'Knowledge angels' aim to answer prayers

Queen's University is creating a network of proven corporate players to help early-stage companies

2000-10-03 - DANIEL McHARDIE
The Globe and Mail

Paul Gilbert is a seasoned businessman, but earlier this year he was looking for knowledge.

Mr. Gilbert, chief executive officer of FTT Ltd., a materials handling company in Toronto, faced the challenge of pushing his business into the United States while expanding it at a rate of 40 per cent a year. So he contacted the new Centre for Enterprise Development at Queen's University in Kingston, seeking savvy people to help him with the expansion plans.

The centre's managing director Niraj Bhargava and his colleagues were able to track down the expertise Mr. Gilbert needed in a week. That helped cement a project for the Queen's centre -- to create a network of "knowledge angels," proven corporate players who could fly in and aid an early-stage company having difficulties or needing help in an unfamiliar area.

In the New Economy, angels usually are private investors who provide start-up financing. Now, Queen's is broadening the concept to people with expertise. Recently, it brought 60 of its knowledge angels together for a weekend of networking and planning as the centre prepared to introduce the program.

The conference was a chance for the advisers to get to know each other, and learn how the university planned to pool their wisdom to serve companies, primarily in the high-technology sector.

"There is a lack of knowledge in high-growth firms," Mr. Bhargava says. "They are missing access to the right business minds." One of those minds is Susan Sheehan, a former marketing consultant for small and medium-sized businesses, who will be devoting all her time to advising for Queen's.

She says most of the gathering of angels won't be dedicating the same amount of time to the centre, but they are all focused on doling out important advice.

"There is a real angel attitude around the group, there's a real desire to pass on the experience they have," Ms. Sheehan says. "There's a lot of people with 10, 20, and 30 years of practical experience and they are willing and able to share this information. . . .

"A lot of companies in the high-growth sector are experts in the technology they develop, but they can't also be experts in all the tools they need to grow and be successful."

The duties of knowledge angels could range from mentoring the company's CEO to rewriting weak segments of its business plan. Ms. Sheehan says the concept fills a gap that often hinders the growth of up-and-coming companies. "The basic management consultants may have done this, but it was not designed to be delivered to small companies. A knowledge angel can and will roll up their sleeves and get involved."

Mr. Gilbert, who has already taken advantage of knowledge angels, agrees there is a gap. "If you go to the KPMGs of the world -- there is nothing wrong with them -- but they are not geared for small companies." Mr. Gilbert says he's now looking to make use of the "virtual management" service that the centre is offering. With this service, a knowledge angel would oversee an area of the company that lacks the guiding hand of a professional.

For example, if an emerging company has yet to hire a chief financial officer but realizes it needs an experienced individual in that role, it can contract the work to an angel who will come in and advise in that area.

While top-notch advice has always been crucial, the Internet has accelerated the speed of business. Veteran high-tech executive Peter Eddison, now a principal with Ottawa consulting firm Reid Eddison Inc., says the New Economy can be unforgiving to upstart companies, leaving them with little time to make decisions or to learn from errors.

"There isn't the luxury of time to make fundamental mistakes. We [the angels] will help companies avoid the obvious things that happened when we were there," he says, adding that new companies are expected to grow more rapidly than ever before.

Mr. Eddison says the angels are not gearing themselves to raw startups. He sees their role as "pediatricians, not obstetricians." Companies that have already developed ideas, and perhaps gone to market with one of them, are best served by the Queen's advisers.

Mr. Bhargava says because the angels are being marketed to small businesses, huge fees would be counterproductive. He says the centre is flexible in its rates, and is willing to discuss payment through equity or stock options. (Mr. Gilbert indicates he paid less than $5,000 for Queen's services.)

The Centre for Enterprise Development, which itself is just launching, is designed to be a financially self-sufficient entity of the university's business school.

Mr. Bhargava has already pulled 71 angels onto his team and says he's positive the concept will catch on quickly.

"The entrepreneurship revolution isn't a short-lived trend. A lot of companies have had the realization that to be successful, they know they need help getting to that next level."

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For more information on the Queen's Centre for Enterprise Development, please visit our web site at: http://www.qced.com.