Reality of Risk

Community Futures has achieved a major milestone, celebrating 30 years of service to entrepreneurs and communities across BC. As part of our 30 year celebration, we are publishing The Future of Entrepreneurship Series. Written by business leaders, this series of forward thinking articles will provide insights and opinions in regards to a number of key challenges and opportunities facing entrepreneurs in the future.

Reality of Risk

Dr. David E Bond

Humans can be certain that every day we are alive we are growing older – but we can be certain of little else. Every day we all face uncertainties or risks that affect our communities and businesses, some of which we can limit or neutralize and others which are beyond our individual or collective control. For example, we cannot prevent adverse weather events - wind, rain or snow, earthquakes or even, in some places, volcanic eruptions – though we can make plans to deal with them if they arise. 

Every business, be it a start-up or long-established, faces business risks and most of these can be mitigated if not avoided. Therefore, recognizing risks and their potential impact and determining what, if anything, can be done cost-effectively to reduce negative impacts is one of the most important tasks faced by businesses.

First, consider your business’ key resources. Your finance and accounting records, computer data, inventory, labour force and customer base are all key components. That means the business needs insurance against theft, fire, cyber security, perhaps earthquakes and floods, and certainly business interruption which would provide help after a disaster causing the business to shut down temporarily as seen in Fort McMurray. And, depending on the nature of the firm, key person insurance may be necessary. This insurance provides investors some confidence that either they will recoup their investment or have financial resources sufficient to find a replacement or potential purchaser if the founder or key manager is no longer able to work. These basic actions are really essential.

The records of the company are normally kept in electronic files. First, make sure you have continuous back-up that is stored in at least two, and preferably three, distinctly separate places. Second, and this is just as important, make sure your operations are protected against viruses and hackers. There are any number of providers of the needed services, so take the time to examine your present needs as well as your foreseeable requirements and get knowledgeable advice from trusted and respected providers.

All businesses operate in a changing environment. You need to think seriously about the types and frequency of internal and external reports you will require to understand what is happening to your sales, costs of operation, growth, personnel, and, if possible, what the competition is doing. Those reports will, in turn, provide you with indications of what might lie ahead and alert you to any adjustments you should consider. More importantly, they should make you aware of any vulnerabilities and opportunities. Vulnerabilities require your prompt attention and opportunities may lead to growth -which brings its own financial risks.

To reduce operating risks as much as possible, consider assembling a Board of Advisors of experienced people you trust and respect. Two or more knowledgeable individuals who will provide frank and honest observations and opinions as to how things are going and what, if any, corrective action you might wish to take can be invaluable. This is a vital and often overlooked source of advice to those running any enterprise. They may be interested friends, or have some skin in the game themselves, or be paid professionals, but they should have substantial experience in business.  They should also be willing to make their views known and not always expect you to agree with them. They should know that you will accord their views respect and thoughtful consideration.

Finally, no matter what your enterprise does, it’s highly unlikely you will be doing it alone. The people on your team constitute one of your most important resources and you want to avoid high turnover. Keeping good employees can be the difference between success and failure. My late friend Leonard Lee, the founder of Lee Valley Tools, understood this. He had two cardinal policies regarding his staff. First, every employee, himself included, shared an equal cut of 25% of pre-tax profits as an annual bonus. Second, no employee earned more than 10 times the salary of the lowest-paid worker. As he said, “Empowered and properly compensated employees work hard to make customers happy, and happy customers return often and encourage others to try Lee Valley.”  Leonard was also quick to recognize risks and opportunities. What began as a mail-order operation became vulnerable to postal strikes as it grew and to offset that he started to open retail operations across the nation. Mail-order is still important for sales outside Canada but retail is now a major pillar of the company.

There are risks over which you have little control but they can play an important role in the success of your enterprise. Financial risk is a fact of daily life, but making sure you have a good relationship with your lender or financial institution will stand you in good stead as your business grows. Such a relationship won’t prevent interest rates from going up, but you will be in a better position to ask for assistance if needed. Your lead financial institution can and should provide you with economic forecasts that will allow you to plan better.

