It’s a Tuesday night, late in October. Men and women in tailored pants, trim jackets and collared shirts shuffle through a doorway cut into the brick facade of the roundhouse. Sheltered by the clay-coloured walls and corrugated metal roof, they walk past racks of overcoats and umbrellas, through another doorway, and into a wide room. Black A-frame chairs face the far wall, which is obstructed by a trio of projection screens. Each reads “JOLT demo day.” The chairs are sorted into neat arches, interrupted only by wooden pillars dividing the room neatly into thirds. The musty smell of hops permeates the dimly-lit room, beating back the odour of permanent markers and overpowering the chemical reek of the glue on the back of the printed name tags. Green been bottles spin around the Steam Whistle assembly line. The clockwork machines are nearly rivalled in speed by the flurry of business cards flying from hand to hand. People mill about like curious schoolchildren, anxiously waiting for something to happen.
Away from the kerfuffle, Lindsay Goodchild, her business partner Dessy Daskalov, and numerous other young entrepreneurs run through their pitches one last time. It is the culmination of weeks of planning, developing, building, and pitching. The six teams who participated in the MaRS Discovery District JOLT start-up accelerator will stand on the raised wooden platform and tell the assembled what their business is, how it works, and why it will be successful. Real entrepreneurs, with real ideas, pitching for real investors, for real money to run a real business.
Goodchild is the CEO of Greengage Mobile. Greengage is a mobile application and a web based tool that allows companies to engage their employees in and track sustainability initiatives. Corporate social responsibility (CSR) is a growing field, with more companies reporting on their efforts to be socially and environmentally responsible. The software sends tips to mobile users, tracks completed activities, and generates reports corporations can use. Employees are rewarded with points and badges for their contributions towards the company’s CSR goal. ING Direct Canada and Ryerson University already use the software. Goodchild is hoping to expand the user-base and attract investors.
The business grew out of Goodchild’s experiences in the CSR field. After becoming one of the first graduates from Ryerson’s post-graduate sustainability program, Goodchild was hired as a sustainability consultant. “I found that organizations all needed a new tool to help them track and manage their sustainability initiatives,” she says. “It was such a common problem and there wasn’t any good solutions.” Since she couldn’t find the product she needed, Goodchild decided to try to create one.
About a year ago, Goodchild and her infantile company joined Ryerson’s Digital Media Zone. “I didn’t know anything about business,” she says. “I had to start with googling ‘how to write a business plan’ so I could get into the DMZ.”
The Ryerson Digital Media Zone is an office environment providing start-up capital and guidance to young entrepreneurs. It is considered an incubator – a place young businesses can hatch and grow. The DMZ provides new entrepreneurs with business plan counselling, mentoring, workshops, networking and a chance to show off their products. Many companies have gone through the DMZ, some evolving into larger, successful businesses. Flybits, the company behind the development of the GO Transit mobile application grew from the DMZ’s research and development team. The successful photo-sharing website 500px graduated from the zone in 2011. Venngage was a spin-off from the DMZ company visualize.me.
After some time at the DMZ, Greengage and Venngage both got accepted into the JOLT program at the MaRS discovery district. The JOLT experience differs from the DMZ. JOLT is more hand on, actively bringing in mentors and guest speakers to guide entrepreneurs through the oft difficult to navigate roadmap to building a successful business. “It’s almost like start-up school,” says Goodchild. “Every day you have classes and seminars – you feel like you’re in an MBA class or something.” Each start up is assigned two mentors, an investor and a successful entrepreneur. Jolt programs run four months, and companies go from concept to development to launch in that time. The program culminates in a product launch day at the Roundhouse. After the four-month program, the companies are required to move out of their MaRS discovery district office space. The DMZ is more like a large community of entrepreneurs, and companies can stay as long as they deem necessary to develop their product. It also provides mentorship and seminars, but the DMZ takes a more hands-off approach. Both Venngage and Greengage mobile will be returning to their office spaces in the DMZ when their run at Jolt is over.
