Jim Treliving: Top 10 tips for small businesses and startups
Jim Treliving, one of the hosts of CBC's Dragon's Den, has been a successful Canadian entrepreneur and investor for more than 40 years. He has homes in Dallas, Palm Springs, Calif., and Vancouver, where his penthouse overlooks the city and North Shore mountains. Although he has had fantastic success in business, he didn't start out as an entrepreneur.
Hailing from the small town of Virden, Manitoba, Treliving was a young RCMP officer in 1966 when he walked into "Boston Pizza and Spaghetti House" in Edmonton and saw big dough in his future. More than 350 restaurant openings later, Jim is now the chairman and owner of Boston Pizza International Inc., with operations in three countries and almost $1 billion in annual system-wide sales. With Treliving and his partner George Melville at the helm, Boston Pizza has been consistently recognized by Deloitte as one of Canada's "50 Best Managed Private Companies" and more recently as one of Canada's "Top 10 Most Admired Corporate Cultures" sponsored by Waterstone Human Capital.
Beyond the restaurant business, Treliving has made investments in many other successful business ventures, including real estate development, sports entertainment and the Canadian oil-change retailer Mr. Lube. He always invests in people first and strongly believes that "behind every great business is a great team." He is well known for his dynamic business vision, can-do attitude and drive for success.
Treliving serves as chairman of both Global Entertainment Corporation and the Boston Pizza Foundation, which has raised $10 million for various Canadian charities since 1990. He is also a director of the Hockey Canada Foundation, dedicated to increasing funding for minor league hockey in Canada.
Despite his often-hectic schedule of business, social and philanthropic commitments, Treliving is always on the lookout for that next great opportunity. Here are 10 pieces of advice he has for small businesses and startups.
1. Know what you don't know
I'd advise entrepreneurs to know when to get outside help for their business. When I started the first Boston Pizza franchise, I tried to do everything myself. I wanted to save money, but what I learned was that paying for some professional services — like taxes and accounting — helped my business far more than the value of saving a few bucks.
2. Get moving
Some startups get caught in endless planning without taking actions to make the business a reality. It worries me now as an investor when I see a beautiful business plan without any concrete steps taken to achieve the objective. I don't buy plans, I buy businesses.
3. Determine market demand
The most heartbreaking stories on Dragons' Den often involve entrepreneurs that have spent their life savings designing and building a product that has little or no market interest. I strongly recommend that entrepreneurs go to potential buyers early on and test the demand, understand the pricing limits and modify your business accordingly.
4. Understand the value of your business
Many entrepreneurs are so emotionally invested in their businesses that they vastly overestimate the actual value of their business. There are traditional methods for valuing businesses, like a multiple of earnings or comparable transactions; so don't just throw out a number with lots of zeros that sounds good or you'll turn off potential investors before they even look at your business.
5. People First
I've invested in some mediocre businesses just because I believed in the person or people behind them. I've also turned down seemingly excellent investment proposals because I didn't get a good read on the principals involved. I'd advise small business people to remember how important their image is when dealing with potential customers, partners and investors. This is equally important when you are hiring employees that will represent you and your business.
6. Consider a franchise
Some entrepreneurs put too much emphasis on creating something brand new. I certainly respect innovation, but the advantages of building off a proven, successful business platform cannot be overstated. I didn't come up with the original idea for Boston Pizza restaurants, but I recognized the potential for expansion and started the very first franchise. I still believe some of the best opportunities out there today are in franchising of existing businesses.
7. Hire for fit
Boston Pizza was recently named one of Canada's "Top 10 Most Admired Corporate Cultures," and we attribute much of that to our practice of selecting new employees based on how they fit with our existing culture. Of course the required technical skills are a must, but we have found time and again that new hires work out best when they enjoy the people around them and feel good about coming to work every day.
8. Be prepared to take risks
I have always been a risk-taker in life and in business. I left a great job and pension with the RCMP to run a pizza restaurant. There are just times when entrepreneurs have to roll the dice to be successful. Be prepared to take risks when opportunity knocks.
9. Build your network
Starting out, I admit I wasn't really a chamber of commerce type of guy. I didn't spend a lot of time networking with other business people, sharing resources and new business ideas — mostly because I was too busy working. I've developed a great professional network and realize how important it is, and that it would have been a tremendous asset earlier on in my career.
10. Ask for money when you don't need it
Most people will tell you the opposite. They'll say, "Wait until you've exhausted all other sources before going to the banks or investors." However, in my experience, that can put entrepreneurs in a dire state when they finally reach out for financing. I like hearing from businesses before they are tapped out of funds, when the business is going well and we can discuss a partnership rather than a looming cash crunch or a fire sale.
My lowest low as an entrepreneur:
There were some very tough times after I left the RCMP to pursue Boston Pizza. My first decision was that I had to succeed on my hard work and get some new financing to make it through the next year. That was a tough time and a low, as I was very close to losing the business.
My highest high as an entrepreneur:
I guess every day brings a new high for me, but one that stands out in my mind is the day my partner (George Melville) and I bought Boston Pizza as a company in 1983. After that, working over the years to make it a great company has proven the best is still to come.