59. Marketing horseradish with Mark Healy

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Transcript

Eric Morse 

You're listening to the Entrepreneur Podcast from the Western Morrissette Institute for Entrepreneurship, powered by Ivey. My name is Eric Morse and I'll be the host for this episode. Mark Healy started his first entrepreneurial venture during his Ivey MBA in 2005. Through the years he has led established brands and started a variety of ventures in the marketing and consulting space. But most recently, Healy joined two other Ivey alums and acquired a horseradish brand in Norfolk County. And that right in the midst of a global pandemic. In this frank conversation recorded at the Desjardins Entrepreneurship Speaker Series, Mark shares the lessons he has learned from being an entrepreneur and working in larger firms, the challenges of running a product company, and what future trends entrepreneurs should explore in the coming years. Did you always want to be an entrepreneur? Like when did this when did this kind of come to you?

Mark Healy 

No... like how to sort of categorically... you know, part of this story? So I... by the way, two themes tonight, right? First is, who am I to give advice to anybody, right? Try a grain of salt and everything I say. And the second is two things can be true at the same time, that's going to come up over, kind of over and over and over again. So I grew up on a dirt road between two farms in the middle of nowhere and Quebec. And my mom was a teacher and my dad was an entrepreneur, and he was a, if we're honest about it, we have to be honest, today, he was a failed entrepreneur, it was a scary word. To me growing up, it spoke to poverty, and it spoke to it spoke to struggle. And it spoke to a bunch of things that were sort of negative, if I'm sort of really honest. And so it came to me later, like I'm not a born knew when I was a kid that this is what I was going to do. But the spark really was at Ivey, right? I saw all these, I felt very fortunate, I was very fortunate to get in. And I felt very fortunate about and I saw these sort of bright people doing amazing, interesting things. And the program was a huge part of, "oh, there's a process to this. And there's a discipline to this," and it's not so scary. And a few of us had an idea that we thought maybe would work and it was at a time in my life, I could sort of make that work.

Eric Morse 

And you actually started your business while in the MBA program or the germ of the idea... (at school, yes) So tell us a little bit more, what was it? What do you do

Mark Healy 

two things at the same time, right. So I, I really liked the idea of marketing at a, at a kind of strategic level, I liked the idea of consulting, because there are starts and stops to it. And I didn't really like the idea of on a plane Sunday back Thursday, which was the model at the time, there were also no specialist shops in the area at the time. And I had a couple of folks that I had really enjoyed working with and we thought we could make something of that. So the idea was born, right? We had worked on some school projects or the there was an Ivey consulting business at one point and we thought that could be maybe the gem of or the germination of something bigger. And so we started the kind of the first specialist marketing strategy consultancy in Canada at that at the time.

Eric Morse 

Yeah. Had a good run with that. All good things come to an end. But there was a good run.

Mark Healy 

Yeah, we I mean, I have lots of war stories from that. Right, good, good and bad partnerships, different partners, shotgun clauses, different brands, the whole, the whole shebang, which we tell that story, another time, but it was we were very fortunate we we caught a couple of breaks early with some clients that kind of believed in the vision we had and showed up with the time what's felt like a truckload of money. And floated the firm in a way they didn't understand they were floating us. And that allowed us to get to get better. And we we really built and did all the things that you're supposed to do that you learn in business school, and you're supposed to do as an entrepreneur, and we built right into the teeth of the Great Recession and without sort of seeing it coming. And that was that was that was one of the inflection points.

