BDC CEO Michael Denham. Photo: Neil Mota
Even before he took over as president and CEO of the Business Development Bank of Canada in August 2015, Michael Denham was a leading voice on the issues facing Canadian companies today.
Denham served as Accenture’s senior managing partner in this country from 2007 to 2011. He wrote on, and advocated for, issues ranging from labour shortages to global expansion. Now, he leads a team of 2,000 people who provide financing, consulting and venture capital to entrepreneurs across Canada. A crown corporation, the BDC earned close to $ 500 million in net income last year.
In this exclusive interview with Canadian Business Editor-in-Chief James Cowan, Denham explains about what Canada’s entrepreneurs need to thrive in the global economy today—and how he plans to help.
You joined the Business Development Bank of Canada in August, after a long career working in the private sector: you were an executive at Bombardier, and were president of Accenture and AquaTerra. What appealed to you about the BDC job?
Frankly, what attracted me to the BDC was its importance in Canada. The BDC is the only financial institution that focuses on entrepreneurs, and small- and medium-size companies. I view these as the backbone of our economy. When I first joined the corporation, I attended the PROFIT 500 event, which was a room full of very, very successful entrepreneurs. And one of the guys there put his arm around me when I arrived and took a selfie. Not because he knew me, but because the BDC had backed him five or six years ago, and now he’s the CEO of this incredibly successful, rapidly growing company.
Your predecessor at the BDC, Jean-René Halde, led the organization for a decade with a strong track record. When you took over, was your goal to maintain continuity with his tenure, or did you want to create your own mandate?
You’re right. Jean-René was a very successful leader, so my leadership role is to maintain the momentum I inherited. But there are a number of things I’d like to really accelerate over my tenure.
The first is making it as easy as possible for entrepreneurs to work with us. We’re going to be accelerating our deployment of technology to make a first-rate online banking platform, and we plan to add 20-odd business centres across the country. The second thing we’re going to do is increase support for entrepreneurs and small businesses as they expand internationally.
In the past, you’ve been vocal about the need for Canadian businesses to expand overseas. What practical strategies do those businesses need to succeed on the international stage?
The first thing you need to do is get the house in order. When you’re entering a new market, [customers are] not just waiting for you to get there. There’s going to be some other company—be it domestic or foreign—there already. You’ve got to out-compete them to win market share. So you need to be very good at what you do.
Then you need to focus and pick your markets. And from there—and this is something we help our clients with—you want to speak with Export Development Canada, which can help connect with the right resources.
Do you think Canadian companies avoid international expansion because they think it’s too complex? Or are they just scared?
I actually met with one of our clients last week in Toronto. He runs a company that packages non-prescription pharmaceuticals. He said, “With the low Canadian dollar, there are lots of opportunities for me in India, in the U.S. and in Asia. But frankly, it’s just too hard, and I don’t know how to go about doing it.” I think that represents the attitude of a lot of our successful clients. And what we can do for them is simplify the task of connecting to export markets.
Are there particular countries or regions that companies should be considering right now? It seems like there are trends. China was popular, and then South America…
Right. My personal view is the U.S. does still represent the best place for most entrepreneurs to start, given the choppier growth rates in places like China, Brazil and South Africa right now. It’s always better to be diversified, but for a client that’s just now contemplating whether to start exporting, I would recommend the U.S.
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