For Tom Jenkins, who helped build Waterloo-based OpenText into one of the world’s largest software companies, business success comes down to positive cash flow.
“You're not a real company until you're in charge of your destiny,” he told a breakfast gathering at the Communitech Hub earlier today. "The crux of being in charge of your destiny comes down to one fundamental factor – positive cash flow.… If you neglect to secure positive cash flow, you forfeit control over your destiny.”
Jenkins – the current Chair of OpenText and the former President, CEO and CSO of the company – shared some valuable learnings from a long and distinguished career in Canadian tech.
In a fireside chat with Communitech CEO Chris Albinson, Jenkins talked about the importance of acquisitions, understanding your business goals, exit strategies, long-term success, economic trends, artificial intelligence and more.
Every company and every leader has different strategic goals, he said, emphasizing the importance of knowing what the best path forward is for you and your business.
“Consider whether it's wiser to grow by 20 per cent and achieve a 10 per cent profit rather than pushing for 50 per cent growth,” he said. “Strategically, you must assess if you can afford this approach and whether your market will remain viable.”
OpenText evolved from search-engine research at the University of Waterloo in the early 1990s. Over the years, it has grown into one of the world’s pre-eminent information-management companies. Earlier this year, it completed the US$5.8-billion acquisition of British SaaS company Micro Focus International, making OpenText one of the biggest B2B software companies on the planet.
During the early days of building search engines, Jenkins said his team reached a “pivotal moment.” They had achieved significant growth, but they realized that sustaining rapid expansion while maintaining their culture was challenging.
“We made a conscious decision that we were going to target 30 per cent growth,” he said. “There is no hard and fast rule, but I think most of the management team and the staff understood why we did it. The decision marked a cultural shift, but ultimately contributed to our long-term success."
Jenkins also emphasized the importance of trust in business relationships.
"Your customers, your staff, your investors – there's one word they all rely on, even if they don't always realize it: trust,” he said. “In our line of work, which often deals with intangibles, trust is the foundation. Starting with trust as your basis is essential."
Jenkins also noted the recent dramatic shift in inflation – from years of low inflation to the current situation in which high inflation seems to have settled in for the long term. To deal with inflation growth, he advised founders to add Cost of Living Adjustments (COLAs) to all their product and service contracts.
"To secure your company’s future, openly discuss these clauses with clients,” he said. “This ensures fair adjustments over time, maintaining strong client relationships. Neglecting this may risk increasing delivery costs while revenue remains fixed, threatening financial stability."
The breakfast event, which attracted 96 attendees from across the tech ecosystem, also included a presentation by Maria Plummer, CEO of Ingenyewity Inc, who shared her journey as a nurse entrepreneur.
Frustrated by the problem of tight intravenous connections, which she encountered daily during her nursing career, Plummer decided to find a solution.
“After many years of watching nurses waste time trying to disconnect tubing from patients and witnessing the anxiety on their faces as one nurse, two nurses, sometimes three different nurses struggled to disconnect their IV lines, I came up with YewTwist,” she said.
Designed in Canada, YewTwist is a small device that offers a quick and secure way to disconnect and change intravenous and feeding tube connections.
Plummer participated in Communitech's Fierce Founders Uplift and Intensive Track programs, which she credited with helping her to refine her business plan and go-forward strategies.
"Today I've raised over $310,000,” she said. “I started manufacturing in Quebec a few months ago, and as of last week, I received a product that is ready to sell and go to market."
Plummer also shared her plans for the future.
“My next steps involve integrating YewTwist into other healthcare verticals, beginning with oncology, dialysis, and home care,” she said. “These are my target markets with high intravenous line usage.”