By Jane MacDougall - Monday, January 21, 2013 - 0 Comments
Behind the acerbic television persona resides the sensibilities of the artist
You know Kevin O’Leary, right? He’s the gelid-hearted executioner on CBC’s Dragon’s Den and ABC’s Shark Tank. On The Lang and O’Leary Exchange, CBC’s daily business show, he displays the nuance and subtlety of bleach. His brand of blunt financial counsel has earned him both an audience and a reputation. This month he floats more of his typically mordant advice in Cold Hard Truth: Men, Women and Money—a primer on how to stay solvent, and thereby, he says, happy. But there is another Kevin O’Leary. Behind his acerbic television persona resides the tender sensibilities of the artist. Every thorn has its rose.
Much in O’Leary’s life conspired to lead him to his true passion in life: photography. His early years taught him his watchful eye. As a child he witnessed his beloved mother stagger under the emotional and financial problems of a broken marriage. Life improved, but grew complicated when his mom married an economist with the UN’s International Labour Organization. He was installed and removed from an array of exotic locations as he moved with his parents from various UN postings. Constant relocation defined him as an outsider, an observer. Dyslexia confounded him and he relied increasingly on images.
In 1970, as a student at Nepean High School in Ottawa, O’Leary bought himself a camera, a Soviet Zenit-E, and joined the photography club, becoming instantly captivated by the alchemy of the darkroom. He still has the photos he developed himself from that first roll of film and says that he couldn’t do any better today. Continue…
By Blog of Lists - Saturday, December 22, 2012 at 9:30 AM - 0 Comments
“Every year we see hundreds of pitches, and probably one in 10 is a good business idea, so nine others make no sense for whatever reason,” says Kevin O’Leary, the Dragon’s Den outspoken dragon. “Sometimes you go into the most insane space.”
1. Bottled Intentions: The idea was to sell bottles of water with inspirational words written on them. When O’Leary questioned the sanity of the entrepre- neur making the pitch, she asked him, “Are you suggesting that I’m a nutbar?” “Yes,” O’Leary replied.
By Davide Berretta - Thursday, November 17, 2011 at 10:13 AM - 3 Comments
Nikki Pope says she came up with the idea after spending time with her 11 brothers and sisters’ families. She couldn’t help but notice “the huge buildup in everyone’s houses of toys that the kids were no longer playing with, because they were growing so quickly,” she said.
The idea was to start Toygaroo, a toy rental subscription company that works pretty much like Netflix. Instead of creating a movie queue, parents select a number of toys online, along with a subscription plan, and Toygaroo delivers a box containing, for example, four sanitized toys once a month for about US$35.
If that sounds a bit pricey, there’s also Colorado-based BabyPlays, which offers slightly cheaper subscription rates.
In the States, similar companies renting baby clothes and children’s books are also taking off, as online services penetrate deeper and deeper into the lucrative children market. But the Netflix-for-toddlers model may soon be coming north of the border as well.
Pope said she is seeing a large number of inquiries from Canadian parents, enough to warrant an expansion to Canada, perhaps as early as 2012. And Canadian investors are already pouring money into it. When Toygaroo was featured in a startup reality show last March, it raised US$200,000 in investment, including from Canadian mogul Kevin O’Leary.
In the meantime, two Canadian moms who have been renting toys online for over a year, are also getting ready to offer the subscription option. Operating the self-funded Toys Trunk out of Milton, Ontario, Carolina Rey and Katia Parada rent individual toys, such as the “bilingual learning table” and “jump smart trampoline” for prices mostly hovering around $7 for two weeks and $10 for four weeks.
Rey, a former industrial engineer with two children, says Toys Trunk wants to go the way of Toygaroo and Babyplays soon, but data on their 300 customers tells them most parents want a quicker turnaround than those offered down south. “The funny thing is that we noticed that our moms like to change the toys every two weeks,” says Rey. Especially in the case of city dwellers, she says, certain toys are so large that, “people.. want to try them and take them home but they take up so much room so they just want them for a couple of weeks.”
For now, Toys Trunk is serving Milton, Oakville, Georgetown, Mississauga, Campbellville and Burlington. “The dream,” says Rey, “is to have it national.”
