, they should really not spend any money beyond the core, which is getting it built, transported and installed on the site. Until the first client is thrilled and one builder after another is coming in the door, mouths dropping open and asking, “How can we buy one?” they should minimize every expense.

Bill Erichson, owner and educator, Pacific Training Innovations, Vancouver
On the Idea: The business model relies on a royalty-based system rather than a sale-of-product system. This means that Innovequity’s profits and cash receipts are deferred. They are effectively both the manufacturer and financier of the first two units.
Red Flags: There are two critical issues in any cash flow forecast for a business start-up: the starting cash position (capitalization) and the time it takes to become cash self-sufficient (burn time). Innovequity has serious problems on both accounts. The business model has stretched the burn time for this company to an extent that there is a greater need to finance this business.
Next Steps: Develop a monthly cash flow and carefully manage it. As royalties accrue, the company could sell this annuity for a lump sum to reduce debt and further develop the business. Remember, there are two ways to go broke in business. No profit is the slow, painful way; no cash flow is the fast, painful way.

Cindy Priebe, CMA, vice-president, corporate services, CMA Alberta, Calgary and Edmonton
On the Idea: The company appears to have conservative sales projections. Furthermore, they have considered the manufacturing warranty as well as the risk of downtime for their customer should the machine break down.
Red Flags: Although pro forma balance sheet and income statements are necessary, I’d recommend a cash flow statement, because entrepreneurs often underestimate the timing of cash flows. Innovequity may run short of cash, leading to an inability to fund future purchases, such as inventory to manage repairs. They should perform a sensitivity analysis to cash flows to project best and worst case scenarios, in case the cash they expect through sales or royalties for instance is not collected. The company acknowledges the potential for debate with the customer on cost savings. If a customer feels they do not realize the cost savings that translate into royalty payments, they may hold payments to negotiate a better rate.
Next Steps: The company should prepare a pro forma statement of cash flow along with a sensitivity analysis to determine the impact on cash flows if their estimates on collections or sales do not come to fruition.

Donald Gutstein is all for capitalism. He just doesn’t like the way it’s been done in the past 30 years and wants the propagandists, policy wonks and media to account for themselves. He is what was called a rabble rouser in the olden days and today is called, well, something else. Now the media critic and author of the new book Not A Conspiracy Theory: How Business Propaganda Hijacks Democracy, talks to UL about abandoning a career in architecture, the problem with think tanks and how capitalism should really work.

+ It was a different universe when I was in school. Education was cheap, jobs were plentiful, nobody had to worry about what they were going to do with their lives. Now you need a career plan. We used to take a course because we were interested in the subject, not because it would help us get a job.

+ I wanted to make a difference for our environment, and I had a dream to design beautiful structures for people. But I found out that architects are just cosmeticians. By the time an architect gets a project, all the major decisions have been made by the planners, by the developers and financiers. Really, there wasn’t room to do much in architecture.

+ As a citizen activist fighting developers in Kitsilano, one of the things I had to do was find out about the developers. I kind of became an expert in research. I happened to know a faculty member in the SFU School of Communication who was teaching a research course, but she wanted to do something else. So I started teaching a documentary research course and worked my way into the field of communications that way. I don’t think you could replicate that [career trajectory] today.

+ Capitalism worked really well in Canada and the U.S. from the 1950s to the 1970s. The economy was growing, there was almost full employment, people had good wages and they could buy houses and cars. That was a great period in capitalist history, so Not a Conspiracy Theory is not an attack – it’s a critique of what’s happened since.

+ Capitalism works best when government is in control, when there’s proper regulation of some of its excesses. I mean, just look at what happened last year in the financial market; that pretty well happened because of deregulation over the past 20 years. So maybe it’s time to reinvent capitalism, but they need to know what to do in order to have capitalism actually solve people’s problems.

+ Repetition is one the key aspects of any successful propaganda campaign; so any kind of an index that [think tanks] can put out every year is excellent. I fault the media most for never laying out the relationship between think tanks and funding sources. Like, for instance, ranking hospitals as good and bad, like they do in British Columbia. It’s expensive to accumulate all of those statistics, and manipulate and analyze them. Who’s paying for those rankings? Who would benefit from those rankings? Nobody asks those questions.

+ The issues that the mainstream media give the most coverage, well, those are the issues that the public think are the most important and then become the issues that the decision makers turn to. It’s calculus. If a newspaper has a story on the front page for a few days, people will tend to think it’s an important issue.

+ The right to know is critical. You just need to know what’s going on, so you can make your own decisions. U

Eric Poulin had never attempted a back flip until he tucked into a giant terrain park jump at the Lake Louise ski area. Some of his first attempts were not pretty and the falls should have hurt, maybe even broken a bone. Instead he said, “Falling felt great.”