Eric Morse 

Sure, sure. But, you know, to think of, you know, still pretty a young group of men and women going out and really getting some great contracts. And you guys did go through it. But let me switch. You've had the opportunity to run your own ventures and we'll we'll get to some of the different things but you've also worked in larger organizations, similarities, differences, learnings from both

Incredibly valuable! There's no, there's no way I make decisions that I make today. I don't... 60/40 Right? Like, I think I make 60% good decisions, but I wouldn't even I wouldn't even get the number sort of that high without the experience. So when I was in a couple of stories on this when I was in school here, Ed Clark came a few times as a speaker and Ed was at TD Bank and through subprime there's a whole amazing story. He was the only guy an analyst calls it said I don't understand subprime and people like, you know, 24 year old kids and we graduated, laughed at him and said, you got him anyway, he turned out to be right. So he's, he was smart. And Ed said, you know, you got to come in and out of roles and situations in your career. In his case, it was in and out of private sector and public service, he would go to government and come back. And he said, You have to be doing that to be... to have some perspective and good, be able to make better decisions. And I have found no question coming in and out of corporate roles, over the years has given me tremendous perspective. It helps me make better decisions in my consulting practice, which is the other hat that I wear these days, I can very credibly say, I've sat in your shoes, and I've made the mistake, by the way, don't do this, or I sat in your shoes, and I started this issue, and let's talk it through. And that's that I that wouldn't be true if it was a solo, only an entrepreneurial path.

Eric Morse 

So learnings and both, both enjoyable both unenjoyable I mean, you've kind of...

The stresses or the stresses are different in both. I mean, the again, we're going to tell the truth here tonight, right? Like the biggest differences spend, the biggest difference is decisions on spending money. And you I think you always have to be asking yourself, whose money am I spending here? Right? So I'll give you an example in in the same week, okay. I sit on the board of a tech company and out of Vancouver, it's beyond our training at this stage, it's established. It's a fairly big business. But the stock prices lately has been hit. They're down a bit, they need a win. And they're staring at an acquisition. And so we're doing the diligence and debating the acquisition. Okay. The tech firm that they're thinking about buying and adding to their empire lost $5 million last year, it lost more than the year before. Okay, and what did we think... what do you think we valued that at? Let's say $30 million, somehow we valued at that at $30 million, right? In the same week in the horseradish business, we have a piece of equipment that's broken. So $110,000, which means it's 150, by the way, is three partners, Google partners, that's 50,000. But that's my money, right? Which means it's my wife's money, which 110k versus $30 million. Right? Which one of those decisions do you think gets more scrutiny? Should be the 30 million right? No. Whose money is it? I think that's key is learning to be learning to be responsible with your own money, but also in a corporate role. There's you got to be responsible, somebody else's, somebody else's.

Eric Morse 

And it is different decision, isn't it? Alright, more recently, you've joined with two other alum of the school. It's the three marks. So Mark Healy, Mark Vandenbosch, and Mark Whitmore, and you're running a horseradish business, which is exactly what I imagined when you left Ivey, 20 some years ago

Mark Healy 

Yes can see that. Yeah.

Eric Morse 

So how did that come about? And tell me about the horseradish business.