You can follow Davide Berretta on twitter at http://twitter.com/#!/daveeday
By macleans.ca - Monday, October 17, 2011 at 8:10 AM - 15 Comments
‘He looked at me for 10 seconds. And then he went absolutely nuts’
In the mid-’80s, if you’ll recall, there was a massive rivalry between Bill Gates and Steve Jobs. Gates decided early on that he would license his operating system to every manufacturer who wanted it. In a matter of years he got 97 per cent of the PC market. On the other hand, Jobs said, “I’m never going to license the Mac operating system to anybody. I am going to control the hardware and the software and package it to consumers.” He lost huge. He ended up with two per cent of the market.
At the time, The Learning Company was the largest provider of educational software. I’m the guy that’s providing 80 per cent of the market for reading and math software in schools and for consumers, with brands like Reader Rabbit, Carmen Sandiego and Oregon Trail. It cost about $500,000 a title to develop software for Windows and $500,000 for Mac. It was very easy for me to find my Windows user—97 per cent of people who have a computer can use the software. But my cost of acquiring the Mac customer keeps going up the more share Jobs loses in the market. I’m losing about $50 million a year doing that and my board is squeezing my head saying, “What the hell are we supporting Mac for?”
We were working closely with teams at Apple and I finally said, “I’ve got to go see the big guy. We can’t go on like this.” I planned to ask him for $50 million, but was willing to accept $12 million [to continue making software for Mac]. I got there and sat down at a boardroom table; there were five or six of us on each side. It started with the pleasantries of the product management teams and then probably half an hour into it, Jobs walked in and the whole room shut down. It went silent. Nobody would say anything when Steve was in the room. He was the king.
By Colin Campbell - Wednesday, October 5, 2011 at 10:50 AM - 2 Comments
The ‘Dragon’s Den’ star on his unconventional childhood and what Steve Jobs is really like
Before becoming one of the star investors on CBC’s Dragons’ Den and ABC’s Shark Tank, Kevin O’Leary founded the software firm SoftKey, which later became The Learning Company and merged with Mattel in a deal worth nearly $4 billion. He now heads the investment firm O’Leary Funds and also co-hosts CBC’s The Lang & O’Leary Exchange. His new memoir Cold Hard Truth hit shelves last week.
Q: You offer a lot of lessons in your book about how to succeed in business. Can entrepreneurialism be taught?
A: I actually think being an entrepreneur is a state of mind. If you’re going to be an entrepreneur, my thesis is that you have to sacrifice everything for some period in your life to be successful. You have to be myopic and completely focused and unbalanced in every way. Once you achieve success, you’re free to do whatever you like.
Q: You write about being steered into business by your stepfather and mother.
A: Well, my mom’s attitude was, you’re going to find your own path, and life is serendipitous. She wasn’t as rigorous and hardcore as my dad, who looked at me one day and said, “You’re going to amount to nothing. All you do is party and you want to be a photographer. That’s the most competitive industry on Earth. You’re not that good.” The guy was giving me the truth: you should go back to school and at least get some tools.
Q: There are professional photographers. You could have pursued that.
A: I wanted to do that. I wanted to go to Ryerson. His thesis was: what’s your competitive advantage? What’s your difference? I’ve met with and worked with many photographers now, and I realize that it’s a brutally competitive market and they are really, really good. I honestly don’t think that I have that.
Q: This was your stepdad. Your biological father you describe as being a real salesman. Do you think you inherited that from him?
A: I do. I noticed the other day in a photo of him with his arms stretched in a position I do a lot; it looks just like I do. He died when I was seven. But I remember him. He was a classic Irish partier. A very kind man but also a real renegade.
Q: He lived hard?
A: Very hard. It’s what those Irish guys did. My mother divorced him right before he died and I think he died with a broken heart.
Q: What do you think he would have made of Dragons’ Den?
A: He would have been proud of me. He really missed a lot of life. I think he drank himself to death. It’s something I’m very cognizant of.
I was driving a couple of years ago and Peter Munk, the chairman of Barrick Gold, calls me and says, “Did you know that I came over on a boat with your father from Ireland? He was my roommate.”
Q: Get out of here.
A: No I’m serious. He said, “I just wanted to call you and let you know that he was a great guy.” It was a remarkable moment.
Q: What about your mother? Did she have a chance to see any early episodes of you on television?
A: She did and she was always fascinated by television. She actually enjoyed Lang & O’Leary more than anything. She really respected Amanda.