Board Member: Aaron Coret (bottom left, in ballcap) of Katal Innovations

Poulin is an adrenaline junkie with a high tolerance for pain, but his confidence is more than an athlete’s brash ignorance of the risks of the sport. Lining the landing zone – the place where Poulin’s body should have collided with enough force to paralyze him – was a five-foot-thick air pad designed to cushion the worst terrain park wipe-outs. “It’s like landing in deep [snow],” Poulin says. “When you fall the pad absorbs all the force you give it.”

Known simply as the Landing Pad, Poulin’s cushion was designed with intimate knowledge. Aaron Coret, one of the designers of the pad, is in a wheelchair today from a bad crash in Blackcomb’s terrain park. As he lay in a hospital bed, Coret came up with an idea for a product that would help other people avoid the dangers of the sport. Along with Stephen Slen, his business partner and a fellow engineering student at the University of British Columbia, Coret’s nightmare evolved into a school project and now into Katal Innovations, the company the duo started in 2007 to sell the Landing Pad around the world.

The 15-by-27-metre pad is anchored below the lip of a terrain park jump and runs to the end of the runout zone. An air compressor fills two chambers to a combined width of 1.5 metres. Miss a jump and the pad softens the landing; land properly and it feels like landing on snow. Coret and Slen hope Landing Pad will help prevent accidents like the one that cost Coret his passion, but they have two other objectives: to create a safer way for top level skiers and boarders to learn new tricks. If they succeed, Landing Pad could open terrain parks up to a whole new group of riders. “The terrain park is a fantastic place, but it can also be a scary place,” says Coret, who looks at the Landing Pad as a way to give back to the sport he still loves. “I want to bring people into the freestyle, who are afraid of going in the terrain park or half pipe because they’re afraid of getting hurt. I want to create a new safety standard.”

With the help of an angel investor, Katal was able to build its first prototypes. After a few private test sessions on the Blackcomb Glacier in summer 2008, Katal rolled out its latest incarnation in May 2009 at Lake Louise’s terrain park. On what is traditionally one of the slowest weekends of the year, more than 365 people showed up to give it a try.

Bolstered by that success, the duo is now busy balancing fourth year engineering courses and launching a company. A private investor has come forth with a much-needed injection of capital. (The specifics haven’t been finalized and Coret declined to provide details.) Factories have been sourced and they’re working now on finessing the business model and pricing.

“We realized that if all we did was sell Landing Pads we won’t be able to support ourselves in a few years. We need a continual income,” Coret explains. The plan is to lease to resorts three sizes of pads – the original size, a smaller “beginner” version and an off-snow model – on a yearly basis, providing a service and warranty to go along with the product. For Katal this plan ensures they don’t sell themselves out of work and that they retain some control over how the pad is advertised and used.

This control is about more than monitoring their image – it may help limit their liability. Katal Innovations will train ski resort staff to properly set up and manage the system, help create guidelines for use and develop signage and instruction for the public. Coret’s wants the Landing Pad to become an industry standard that will work with terrain park signage. In exchange, he says, ski hills get a new product to offer their customers, a safe program that should reduce injuries, first aid costs and liability, along with additional revenue by charging a service fee to use Landing Pad.

Now all they need to do is make some sales. Ski resorts and camps all over the world, from New Zealand’s Snowpark to Lake Louise, have already perked up and Katal is taking the Landing Pad on the road this winter to resorts across North America. Coret and Slen will measure lift ticket sales to use in their sales pitch and create a grassroots interest among riders. “Ski hills rely on snow to draw crowds,” says Coret, adjusting his straight brimmed ball cap, just off centre. “But weather patterns are changing. In a bad season they need something else to create the draw. We think this is it.” U

When Innovequity’s founders, Ben Bertrand and Mark Holtom, built the GCU prototype, they had a dream arrangement: access to well-equipped manufacturing and research facilities at Northern Alberta Institute of Technology (NAIT). But with the first orders on the horizon, they need to decide how they’ll manufacture the GCUs on a larger scale – and they need to do it economically and efficiently, or watch their profits disappear. Oh, and there’s one more challenge: they don’t want to do it themselves.

“Obviously we know we’re handing away a portion of the profit to a manufacturer, but that’s part of life,” says Holtom. “We have to consider the capital cost for us, risk versus reward, and recognize that there is still profit.” That leaves Innovequity with an age-old debate: to sign a contract with a Canadian manufacturer willing to take on extra business or seek a bargain overseas.