Okay, so I'm gonna tell the long version story because (and you are CEO, by the way) it's the title, right? There's three partners. It's a funny story. And it's an instructive story. So a million years ago, when I was a student here, I started a thing. And Mark Whitmore wrote, he was an industry, he was in Deloitte, very senior, he wrote the first check to support the thing. And he wrote it for two years in a row to make sure that it could get established. And it's, anyway, it's still going. And he was a great guy. And we got to know each other that way. So he was, he's a lot older than me, by the way. And I would make fun of him if he was here, but he's not. So we had always talked about, maybe there would be opportunity to work together and maybe it would be a Deloitte, maybe it will be on our own. And we made a concerted effort to go buy a business a few years ago, and it came, it went, it went nowhere. And then we really kind of picked it up. This was before COVID. And we did all of the things that you're supposed to do. We wear suits, we had a deck, we had an investment hypothesis, we had criteria, we went to see every accountant and lawyer and broker we could, we could find and we said your credentials, and we'd like to buy business. And by the way, here's what we're looking for industrial b2b services, low revenue, high margins, something we can we can make some mistakes. And we had nothing we didn't know there was no deal flow at all. And we didn't get laughed out of the room. But there was a bit of yeah, we've seen lots of guys like you and good luck. And then we decided when COVID rolled around, we would park or search we said maybe there'll be some distressed businesses later. Let's stop. And Whitmore called me in the middle of the first lockdown. Like, do you remember the first lockdown when you Weldon in your house? And if you went outside, you were gonna die like that one. And said, I found one. And I said, No, you didn't. We're not looking, remember? And he said, No, no, it's good. You should you should look at I said, What is it? He said, You have to suspend your disbelief. I said, I don't like this at all. I don't like does it fit our investment criteria? He said No, I said What are you calling me for? No, no, there's some potential here. We should look at it. Tell me what it is. He tells me what it is. I said, Mark. We're not with no permission. We're not farmers. We don't I mean agriculture background. We don't eat. It's not it's b2c, we don't know anything about retail, we don't even grocery, I'll send you the numbers. The numbers were terrible. He sent me the numbers, they were awful. And then we saw VandenBosch was a colleague of Eric's (Morse), faculty member, like, had taught me and he's got actually an agricultural background and calls us and says, Oh, maybe, you know, like, maybe we should. So we evaluate the thing and the evaluation and the diligence was extremely challenging, because it was COVID. We had one hour to go look at them, and you had to stand and they were seriously stand six feet apart, or you're gonna go jail. We had an hour to tour the facility, look at the equipment. And we looked at the numbers and all three of us came from a different perspective. Whitmore's was, look, I think there's something about the area and, and sort of the opportunity. VandenBosch looked at it from an agricultural perspective. And I literally asked everybody, I could think, can you name a horseradish brand? And nobody could? And I thought, Okay, well, maybe there's something from a marketing and brand perspective. That's the story and how we, how we bought it.

Eric Morse 

So during a pandemic, (during a pandemic), a product company. Perfect. Perfect. What have you learned about running a product company?

Mark Healy 

It's extremely challenging. (Yeah) It is extremely challenging.

Eric Morse 

It's a real, it's a there's a new step for you.

Mark Healy 

Yes. I'm not sure I'm particularly good at it to be to be honest about it. So, you know, here's a bunch of learnings. You're going to mark it with a value chain. And the value chain really matters. Right? So distribution is everything. That's kind of true. Especially in Canada, because nobody lives in Canada, relative to the geography. No one lives here. There should be 400 million people here and there are 40. So there's 40 miles between stops for anything in the country. And so fuel and labor really matter if you're, if you're in that business, if you want. A Slightly depressing, but incredibly instructive story on the retail business, you know, that business in Canada read last weekend's globe. So 10 days ago about why Kleenex, the brand decided they weren't going to stay in Canada, they retreated from the market, because they had slipped in number two and share. So it's, it's extremely challenging at a structural level. And you'll read all about the competition, and then large grocers and price and all that. So it's true to read. But it's Galen and the others get a sort of an unfair shake. It's way more structural than that. And you're you're constantly asking yourself the question, are we in our you know, in our sort of our macro space? Are we a manufacturer? Or are we a brand? And you kind of can't be both? You kind of have to, you kind of have to choose which you're going to be.

Eric Morse 

Interesting. Yeah. Why is that more,

Mark Healy 

because it's too much investment, in expertise and time and also in money. So if you're going to be, if you're going to really focus on manufacturing, you have to get very good at manufacturing, you have to very, very good at risk, and you have very good safety, and you have to be very good at audits. And you have to be very good at maintenance. And you have to be very clever about equipment acquisition and financing. And that's a completely different skill set from the customer facing side, you build a brand and you're on television, and you're on social and you're out in the market, and you're at trade shows, and straddling those two lines. I mean, I guess if you were venture backed and you had 20 million, but I don't even think that's a good decision. I think that was super over. I think

Eric Morse 

That's why when they talk about Canada, they talk about us as a logistics country, right? It's so important to what we do. You've spoken about the myth of the lone entrepreneur, how was how important has it been to have two other people, friends, fellow alums, I'm assuming it's good. But maybe we talked about the the other side as well, you know, working together at Dennis, and how would you advise anyone in the audience about looking at partners and partnerships?