There are other risks such as actions taken by governments, local, provincial or national, that include not only levels of taxation but also legislation and regulations regarding social policies from healthcare to labour laws and information requests. Some of these can have enormous impact on your business’ bottom line. Claiming ignorance of the rules is usually not either an effective or a successful defence if you are caught offside. Also, from time to time, these rules change. You will need early warning and perhaps some advice on actions to consider. Your local Chamber of Commerce is a good source of information as are provincial or national trade associations. Your lawyer and accountant should also be consulted from time to time, not only at start-up and year-end but throughout the year, as warranted. 

Thinking about and preparing to manage risks is not always front and centre when an entrepreneur considers a new venture but it should form an essential part of any business plan. Your business plan should not be a promotional document full of hype and unrealistic sales forecasts. It needs to be a well-reasoned and conservative document showing that you have considered the potential risks and know how to deal with them. Potential risks should not automatically be regarded as reasons not to pursue a project you are excited about. But recognizing them and dealing with them, in a deliberate and cost-conscious manner, is a key to success for any enterprise.

Watch for our next article by Jeff Dawson - The Art of Innovation.  

Community Futures is a non-profit community business financing organization created to support small and medium sized enterprises throughout rural BC, paving the way for diversified local economies and job creation.

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Community Futures Funds Rapid Mobile Micro-Learning Software Company

Kelowna, BC – 4th August 2016

Mathtoons Media Inc. (“Mathtoons” or “Company”) is pleased to announce funding from Kelowna based community funding company Community Futures for the “continued growth and expansion” of Mathtoons Rapid Mobile Micro-Learning software platform called Practi.

Practi provides a 360-degree, rapid learning solution that can be accessed from any mobile device anywhere, including within a non wi-fi/ flight-mode environment, converting existing traditional training material into rapid learning format with full analytics of ‘expert’ learning.

Community Futures Development Corporation is pleased to support Mathtoons with the expansion of Practi. In its early stages, Practi has already generated significant interest globally, including from large Canadian and US companies in areas such as airlines, utilities, health care organisations, Fortune100 companies, municipalities, and entertainment and media organisations seeking to transition to mobile learning for their rapidly changing workforces.

Kristin Garn, CEO, founded Mathtoons Media in 2011, designing and building software which enabled the rapid learning and retention of math knowledge for higher education. In 2015, Kristin identified a niche market within the ever expanding Mobile Micro-Learning corporate sector (currently a $10Billion industry, with a forecast of a 36.3% growth per year up to 2020) and has built a team of highly motivated and specialised professionals based in Kelowna and across Canada.

Kristin Garn is known as a true entrepreneur and has been recognised by the Canadian Trade Commission as a top female tech CEO and a “Woman to Watch” by the local Chamber of Commerce.

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Car-sharing co-op adds minivan to fleet

Minivan for OGO Car Share Co-op

Standing next to OGO Car Share Co-op’s new minivan are, from left, co-op executive director Christian Brandt, Interior Savings Credit Union CEO Kathy Conway, Cheryl Miller of the Central Okanagan Foundation and Francis Langevin of the Okanagan Refugee Coalition.

Posted from Kelowna Daily Courier: Thursday, July 14, 2016 8:41 pm | Updated: 8:43 pm, Thu Jul 14, 2016.

With the addition of a minivan, OGO Car Share Co-op has virtually every type of vehicle on the streets.

“We wanted to have a vehicle larger families or groups could access to do errands or get places,” said OGO executive director Christian Brandt.

The new eight-passenger Kia minivan takes OGO’s vehicle count to 11, including a pickup truck, an electric car, three hybrids and five regular cars.

The minivan will be regularly stationed in the parking lot behind Interior Savings Credit Union’s main branch at the corner of Richter Street and Bernard Avenue.

The downtown location is not only convenient and central for co-op users, but is also a nod to the credit union’s support of OGO through the Interior Savings Credit Union Community Investment Fund.

“Interior Savings and OGO are co-operatives, owned by the people who live in this community,” said credit union CEO Kathy Conway.