The Expert Panel
Our panel of experts weigh in on whether Innovequity should outsource their operations to China or India and why they represent the future of manufacturing in Canada

Behind the Scenes
Don’t get into bed with wishy-washy investors! This and other hard lessons the Innovequity duo learned

Video: Pick Up Sticks
A peek at how Innovequity’s Geometric Construction System works

Links
Our round-up of useful links for start-ups from around the web

Every table at Dark Horse Espresso Bar, a café favoured by Toronto techies, is crowded with MacBooks, each computer paired with a hunched-over person clutching a biodegradable cup of iced latte. Amid the glowing screens sit Ken and Garry Seto, brothers and co-founders of iPhone app startup company Endloop. Since recently quitting their day jobs and devoting themselves to app production, the pair has fit snugly into this community.

App Description: Endloop founders Garry Seto (left) and brother Ken in Toronto. Photo by Chloe Ellingson

Before the Seto brothers joined the rapidly growing ranks of app entrepreneurs, they were colleagues at a government health site. “We thought, why don’t we just combine forces like we’ve doing for other people and do it for ourselves instead?” says Garry, now in his loft around the corner from Dark Horse. After quitting their day jobs in late 2008, the brothers worked part time on consulting gigs while they taught themselves how to build mobile applications. Garry, 33, the quieter of the two, does the complex coding. Ken, 41, designs the look and usability of the applications, along with Endloop’s website. By early July 2009, the duo decided to focus on Endloop full time.

An app company is a new breed of bootstrapping startup: overhead is low, so no venture capital is needed, making it a popular activity for amateur programmers who plug away in their basements. The Setos are Endloop’s only employees, but with their industry experience, they hope to make the venture into a long-term boutique-style firm. The pressure to make pro-quality products is immense; thee majoriy apps have less than 1,000 users, while in that competitive top tier (about 116 apps) each one has over 100,000 users. “If you get into the upper echelon” of designers, Ken explains, the opportunity for success is huge. “If you don’t, it’s dismal. There’s no in-between state.”

Endloop now has two apps to its name so far: its first effort, iHeartRate, which pulls in Starbucks and grocery money, and the latest, TweetCapz. This new app, born from one of Ken’s eureka moments, lets you take a photo and – uniquely – crop and instantly upload it to Twitter. (Perez Hilton’s job would have been a lot easier if this app existed a few years back.) “It could be a game changer for us,” says Ken, hoping TweetCapz will make enough to pay the bills.

Each app takes about a month working full-tilt to build. Garry, for one, is at his desk from 9 till 5, has dinner with his fiancé, then works until he falls asleep. “My fiancé said once that my Mac is my wife, my iPhone is my kid and you’ve got your whole family here.” There’s some truth to that. The Seto brothers are working full-tilt to capitalize on the app boom. “I wake up every day with a different idea,” says Ken. Although Endloop is the fourth company the brothers have worked at together, there’s still a hint of their sibling dynamic. “At first, there was a little getting used to each other,” Garry admits. Ken, classic older brother, corrects him: “That was years ago now.”

In the world of iPhone apps, there’s no such thing as moderate success: an app either earns tons of money or next to nothing. It was easier to get noticed when the App Store opened to independent developers in spring 2008. Steve Demeter, the now-legendary creator of the game Trism, announced earnings of US$250,000 just two months after the store opened. Today, apps that don’t appear on one of the store’s front-page lists (What’s Hot, Staff Favourites or Top Paid Apps) are unlikely to pull in much revenue. Of course, some developers get lucky: “If Apple decides that you made a good app, then you’re set,” Ken says, wistfully. “It’s like the hand of God touching down and saying that you’ll be successful and boom: you’re successful,” quips Garry.

The App Store is still an unruly marketplace, filled with loopholes and shysters looking to make a quick buck in the biggest tech gold rush since the dot-com boom. Since January, the number of apps in the store has doubled to 65,000, and some developers are desperate to stand out. Practices such as astroturfing (where a developer posts good reviews of their apps) are often seen. A developer can also ruin its competitor, posting dozens of bad reviews for a rival app. Add to that the confusing rules and regulations Apple imposes on developers. When an app is submitted to the store, it enters a purgatory of sorts. There’s no telling if or when an app will be approved (most app entrepreneurs wait three weeks to a month) and then, with little warning, the app appears on iTunes with none of the fanfare of a traditional launch. Or worse, it is rejected and a developer is back to redesigning the app and waiting in line again.