Q: Your mom factors heavily in your book . . .
A: She was an amazing woman and went through a lot of hardship, but also gave me tremendous guidance and support. She had an investment philosophy that I didn’t appreciate then but I do now. She said, never invest in anything that doesn’t have yield. When she died three years ago, I was executor of her estate and I realized she had every single dime she’d ever made.
Q: That’s still your investment philosophy today.
A: And it works! It really works.
Q: She was a working mom too, right?
A: A working mom. Her father owned [a clothing factory] but his philosophy was that the daughters all had to work on the sewing line. She was the boss’s daughter but not treated differently than anybody else. That’s how I treat my kids, too. When I fly over to see my dad in Geneva, my son has to sit in the back of the bus because I say to him, you have no money. You can’t afford to sit in first class. It’s a good lesson. He gets it. It makes him mad.
Q: Your mom later became the CEO of the family company.
A: It was tough. I had a German nanny. My dad was gone. I had dyslexia.
Q: You write in your book, “Money is the lifeblood of family.” Explain that.
A: Unfortunately it’s the truth. You can say family can be held together by love, but the truth is if there’s no capital there you get into a very bad place. Money puts tremendous pressures on relationships if you don’t have any.
Q: But your parents would have loved you if they were broke and living in a shack, right?
A: Yeah, but you know . . . money tears families apart for lack of, and for too much. It’s a very powerful force and you have to understand it and respect it.
Q: People would probably be surprised to hear about your whirlwind childhood—living in Cambodia, where your stepdad worked for the UN, going to military college in Quebec. Was that hard?
A: It was hard. I think back and think I missed something. But at the same time it gave me an appreciation of the world. I own real estate in Cambodia because I know it’s a great place for real estate. No one else knows—but I lived there for two years and I’ve been back.
Q: What did you learn at military college?
A: The discipline of getting up at 4:30 in the morning.
Q: Do you still do that?
A: I do. I get up between 4:30 and 6:30 every day.
Q: Were you a popular kid?
A: I had good friends. What’s happened to me over time is my best friends are the ones I’ve been to war with in business. I make friends inside a company and I stay friends with them the rest of my life.
Q: In one of your early endeavours you worked in TV production, including on Don Cherry’s Grapevine, a half-hour interview show. What was that like?
A: I owned that format. I owned Special Event Television with two partners. The first time I made money was selling Don Cherry’s Grapevine to his son.
Q: Do you channel Don Cherry when you’re on TV now?
A: I really respect Don. When you go on television it’s because you’re trying to create something people watch. He’s very flamboyant, entertaining and I think he taught me a lot about that.
Q: On TV you have a reputation as being the mean guy. You have a story about one man who came up to you in an airport washroom after seeing you on Dragons’ Den and called you an asshole. You’ve said this kind of stuff doesn’t bother you.
A: It doesn’t bother me at all.
Q: It’s hard to believe. Everybody wants to be liked.
A: Here’s why I know I’m right about this. The reason he said that is that I’m simply telling the truth. The one thing about money is you have to tell the truth about it. It’s the only metric in life where there’s no grey. You either make money or you lose money.
Q: I think you’ve described telling someone their idea stinks as “exhilarating.”
A: Because we’ve gone through this journey together; we’ve explored an idea and we’ve come to the right conclusion: it’s stupid. That’s a good outcome. I’m not trying to make friends, I’m trying to make money. My whole theme is just tell the truth.
Q: Let’s talk about The Learning Company, which you sold to Mattel in what turned out to be an epically bad merger.
A: You know, what’s interesting is the company is back [under new ownership] with all the same brands and doing very well. I think Mattel squandered a fantastic asset. One of the big motivations in writing this book was to set right what actually happened after they acquired the company. In my mind I’ve cleared the record.
Q: Obviously you’ve heard all the criticism: that TLC wasn’t profitable, that Mattel was somehow deceived.
A: Of course, if any of that were true it would have come out in the litigation. None of it was. They had forensic accountants tear our books apart for two years.
Q: You talk about how a culture clash between your software firm and a big bureaucratic toy maker ruined what could have been a good deal. The failure must have really bothered you.
A: It made me crazy. I was out of my mind unhappy.
Q: You and the CEO of Mattel, Jill Barad, both lost your jobs.