Mark Healy 

You and I've spoken about this before, it's certainly the idea that anybody does everything on their own. It's ridiculous. Even if you're, even if you're a solo shop, and you start, like you have an agency, you have an accounting firm, you have a lawyer, right? You have an intermediate, somebody that you're multiple somebodies that you're working with, to get your business off the ground, you're going there, your partners, I don't care if they don't have equity. You're not succeeding with that. So that notionally is a sort of is a sort of absurd idea. And then for me, so I have a consulting practice where I'm solo now and it's been I've been long enough in that business that I know what I'm doing, maybe know what I'm doing. Think I know what I'm doing. To me, if you're kind of less than 15-20 years into a venture you you have to be you You have to be bouncing ideas off of somebody else you have to be talking decisions during Well, it is incredibly important. It's it's emotionally important because it's lonely. And you just you're gonna make, you're gonna make better decisions, if you have somebody else that you can debate the decision with, you're just aren't you. You're not gonna make as many good decisions on your own. I don't care who you are.

Eric Morse 

Yeah, some of you know, I run a program called Quantumshift. And it's, it's very successful entrepreneurs there at least 10 million, most of them are 50 to 250 million in revenue growing 20% Year over year; we've seen 800 of them. And I will say that all of them will tell you that at one time or another, they're just incredibly lonely, like, who do I talk to about my business? You know, I don't want to talk with my customer about maybe not being able to fulfill their order, I don't want to talk with my supplier about things aren't looking good, I may not be able to buy, I can't talk to my banker sometimes, because I just don't know where things are going. It can be really lonely. And having those partners or a peer group is the way to some some people get around it; to talk to and other people that have been there are going through it with you really is a huge advantage. huge advantage. I couldn't couldn't agree more with you on that one. Talk about a partner; So choosing partners, I mean, is friends the right thing to do, is it the wrong thing to do? Or does it just totally depend the academic answer

Mark Healy 

to two things, two things can be true at the same time. So there is this notion of healthy tension, healthy tension in businesses. Okay. If you think of at home, wherever home looks like for you, how healthy is the tension in your house, if there's tension? Probably not that healthy. Right? If you have business partners, and there's a lot of tension, you can label it, anyone that's not that healthy. So I think to the extent that you're that you're choosing you, you can't be at odds with it philosophically more than anything. Philosophically, yeah, you can't be at odds with your, in your worldview in the way that you come at the world. And at the same time, you can't be completely aligned. In your point of view, either you're not going to make your you're not going to debate the decisions and you're not going to get to better ones. So for that's the start of this, for me. Incredibly important. I wanted older partners, because I wanted more seasoned vets that's who have made tougher, bigger decisions than I had made. That was and that I could still learn from. And I learned from both of them every day. They're smarter than me. Whitmore is very smart. And VandenBosch is like an incredibly smart, he just makes better. He just thinks about things differently and makes better decisions. And so I think if you're, if you're at odds, it's unhealthy. But if you're coming at things orthogonally, my new word of the day orthogonally. That's very, I think it's crucial, actually. And it's been crucial for me, there's no, there's no way we get to where we've gotten, and we haven't gotten anywhere, but we'd be we'd be bankrupt in our business without our sort of divergent views.

Eric Morse 

Yeah. Yeah. Cool. Thanks. Given the career you had, is there a piece of advice or some motto that that has shaped the way you've navigated your entrepreneurial journey that you'd that you'd share?