“Affordable transportation can be a very real challenge for large families, and we hope this new addition will help with their transportation needs.”

The credit union worked with the Central Okanagan Foundation to buy the minivan at the local Kia dealership at a discount.

The minivan purchase was first considered after the car-share co-op asked the Okanagan Refugee Coalition what kind of vehicles it might need for the people it represents. The group is involved in helping Syrian refugee families transition to life in Kelowna.

“Syrian families tend to be bigger, so they need a minivan to get around,” said Brandt.

“The coalition has used co-op vehicles to drive Syrians around and we expect to have Syrian families as members.”

The credit union and foundation grants for OGO also allowed it to buy two child seats and two booster seats for use in any co-op vehicle.

Four of OGO’s vehicles are based in the City Hall parking lot and one each on Queensway Avenue, in South Pandosy, at Kelowna General Hospital, at the Landmark, at Parkinson Recreation Centre and at UBC Okanagan.

Co-op members can access the vehicles two ways.

A casual membership costs $25 a month. Whenever the driver uses a vehicle, he or she pays $2 or $4 an hour plus 40 cents per kilometre driven.

The co-op membership is $500, which is refunded when you leave OGO. The same hourly and per-kilometre charges apply.

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Cheers to Paul's Tomb

F - Aug 4, 2016 / 1:27 pm | Story: 172384 From Castanet

It's been seven years in the making, and now a locally-produced gin is ready for drinking.

Urban Distilleries is releasing a product that highlights one of Kelowna’s most celebrated locations – Paul’s Tomb.

Founder Mike Urban says he produced Paul’s Tomb Gin seven years ago; however, it didn’t have the flavour he was looking for.

“I was going after a particular target market of non-gin drinkers,” he said. “So when I made my first gin it was a little too juniper, not as floral and citrus as I wanted, so I put it aside and let it sit here for seven years.

Instead Urban decided to produce another gin geared towards the non-gin-drinker with more flower botanicals.

“That was Spirit Bear Gin and it was a runaway success for us and hit that target market,” said Urban.

Spirit Bear Gin is named after West Coast Kermode bear, B.C.’s official animal, but when Urban decided to release his new product he wanted a more local focus.

“Paul’s Tomb is just a 15-minute walk from our distillery, we explain what Paul’s Tomb is on the bottle and we put a map on the back from the distillery to Paul’s Tomb.”

Rembler Paul was a Kelowna pioneer, remembered as an eccentric man who built a large tomb for his family in the early 1900s.

While Paul’s Tomb Gin may contain more juniper notes than the Spirit Bear Gin, Urban says many are shocked to know that gin is an infused vodka.

“We just re-distill vodka with the spices to create gin, and when we get people to try it who have never tasted gin or hate gin they are very surprised to see that hey it’s not that bad it is a really nice drink.”

Paul’s Tomb Gin is a limited time product with only 48 cases produced, but Urban says if market wants it he will produce more.

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Kelowna Resident Named Student Entrepreneur National Champion

Posted from Kelowna Now May 11, 2016

A young Kelowna entrepreneur has received a very prestigious award as he has been named 2016 Student Entrepreneur National Champion.13102696 474800996057300 5929682239404164969 n

Dustin Erickson is the owner of Float Space and is a full time student at the University of British Columbia. Erickson was recently named as the national champion by the country’s largest student leadership development organization, Enactus Canada. Erickson received the title of Student Entrepreneur National Champion after beating out hundreds of other student entrepreneurs from across Canada through provincial, regional and national rounds of competition.

A panel of Canada’s top entrepreneurs and business leaders voted Dustin Erickson national champion because he truly embodies the essence of his business.

“Bringing home the Stanley Cup for student entrepreneurs today! Enactus national student entrepreneur champion 2016!” exclaimed Erickson on social media. “Floating is the most powerful tool for self-development, manifesting, thinking, creating, and evolving. Period.” 

Float Space is a four tank float centre in Kelowna that is designed to explore and enhance the act of weightless floating in total isolation from major sources of external stimulation. This empirically-based stress relief and total optimization technique is known as saltwater isolation or floatation REST (Restricted Environmental Stimuli Technique).