A: Well, I mean, I wasn’t happy being an employee anyway. I had a three-year non-compete. It was the most miserable time of my life. I was making the largest salary I had ever made and I wasn’t allowed to work.
Q: You once managed to get a meeting with Steve Jobs, where you asked him to pay TLC to keep carrying Mac-compatible software. What was he like?
A: He was so abusive! Toughest guy I ever met. We were in the boardroom at Apple and he went into a diatribe like I had never heard before. But we eventually did a lot of business with Apple. He’s a tough guy. Maybe that’s why it works. And hey, there’s an asshole!
By Nicholas Köhler - Monday, March 14, 2011 at 10:00 AM - 19 Comments
On dragons who can’t make deals, Kevin O’Leary and what he thinks of ‘The Bachelorette’
Brett Wilson, the Calgary-based investment banker and philanthropist who came to national prominence as the “dragon with a heart” on the highly rated CBC reality television show Dragon’s Den, is now no dragon at all. He and the CBC parted ways following difficult contract negotiations in which he says the broadcaster insisted he never mention his association with the CBC or the show during public appearances or in promoting his own work. Wilson had been the most active investor on the show, which sees entrepreneurs seeking capital pitch their ideas before a panel of “dragons.”
Q: Your departure from the show has garnered a good deal of attention—why do you think people care so much?
A: First of all I was surprised that CBC issued a press release saying I was leaving. I thought I would just sort of fade into obscurity. I happened to be getting on a plane when they issued that release, so I didn’t have a chance to see it for four or five hours. In the meantime there were an awful lot of phone calls to my office asking why, how come? I think there’s an irony in the eyes of some viewers—or some media—that a dragon couldn’t get a deal negotiated for his own purposes, or his own contract, if you will. And I suspect there is.
Q: You’ve challenged the CBC to dole out what you’ve called “constructive criticism as opposed to abuse” on the show. What prompted you to make that challenge?
A: I want it to respect the intelligence of the viewing community—you know, there isn’t a business school in the country that isn’t paying attention to this show. I was the lead deal-making dragon. I don’t know how many deals the other dragons have actually done or closed, but I managed to get 60 done on the show, and we’ve papered 30, and 31 should be done in the next couple weeks. That’s where my own fan base says, “Thank you for showing us how to do deals.” It’s easy to say, “No,” it takes no courage, no brains and no wallet to criticize. Criticism comes free. Action comes at some cost, and I’ve been pretty active. Will the 30 investments I’ve made all work out? Absolutely not. I suspect I’ll write off four or five in the next year because they’re stumbling. But there’s four or five that could become iconic brands in Canada because of the power of the entrepreneur. Any one of those top-five investments will pay for all 30. So I take a portfolio approach.
Q: Listening to you outline your approach—that a handful of your investments will likely pay for those that fail—is “dragon with a heart”
less about generosity or emotion than it is a sound approach to investing?
A: I invest in people. I get value from helping people, and I get value on my money. So both of those make sense. I choose partners based on the people I want to do business with because business plans evolve—we stumble, we trip, we jump, we leap, we go to different plateaus—but the people in whom we’ve invested are still the people. My partners are a core of my success. That’s been my success over the years. In the investing world I do get value for helping people, but I don’t give up financial return to get that.
Q: Some argue you’ve been Kevin O’Leary’s foil, that the CBC built the show on a Kevin-versus-Brett narrative. Were you ever coached into participating in that kind of dynamic?
A: Just the opposite. When I first tried out for the show, the commentary from CBC was that I wasn’t mean enough. I said, “Look, if it means being a prick, I’m not interested. If it means being tough when you need to be tough, check my credentials, my success, my partners, and my life, and just know I can get there.” I think in the eyes of some of the people who were putting the show together, they thought the Kevin-esque approach was typical—that he was your normal, tough-as-nails, chew-’em-up, spit-’em-out businessman. I would suggest just the opposite. I run into a lot of people who take a very hands-on, people-centric approach to investing. It’s not that Kevin’s wrong and Brett’s right. It’s that the range exists.
Q: What’s called reality television, or “factual entertainment,” as the CBC prefers to call it, are masterpieces of editing.