Mark Healy 

Two, one is from you! (Great) You might be probably don't even remember that. So Eric was good enough to sit on the board of the first consulting firm that I had. And we had some early success. And then we had a couple of stumbling, we had a couple of stumbling blocks. And we realized that we needed to change a little bit not a full on pivot, but a bit of a change. And I remember us asking you, Eric, we're a and we need to be be how do we try to transition from A to B? And you said, don't just go be B. And I don't think we believed you at the time. I was very valuable advice. No one's watching. Like, you're not LeBron James and Lakers. You're not under scrutiny at all times. You just just change it. Just just literally just change it and do the thing that you think is right, and it'll be fine. And we changed it and it was not only fine, it was the right thing to do. And off we went so that's one the second is and I think from for me anyway, there's you know, as I'm approaching 50 I realized this more and more... like I'm wrong about like a lot of things. I'm like wrong about things that I was certain I was going to be right about. And in the past I think I think I got that maybe I didn't maybe I actually got it wrong. And we as... a we're wrong about a lot of things. Okay, I have two kids. I have two girls four years apart. In the four years between my kids, the science on allergens 100% flipped from don't ever feed your kid eggs to you have to feed your kid eggs. That is like millions of people right? Worldwide, who were working on a thing that got it wrong for years; we get things wrong all the time. So and I get things wrong a lot. So I think if you assume that the thing you're thinking about is wrong, that's very helpful. And go test it with other people. And it doesn't matter whether they're experts or not, go test your idea, test your hypothesis test your question, Hey, I'm thinking about this. What do you think? And it is amazing how many times somebody will who maybe has no business giving you advice, but they just they look at it differently? They'll say, no, no, you might want to think about it this way. And you think, oh, yeah, you're right. That's actually way better than what I was thinking. So there you There you go. Assume you're wrong about most things.

Eric Morse 

I would say seek seek that advice. Seek contrary opinions is the way that I would look at it, because entrepreneurship is about a bunch of hypotheses. And what you're doing is you're testing hypotheses, you need the contrarian to challenge you on what you think. And so seek it out. And I know you've actually been very, very good at that. I would also say he's right, way more than he's wrong. And I'm gonna go with that as I go to my next question. Because I think you're always looking at trends, you're looking forward. And I do think that you, you've done a really good job of capturing those things. Horseradish is an interesting one for me, but we'll get maybe back to that. What's happening in culture today are, you know, are there observations of opportunities that you see that maybe we're not entrepreneurs aren't taking full advantage of, or some areas that you know, entrepreneurs here today should be thinking of?

Mark Healy 

Cut me off whenever you want a bunch of answer go? Okay, so not macro macro trends. Cities are dead, right? COVID killed cities, cities are dead cities are hollowing out, everybody's moving to the country. downtown's are dead. No. Absurd. Like, if you look forward, 10 or 15 years, there's no way that can be true. It's never been true in human history. People have always come together, they've lived together, they've built bigger and bigger civilizations, and bigger and bigger cities, cities are gonna bounce back. So there is something there in terms of business, either if you have a lot of capital, you can just buy and sit. That's the traditional way of, but there's also kind of, there's probably a clever model there in trying to pick up the rise. As cities roar back to life, and I promise you, they're going to roll back to life much longer. While that's I'm wrong, because I'm wrong a lot.

Eric Morse 

Anybody that's ever watched Calgary a year, two years would know, yeah, this happens.

Mark Healy 

So that'd be one. The second is, it's been a personal front, it's been a very tough last 12 months with my parents who have aged extremely quickly, and emergency trips to Quebec to deal with it. And so I'm, it's on my mind a lot, right? Like, what does it look like, as the population ages and we're demographics, macro, like this population is aging, right. And I think about it a lot. I don't know how many of you been an airport in the last like two weeks or checked out at a relatively tech forward store in the last two weeks, or my parents would have, it would be impossible for them to navigate a modern airport, like they could I just they couldn't do it. They couldn't and then that's if everything is going right. And usually it's not if your flight changes, and then you got to check the app, and then you got to do the thing, I can barely do it. There's no way they could do it. And they couldn't navigate the world that and so their choices, They've retreated from it. But that is not where the world is going to go, we're gonna have for the next 30 years a wave of retirees with a ton of money, who are going to age into a very complicated, fast-paced world. And there is definitely something there for entrepreneurs, from services to products and everything in between, like, a straight service I would pay for is just like a kind of a concierge for my parents, right? Just like help them, like literally help them get through life. I don't mean care. I don't mean, clean their apartment. And that's not what I mean, I'm not a healthcare perspective. I literally like concierge service. You get smarter than me, you can imagine a much more... but that is that's a 30 year trend that is going to hold. And then the last one I got is my oldest who's 11 is she's very interested in science. And so we watch a lot and we think a lot about physics. And we think a lot about and there is if I was going to write if I could go back or if I'm advising her I would say there is there's something about sound and frequency that we're just on the edge of understanding and it will explode into a massive set of industries over the next 20 years from energy to manufacturing. There's there's something about yeah, there's something about sound and frequency.