“Dustin Erickson has managed to turn something he truly believes in into a viable business and that is the entrepreneurial spirit which built this country,” said Enactus Canada president Nicole Almond. “We want to encourage and celebrate this in a new generation of young leaders across Canada.”

As National Champion, Erickson received a $10,000 cash prize and took home the John Dobson Cup.

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A Dragon's Nook

Posted from Castanet May 7, 2016 by Jennifer Zielinksi

Louis-Philippe Penner and his wife Ruthy are on the road to Toronto after their homemade business caught the eye of the Dragons.

The duo auditioned for the CBC show Dragons’ Den back in March and didn’t hear back right away, so thought they were out of luck.

“Out of the blue, we got a call saying, ‘We want you to come down and film – we have you in for May 15.’ So we have two weeks to prepare,” said Louis-Philippe.

Their business spawned out of a trip to the thrift store three-years-ago to buy shoes for their new baby. It was there they uncovered a pile of cashmere sweaters that would ignite Ruthy’s passion.

“She was previously a seamstress on the Island, and she thought she could repurpose the material,” Louise-Philippe explained.

The sweaters were turned into soft-soled booties for children, the item that really kick-started the business.

screen shot 2016 05 06 at 2.28.30 pm p3124936Nooks, named after their oldest daughter Anouk, are shoes and clothing for children made out of upcycled material.

“We try to use as much as possible of old materials, so we will make pants out of men’s dress shirts, and booties out sweaters and blankets,” he said. “We hand-pick all of our material, we look for 100 per cent wool material, as we really try to focus on the natural fibres,” he said.

Then the material is felted at their home in the laundry machines.

Louis-Philippe said there are nine seamstresses that work exclusively for Nooks, which he believes keeps the product consistent.

They started selling their product at the Kelowna’s farmer’s market before gaining momentum on Etsy, and Nooks are now found in 28 stores across Canada.

But they want help from the Dragons.

“We are getting to the point now where we are limited to sourcing the materials because we can only hand pick sweaters to a certain point. Sometimes there is a lack or the wool isn’t good quality.”

Louis-Philippe says they are looking for a Dragon who can help them locate material and distribute the product.

“We can still make the product sustainably here in Kelowna and still appeal to larger retailers across North America,” he said.

So until Nooks makes it out of the Den, both Louis-Philippe and Ruthy have their full-time jobs and kids to keep them on their toes.

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"Project Mermaid" Launched by Bonne Belle Photography

Okanagan mermaids working to protect local lakes

Posted from Kelowna Now May 4, 2016 by Molly Gibson Kirby

Mythical sea creatures are being used to raise awareness of water issues in the Okanagan.

In honour of Water Week in British Columbia Bonne Belle Photography is launching an environmental awareness campaign titled “Project Mermaid Okanagan”.

The focus of the campaign is to show residents beautiful art, while showing very serious environment threats found in the lakes.

“The mermaid is a gentle water guardian, watching over the lakes,” said founder Bonnie Donovan.

“She is an ambassador between us and our environment and a reminder of how precious our waters are. Everyone loves her.”

One-minute commercials and print ads of mermaids on Okanagan beaches will circulate around social media and in local magazines.

2016_Project_Mermaid_Okanagan_ from Bonne Belle Photography on Vimeo

The portraits are drawing attention to issues like invasive mussel species. Donovan said the hope is to create a coffee table book next year that will feature well-known women in the Okanagan, posing as mermaids.

Each photograph has an official Project Mermaid Okanagan stamp and soon there will be photographs at different venues in the Okanagan to raise awareness about the campaign.

Even though stories tell us that mermaids are found in salt water not fresh, Donovan laughed that fact off.

“Do you really believe there are mermaids in the ocean? The mermaid is a fictional character, much like the Ogopogo, and we can put her wherever we want! We have a dolphin statue downtown, and we don’t have dolphins in Okanagan lake, either.”

Project Mermaid is supporting the current work being done by the Okanagan Basin Water Board.


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