Interview: Michael Hyatt
The Ivey Business Review is a student publication conceived, designed and managed by Honors Business Administration students at the Ivey Business School.
IBR: Your transition into entrepreneurship came after four years of studying science at Western University. What motivated you to make such a bold decision?
MH: I did a four-year Biochemistry degree at Western and I remember giving my fourth-year thesis presentation to my professors. At the end of it, they looked at me, stunned, and said, “Mr. Hyatt, you should go sell cars.” I realized at that point that continuing with sciences just wasn’t for me. More than that, it was a recession, so getting a job wasn’t going to be easy.
My motivation was simple — I just wanted to have my own money, my own independence. I wanted to make it in life. There was no technology community at that time, or proven methodologies on how to create a start-up. Entrepreneurship was a journey that wasn’t well accepted as a career path. I thought that if I could remotely make it as an entrepreneur, that would be more meaningful to me than working a day job.
IBR: How do you think university plays a role in the development of an entrepreneur?
MH: I think the most important thing about university is that it’s the first time in your life where you have to live on your own and make something of yourself. You learn to build relationships with other students and professors, run on a schedule, and deliver on time. I don’t believe that specific majors matter as much as the university experience at large. For many, it’s the first time you’re really an adult.
When I went to school from 1992-96, there was no Internet. From an information perspective, there was almost a bubble around the campus, and you lived in this bubble. This relative isolation prepares you because it’s your first time away from you parents. But the real world is tougher. In the real world— you sleep in, you get fired. You don’t deliver, you get fired. There’s no makeup exam in the real world. It’s just not as protected. University’s a great stepping stone, but not entirely reflective of reality.
IBR: Was there a time when you thought that you might lose it all? If so, was there anything that kept you going?
MH: There are so many times in business when things go bad. Your ability to absorb a punch is very important. When you watch the best poker players in the world, you’ll notice that they don’t get too excited when they win, but they also don’t get too disappointed when they lose. In business, you sometimes have to divorce emotion from what’s happening and just stick to the facts.
There is no problem I haven’t overcome because I’m still here and the business is still growing. However, I’d be lying to say that we haven’t had tremendous challenges over the years. That’s part of it. You get a company the size of BlueCat and you’ll realize there are not many software companies like us in Canada. That’s because it’s that hard to get here.
IBR: IHS Markit acquired your first business Dyadem in 2011. Not many people get to say that they were able to scale up a company and subsequently sell it. How did you feel about this whole experience?
MH: I felt great. I felt it was the right time. It was a terrific business, and it allowed me to build an even bigger business called BlueCat. It felt great to be able to share successes with the employees, investors, and management team that supported me throughout this journey. We were able to collectively share the returns of this sale, and that meant a lot to me.
I think there’s a misconception that entrepreneurs should stay with their businesses at all costs. Sometimes you run your course in your business and then transact it. Then, you’re enabled to start something new. That’s a very natural and even important process, because sometimes someone can take your business and move it to a place better than you can yourself. Taking some profit for yourself and leaving some profit for the next person isn’t a bad thing.
IBR: Do you think that interdependence is important in the business world?
MH: It takes a village to build a company. BlueCat, as good as it is, is not solely the product of mine and Richard Hyatt’s goals. If you look at BlueCat today, you’d say that Michael and Richard founded something wonderful, but that’s not entirely true. You’d have to acknowledge the tremendous efforts made by the current executive team that took BlueCat to the next level. I’m also very grateful for the efforts of our employees – many outwork me, which is humbling.
Another example of this dependence is when I decided to hire an external CEO to run my first company, Dyadem. I left it to him to decide what’s best for the company, and in the end, he decided that selling it was the best path.
Often times, it becomes difficult when the outgoing and current CEO have differing opinions. But, good leaders understand that when you hire others, you have to trust them to be effective. At the time, I was already building BlueCat with my brother, so I wasn’t operationally involved in Dyadem. In the end, I trusted his decision to sell and it was a fantastic move for the company. He was right.
IBR: What are some key changes you expect to see in the technology industry in the near future?
MH: We’re living in a world where exponential change is the soup du jour. I expect there to be radical change in just about everything simply because Moore’s law still applies. Computing power is still doubling every 18 months and getting a lot cheaper. Artificial Intelligence (AI) is stepping up for the first time. AI is moving from narrow intelligence towards something more general.
Our future is changing exponentially due to rapid innovation in computing power. The average person thinks that we’re seven to 10 years away from having autonomous cars. But we’re not. We’re actually a few years away, since technology is moving exponentially and not in a linear fashion. As Ray Kurzweil at Google says, and I’m paraphrasing, we think our future is like our linear past – and it’s not.