Eric Morse 

That sounds like a long discussion. So let's hit him up later. about sound and frequency. If you were to think back Mark, what are some of the things that maybe we didn't teach in your program about entrepreneurship about being an entrepreneur or that that maybe we should, that we just hadn't thought of at that time, and we really need to be putting it in there.

Mark Healy 

So I thought a lot about a thought a lot about this question. And, you know, I will preface it with, I can't think of things to take out. So it's unfair, that if I, if I give you things, good, go ahead. And I needed all of the tools that came out of the program. And I think, I think entrepreneurship in a business school is a very good thing, because there's a certain like, there is just a tool set, you have to have, if you're going to be reasonably competent in business, you have to be able to run numbers and be able to think through risks. And you have to write some of the things that come from directly inside the entrepreneurship or in some that come from the business school. But you know, what, it's helping me more and more; history. I like I didn't take history in school, I came, I came up the engineering pathway, I thought history was a bunch of bunk. And it wasn't kind of It wasn't an interest in it wasn't core for me. And it was never, it's not part of what's really not part of the business school curriculum, like understanding your history, super valuable. And then, kind of a second time, I'll get on this thing. But some lucky I get to hang around the Perimeter Institute in Waterloo quite a bit. And the way that physicists think just about the fundamentals of the world, and how the world works from a physical... science perspective, credibly valuable to understand the kind of the big picture of how things really work. And those two lines, the what is our history, business history, what is our history as a society and what's going on in the world of fundamental sciences? Like super helpful in terms of perspective, points of view, all kinds of things.

Eric Morse 

Yeah, cool, Mark, I love that I love to have the different conversations that we're used to, you know, we get very focused in whatever curriculum we're on, and the ability to talk across that I do find hugely valuable. And I hope, you know, as we've gone across Western, we're creating more and more of those conversations with, you know, different faculties and students from every corner. And don't be afraid to have those conversations, because you never know what's going to spur an idea in the moment or later. And so I really encourage you to have those cool discussions about different things that maybe you don't talk about very often. Well, Mark, you know, maybe we'll ended on this, what advice would you have for aspiring entrepreneurs in the group, or maybe entrepreneurs, or maybe, you know, business folks that are thinking about taking a leap in the near future.

Mark Healy 

Travel. Apart from the other things that we've sort of talked about tonight, travel, go different places, and see things you're not used to seeing. If especially if you're in a city in your North American city, get, get out of North America and get into smaller, get into smaller centers where the culture is different, and the food is different, and the mode of thinking as if it's amazing how many ideas you will get, and you can't you just can't get them. You can't get them from other people where you are you have to get them. You have to get away to get them.

Eric Morse 

And so I'm gonna back that up a little bit, because it's great advice. But there's so many people out there that just go through life that go through travel, it's about keeping your eyes open and looking. How is this problem being solved here? How is it solved back home? What's the difference? Why does it happen that way? It's those kinds of questions as you travel that I think unlock so much value. For entrepreneurs. That's how they that's just how they think. It's observation. It's looking at problems looking at issues, but for a lot of us, we have to train ourselves to think that way. And I think so to step back a little bit.  The Entrepreneur Podcast is sponsored by Quantumshift 2008 alum, Connie Clerici and Closing the Gap Healthcare Group. To ensure you never miss an episode, subscribe to the show on your favorite podcast player or visit entrepreneurship.uwo.ca/podcast. Thank you so much for listening. Until next time.