A day after we meet at the Dark Horse, TweetCapz hits the iTunes store with the less-than-an ideal launch on a Saturday night. To compensate, the boys start promoting immediately: Ken posts TweetCapz of whatever he’s doing (eating cake, attending tech events, demoing videos) while Garry uploads the first reviews to the web. There’s no break, even after the app is completed. Garry, jovial, but tired, says, “It’s a lot of late nights and long weekends.” U

Cutting Corners, 2008 6 x 4 inches, Currency Collage by Mark Wagner

Even though the market has started to strengthen and the economy is picking up, employment is a “lagging indicator.” If pundits say the recession is over, many of us will still find ourselves at the receiving end of a pink slip. Recent Stats Canada reports showed that EI beneficiaries shot up more than 50 per cent (roughly 300,000 Canadian) since last October.

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If you’re still working, what can you do to start or increase an emergency fund? For starters, don’t link your savings account to your ATM card and create a fund that will be easily accessible in an emergency. Canoe’s money section compares rates on a variety of savings products and has a useful section on personal finance

This podcast, I look at other ways to build that fund, including how to earn as much interest in your savings accounts as possible and making such funds – term deposits, money market funds or GICs are options – accessible. They don’t do much good if they’re locked in for five or 10 years.

And if you are laid off, you’ve probably realized that you need to do two things: spend less and make more. Easier said than done, you say? True. But I talk about a few easy things (buy used, sell a second car, downsize your apartment or house), along with some long-term options for the newly unemployed. U

The artwork above is by Mark Wagner, who uses U.S. currency in sometimes irreverent, always clever collages. See more here.

When you opened Vij’s you knew how to cook, of course. How much did you know about business?
Nothing, basically. But my father was a businessman, and through osmosis you learn to become a businessman as well.

My father brought $22,000 cash in a bag from India and I had saved $10,000. If it had gone under, we’d have felt like, “Oh shit, that was a lot of money.”

Vancouver chef and restaurateur Vikram Vij

It was very lean. My break-even point every day was $100. If I did $100 a day, I’d know I would survive. Some days I did $96 or $92. Sometimes I would ring in naan bread or something so that I could feel that I’d done $100 in sales. I cheated myself knowing I was cheating. It was a psychological game that I’d play with myself.

About four months after the restaurant started, a food writer called the Urban Peasant, James Barber, gave me such a raving review that people started coming. Then I was making $130 and $140 a day in sales. And I never looked back.

Was that a turning point?
I was running out of money. I had put the restaurant up for sale. We were all dejected. My father was upset; I was feeling a little bit down. This review came out and people started coming in. Actually, if credit has to be given it’d be to Angela Mills and Robin Mines and all the Vancouver food writers who reviewed the restaurant.

What did you find most challenging about those early days?
People had no idea. The challenge was to show people a more modern style of Indian food – not butter chicken and tikka masala. I made a delicious lamb curry with cinnamon. They still ask for butter chicken, and they’re mad I don’t do it. It’s not their fault; they’re just not educated.

What have you learned about leadership over the years?
I had this old-world way of dealing with the staff by screaming and yelling. I’ve calmed down extremely. But I will still say stuff like, “Don’t you get it? Why don’t you get it?”

The other thing I’ve learned is that we live in North America, and these people are not your servants. They are here to work and help you achieve your goal, so you’d better be nice to them.

If you had to compare your leadership style to one of your dishes, what would it be?
There’s a dish that I’ve just put on the menu called Rajasthan-style goat curry, which is based on my travels to India in April. The meat is slow-cooked for six hours. It’s tender inside, but has very strong flavours. And lots of spices – there’s a conundrum happening with the spices – and a blend of different layers and angles and heat at the back of your palate. I always respect the tradition of a dish, but modernize it by adding blueberries or some acidity. That dish to me is who I am as a human being: Strong, sometimes tender, sometimes spicy, robust and to be enjoyed piping hot.

Today your wife, Meeru Dhalwala, runs the kitchen, while you manage the restaurant. Why did you decide to divide these roles?
Meeru was in Third World development in Washington, D.C., when we met. She didn’t have a working visa. She had no cooking experience. She would just hang out in the kitchen in Vancouver and see what I was doing.

The bigger the restaurant got, the more I was running around. There was payroll to be done, produce to be bought, connections to be made with farmers. And both of us are strong personalities, so we would butt heads on what dishes should taste like. I said, “Look, I can’t work with you and fight with you all day and come home and act like nothing happened.”

She’s the creative force behind the dishes. She will work with me on the menu. She’s also responsible for the emotional well-being of all the women in the kitchen. All these Indian women have some issues at home, family issues and stuff, and they go to Meeru for advice. She’ll say, “This is what you should do: put your foot down; tell your mother-in-law to fuck off.” She’s a force to reckon with.