Rapid innovation will also bring about the ability to make smarter decisions. We are going to add billions of people to the Internet for the first time in the near future. There are going to be hundreds of billions of connected devices all doing something for us. This creates a tremendous amount of data, all of which will go to engines that will carve out logic and decision-making effectiveness from the vast data pool.
The core message here is that our lives are going to get much better. We’re going to get healthier, we’re going to live longer, things are going to cost a lot less. For example, if I start making trucks autonomously driven, it’s going to make things a lot cheaper, and that passes on to you, the consumer. That’s a small example, but the supply chain is going to get dramatically cheaper. The same applies to the energy needed to transport those goods. Life is going to get a lot cheaper as we bring in more intelligence. Your children are going to be doing jobs that you can’t imagine today – we simply do not know maybe even understand their job titles – yet.
I truly believe that the future is amazing, and that will be due to technology. I am very much an optimist about humankind. It’s going to be shockingly different. In 1912, we’d look at the Titanic and say that’s the world’s biggest ship, no one could ever build a ship bigger than that. That’s simply wrong, because the average cruise ship today is many times that size, but in 1912 you couldn’t have imagined it.
We have a hard time imagining the exponential future. But it’s always happened that way. You can imagine technology as evolving in an S curve. You will see innovation plateau as you reach top of the S. Then, something radical is developed and suddenly you’re on top of another S curve that you did not know existed. We’re about to undergo that massive shift in terms of AI and leveraging data through the Internet of Things. The future will be an exciting time.
IBR: There are many Ivey students who wish to start a business one day. What advice would you give them? What are some of the ways that they can better prepare for the world of entrepreneurship?
MH: First off, my most important piece of advice is to slow down and don’t feel pressured. I feel bad for this generation because there’s a tremendous and undue amount of pressure that the youth feels. You must have a very successful business by age 19 and maybe a non-profit on the side. I don’t even know how they do it. What’s funny, is that if you look at the most successful people in the world like Mark Zuckerberg, Bill Gates, and Elon Musk, they don’t get up every day to do all those things. They do one thing very well. Mark Zuckerberg clearly does one thing well — Facebook. For a very long time, Bill Gates did one thing well — Microsoft. The same goes for Elon Musk and Tesla.
The pressure that I see young students put on themselves to be successful by doing multiple things as early as possible is a recipe for disaster. I think they need to slow down, finish their education, and work at a company for a couple of years. This way, they would meet people and make relationships.
Eventually, they’ll find a real problem they want to solve. Once they find that problem, then they should start their own business.
My second piece of advice is that the most important thing you can do right now is spend an enormous amount of time building relationships. You are worth as much as your relationships. You should give, you should donate, you should push, you should console, you should get involved with your relationships. You should pay for lunch, pay for coffee, connect people, give into your relationships. Invest time and money into the people you want to spend time with. That is the most important thing you can do when you’re young.
IBR: How do you personally define success, in your personal careers and the entrepreneurial ventures you have taken part in?
MH: I think success should have very individual definitions based on the person you ask this question to. Money is only one dimension. I was a millionaire by 25, I lived in Richmond Hill, I had my own house, but I was unhappy. For a long time, I couldn’t find my way out of this unhappiness. Money doesn’t buy you happiness, but it does make life a lot easier. Money helps you out tremendously, but only in some respects.
Here’s my advice: make money, but don’t value it. The minute you start placing substantial value on accumulating money, you’re in the wrong place psychologically. Success shouldn’t be about the money you gain, but the problems you’re able to solve and the personal goals you’re able to achieve.
IBR: Being involved with both the Next Gen Den, and Rotman’s Creative Destruction Lab, it seems like you judge a lot of promising ventures. What do you typically look for in a venture that you’ve typically seen results and success?
MH: I look for people who I can work with. Typically, that comes down to finding the entrepreneurs who have ambition, but also flexibility. Most of the time, the company that they’re starting out with is not going to be the company they’re ending with. All I’m doing is looking very carefully and asking myself, can I work with this person? Are they ambitious? Can they pivot if they have to? I have to like the general direction of the company, but the real question I have to ask when partnering with new ventures is whether or not I can work with them.
IBR: What would you like your career legacy to ultimately be?
MH: I just want to be known as the guy who built something from nothing and made a difference for our country. I truly believe that Canada is the greatest place in the world to live in and I care very much about our country and building companies here. That’s why I spend a lot of time speaking across the country about entrepreneurship. I believe that we need to think very carefully about being more than just an oil and manufacturing country. We need to think about shifting our focus to becoming more involved with building technology companies that support all industries. Those new jobs will have high wages and that helps everyone. We’re a relatively small population on a very big landmass and we’re very spread out. That’s a big disadvantage, but our advantage could come from leveraging the technology culture that has developed to create value for our country.