A: I call it “contrived reality,” because it is orchestrated. Now, when I say “orchestrated,” the dragons were never coached, we were never told what to say. To put credit where it’s due, CBC’s done a fabulous job with this format. I’m told both inside and outside CBC that CBC’s version of Dragon’s Den is used as the gold standard globally against the other 16 or 18 or 20 that exist around the world. I’m talking about how to put the icing on the cake, here, not saying throw away the cake.
Q: But it must be an odd sensation to watch how your exchanges are shaped in the cutting room. What’s that experience been like?
A: In the early seasons it was frustrating. One of my favourite questions I ask every entrepreneur I invest in is, “How much time and how much money have you got invested in this idea?” There’s no wrong answer, but I do need to know. Have you been working on it for 10 years and you’re beating a dead horse? Or did this just come to you a week ago and you’ve got daddy’s money behind you? Or is this your heart and soul? I don’t think that question has ever made it to air. CBC is looking for that quick repartee, what you would call the juicy moment. I know that’s what they’re chasing in the editing room, and I’m completely okay with that. They own the mouse that does the cutting.
Q: But do they make the exchanges sharper than they really are?
A: I would suggest to you that they edit out some of the heated exchanges. It doesn’t get nasty but sometimes it might be a little bit too snippy, a little bit too rude.
Q: What’s the best advice you’ve given?
A: People who come on the show overestimate the share of market they can achieve. First they guesstimate the market—let’s say $1 billion in widgets can be sold next year and they say, “Well, jeez, I can get one per cent of that market, therefore I can make $10 million.” My response is, it might cost you $50 million to pursue that slice of the market, and you don’t have that money. I don’t care if you can make it—if you can’t sell it, there’s no point. Understanding your market—who will buy it and who will buy it at a profitable price—is key.
Q: You’ve done 60 deals on the show and about 30 have led to cheques being written. What happens to those 30 that don’t work?
A: Of those 30, I would say 10 were people who didn’t ultimately want to do a deal—they weren’t ready. There were another 10 where due diligence didn’t hold up. In one case someone on the show said, “I have a signed memorandum of understanding,” which turned out was an email expressing interest in a deal. There’s a big gap. I would say the other 10 would be ones where, when we did the homework, we just weren’t comfortable. In one case—again, names don’t matter—I just became uncomfortable with the entrepreneur. I didn’t like the way my people were treated. So I pulled the pin and said, “I will not tolerate that kind of abuse,” if you want to call it that, “of my own people.” You know—kissing me and kicking my staff. That’s not a relationship that’s a basis for anything. Not every marriage has to be consummated.
Q: Some of the pitches can be heartbreaking. I remember seeing an engineer who’d designed a device that would open Freezies for his kid, and he’d sunk $250,000 of his money into it. And he was turned away on the show with five outs. I’m not sure if you remember the case.
A: Oh, I remember it very, very well. He had an amazing product, it was beautifully engineered. He could make it—but he couldn’t sell enough of them to justify his investment. It was one of those sad moments for me where I’m looking, going, “You know what? This isn’t a product that the market needs.” On the flip side, it’s that passion, that sometimes blind belief in oneself, that allows some businesses and products to move forward.
Q: I also watched as you listened to 18-year-old Ben Gulak pitch his motorized unicycle, the Uno, and you were clearly enchanted.
A: Here was a kid who I looked at and thought—you know what? Even if Uno doesn’t work exactly as it’s been invented, I want to be this guy’s go-to, his brain trust, I want to be his wallet for the next idea. Because coming out of a kid who’s 18, who’s built this Uno literally out of scrap parts in his family garage, who’s been accepted to MIT, that’s a kid I wouldn’t mind investing in. You know, the evaluations that were applied to the original round of financing for Google and Yahoo and eBay and Amazon and Facebook probably made no sense either.
Q: You’ve hinted that a television show around philanthropy could be in your future. I think it’s fair to say the received wisdom goes that people like watching greed, or the consequences of greed. Can you make compelling TV out of philanthropy?
A: Time will tell. I would entertain putting myself in front of the camera again if it was to celebrate entrepreneurship or celebrate philanthropy. I happen to be one of those who still thinks a good-news television network makes sense. I understand that “if it bleeds, it leads.” But I also think there’s an awful lot of people who are tired of the irrelevance. Let’s be serious here—The Bachelorette shows are completely irrelevant. They make interesting TV, but there’s no learning, no education, no nothing other than a fairly low-brow way of spending an hour watching some guy bouncing from bed to bed.