That’s a very traditional way to develop staff.
Normally when you get accolades and become a big restaurant, you hire executive chefs from outside. But I do it differently: If you stay longer with the company, I will pay you well and you’ll learn how to cook — which builds loyalty, brings consistency to the food and creates harmony within the community. The food shows passion.

You’ve complained that many restaurants are motivated by business concerns instead of passion.
I’m always concerned about restaurants that are driven by concepts. If you don’t love what you do, eventually it will show and you will fail – it doesn’t matter how good a business person you are. I have the passion for food and for wine and for people. I love all these three things.

You make a flatbread from cricket flour. What do crickets taste like?
Exactly like pumpkin seeds. It was my wife who created this dish. She read somewhere that we can eat crickets and bugs, so we made flour and put cricket bread on the menu to see the reaction. The most important thing was the environmental aspect. Crickets are high in protein and low on the food chain.

Do you eat cricket bread at home?
No.

Foodies and critics – of which there are many in Vancouver – consider Vij’s one of the best Indian restaurants not only in Canada, but in the world. If you’re in town, don’t bother making reservations at Vij’s, or its sister restaurant Rangoli. It’s all democratic: show up and wait in line with everyone. Vikram Vij’s newest venture is a series of culinary tours through India. Butter chicken lovers need not apply.

Voice mail is the salesperson’s worst-case scenario. Not for Mark Holtom. When he began contacting 20 customers in Western Canada who he figured would want Innovequity’s Geometric Construction Unit in their assembly lines, he had a sure-fire line to get a call back. “Sometimes I would leave a message and say, ‘Can you give Greg Spicer a call?’” Then he’d give them his own number.

Greg Spicer, a director at the business financing company Sumex, is Innovequity’s CEO and he has a hefty Rolodex. He’s on a first-name basis with most of Innovequity’s potential customers. Those who didn’t know him knew of him. Spicer gives these two young entrepreneurs the opening they need to get the ear of company buyers. Once the prototype is operational and Holtom and Ben Bertrand approach each potential customer again – this time for a one-on-one meeting to deliver a sales pitch – they’ll have both credibility and a history with buyers.

The Expert Panel
Our panel of experts weigh in on Innovequity’s approach to sales and marketing, point out red flags and offer suggested next steps

Behind the Scenes
Don’t get into bed with wishy-washy investors! This and other hard lessons the Innovequity duo learned

From the Editors: Outsourcing Advice for Small Businesses

Links
Our round-up of useful links for start-ups from around the web

Industry experts Ian Graham, Chuck Bean and Debi Andrus weigh in on our start-up’s sales and marketing plan, from pre-selling the client to listening to the voice of the customer.

Ian Graham, MBA, certified management consultant and founder of the business incubator the Code Factory, Ottawa
On the Idea: Innovequity’s approach of targeting builders close to home to start out makes good sense. Having a mentor with industry contacts is also a big plus in getting those first meetings. The fact that they have already made initial contact with prospective customers is great.
Red Flags: Putting plans to further contact local prospects on hold until the prototype is ready is a bit concerning. There is a time-consuming sales cycle associated with winning customers. Working toward getting clients committed to using the prototype when it is ready right away should be the number 1 priority.
Next Steps: Pre-sell the client and then work toward fulfilment. Follow up on your initial customer commitments immediately and work toward finding out who would be willing to test the prototype.

Chuck Bean, president and principal, Baxter Bean, Calgary
On the Idea: They have categorized their clients, determined markets and have created a compelling reason for purchase. This is all good.
Red Flags: Customers can be categorized in a matrix (helpers, blockers and influencers; and technical, economic/user impactors) and by degree of risk acceptance (high, medium, low). Spend time only with those companies that want to take a risk, help you and understand your advantages – beyond price.
Next Steps: The industry you are in has a very narrow street. Word will get out if you are good. Determine if your technology is a trend or a movement, and look for market movers to partner with.

Debi Andrus, assistant professor of marketing, Haskayne School of Business, University of Calgary
On the Idea: The founders have been proactive contacting potential customers and have secured the support of a potential key customer. Their website, which demonstrates the benefits of their offering, shows forward-thinking.
Red Flags: There is no clear marketing strategy in terms of product positioning and branding. Even with an industrial product, there is a need to consider strategies for market entry and development. It is not clear if the “voice of the customer” is being integrated into the design and configuration of the assembly machine. Market research is as simple as asking the customers what they need and the best way to use the new technology.
Next Steps: The sales approach is not about advertising on TV or other mainstream media. However, there is a need to review advertising in trade-specific publications or at trade shows. It isn’t too early to begin pre-selling. The Discovery Channel video opportunity would provide great exposure and useful material for marketing.

Go back to Episode 4.