JOLT and the DMZ are valuable resources for early-stage entrepreneurs, as the first few months and years of a new business are the most important, and some of the hardest to navigate. When Goodchild started at the DMZ, she was surprised to learn that they didn’t provide any tech developers. She had to find, in her words, “tech people” to help her develop the software. “I couldn’t find my ‘perfect’ technical partner,” she says. “It’s a big deal when you start a business with someone else; you want to find the right person.” She chose to outsource work to a Toronto development company called The Working Group. The Working Group liked the project and became some of the first investors in Greengage mobile. Daskolov was a developer at the Working Group, and she was assigned to the project. “Her and I just kinda connected,” says Goodchild. “We started hanging out, going for beer. She did her thesis on sustainability and so did I, so we had a lot to talk about. She told me she was thinking about having a start-up, and I was like ‘ah, I need someone who is technical and wants to have a start-up’.” Goodchild and Daskolov had similar ideas on where to take the business. It was time for Goodchild to make her move. “So eventually I got up the courage to ask her if she would be my co-founder and she said yes so, happily ever after,” says Goodchild through a chuckle. “So it’s like a dating story. I had to take her out to dinner and beer multiple times before I got the courage. I’m glad I did, it’s working out very well.”
Venngage mobile, on the other hand, grew out of anvisualize.me, an award-winning company. Visualize turned the information on resumes into pictorial representations of the information. The product gained 200,000 users worldwide. Their clients pushed them for infographics that went beyond just resumes, so the company evolved. They turned visualize.me into Venngage, software that, in 15 minutes, can turn raw data into an infographic. Companies can use the infographic to present marketing and sales data. Companies like Facebook, MaRS, and TheScore use the Beta version of Venngage.
Thanks to the experience they had gained at the DMZ, Venngage and Greengage were further along than some of the other companies at JOLT. According to Eugene Woo, the CEO of Venngage, this experience meant both companies had already started to discover what does and doesn’t appeal to customers. “A lot of entrepreneurs think their first idea will work. But you go through many iterations until you find the one that works,” says Woo. Venngage had already gone through the process of finding a product, pivoting, redesigning, building up and tearing down their product to get to the one people want. “We’re on our third or fourth version of our product. I would be shocked if Greengage didn’t go through the same thing.”
One thing Woo and Goodchild have discovered is that turning that small business into a big, successful company is extremely difficult. The investors and mentors at the demo day had one message in common – only about one in every ten start-ups will make it big. According to Matt Saunders, a business development advisor at the Digital Media Zone, companies face many barriers to growth. They have to find a product or service people are willing to buy for a healthy margin. They have to find great employees to help them build the business. They have to figure out distribution, and they have to get customers to use the new product.
Saunders says that the companies who do manage to get past those barriers are key job-creators. Small and medium-sized drive innovation and create jobs. The success of small businesses is essential to the success of the economy. “Skilled mentorship as you navigate these issues is essential,” he says. Greengage’s mentor, Ryan Poissant, had a huge impact on their business. “One of the things that I think is so important for any start-up is having a superhero mentor,” Goodchild says, “and he was that for us.”
Since the craziness of demo day, Greengage has had a lot of interest from investors and potential clients. They have three investor meetings, and then they will fly down to San Francisco to pitch their product to experts, investors and clients in Silicon Valley.
Venngage is doing well too. Investors were impressed by their demo. “I thought theirs was way ahead in terms of depth and ability,” says Ken Nickerson of iBinary LLC. The software is hard to replicate and it fits a need in the market – the data visualization software out there is hard to use and can be confusing to all but the most experienced users. Nickerson loves that Venngage creates infographics anyone can understand. “There’s not a lot not to like,” he says. “I’d do a meeting with them, and I’d invest.”
Despite the investor interest, however, Venngage is not quite ready to raise money. They want to continue to improve their software using the feedback they have already been given. They want to create a product any size company at any stage of development can use. They are talking to potential clients, but won’t seek investors until next year.
Goodchild and Woo have a long way to go before they run big businesses. Few start-ups ever make it to that stage. Despite all the challenges, one factor can determine who makes it big and who is forgotten. “The people behind the business set it apart,” Saunders says. “It’s all about the people and their passion, dedication, focus to succeed under extreme circumstances. Those who do not accept failure as an option will ultimately be successful.”