VentureLAB gives entrepreneurs the gift of gab

You might imagine that if you were a Hebrew-speaking Russian that had recently moved to suburban Ontario from Israel, it would be hard to kick off an entrepreneurial endeavor. Engineer-turned-CEO Vlad Zhitnikov doesn’t have to imagine, he’s living it.

Zhitnikov was having trouble launching his business as a managed service provider with Toronto-based CIT (or Cloud IT!) Corp. He found the business networking skills he’d used in Israel didn’t work in North America. The people he approached seemed much more critical of his motives, and wanted some credentials before giving him the time of day.

“They prefer that someone recommends you, and I realized that word of mouth and referrals is your best engine to expand your business,” he says.

Coming from a technical background, Zhitnikov knew how to set up his IT services company to provide for small- to mid-sized businesses. But he needed help attracting clients to his business. That’s when he connected with a Russian-speaking consultant at VentureLAB, York Region’s new innovation centre launched in January.

The centre taught the CEO “almost everything about marketing in North America and how to do it right,” he says. “In the several months in working with them, I’ve received more knowledge to analyze and rearrange my business.”

VentureLAB is the latest regional innovation centre to pop up courtesy of the Ontario Network of Excellence (ONE), a government-funded network or organizations that are dedicated to help companies commercialize ideas by providing myriad free services and resources. The York Region centre offers its members educational programs, events, networking opportunities, access to research and competitive intelligence, and more.

It joins a network of 14 other ONE-affiliated regional innovation centres and will be funded by all levels of government (municipal, regional, provincial and federal), according to Jeremy Laurin, CEO of VentureLAB.

“Many companies are often not capitalizing on what OCE can provide to them, simply because they are not aware of what OCE does,” he says. “We find teams often have a good team assembled… and they have some interesting technology and they’re just starting to understand where the market opportunity might be.”

The centre can coordinate with its partner centres, Laurin adds, and has two members of the Ontario Centre for Excellence on its team, as well as a member of the National Research Council’s Industrial Research Assistance Program.

Zhitnikov visited VentureLAB’s Markham location once a week to take part in a learning program involving a small group of entrepreneurs from different fields. The group discussed techniques for managing business, making sales, marketing and finance. Most of all, Zhitnikov learned how to manage people – a knowledge he found useful useful with his company’s one employee, he says.

“Be fair, but up to a specific level. After this line, it’s your business, it’s your money” Zhitnikov shares the advice he got from the centre. He’d been too friendly with a previous employee that ended up going too far with his freedom, and had to be let go. But the CEO took precautions with his latest hire.

“I put several limitations in the contract, so from the start the person knows his limits and responsibilities,” he says.

VentureLAB’s events are often free, or cheap to attend, Laurin says. They lean on the resources of other organizations that share the centre’s building, such as York University, the Board of Trade, and the York Technology Alliance. There’s also space for two or three hoteling offices to be set up, complete with broadband Internet and VoIP phone access if a member might need a spot to work.

The centre acts as a pipeline for the York Angels investment group, and prepares entrepreneurs to make a polished pitch to potential investors complete with statistics.

“When we send you back out the door, you’re well armed and well prepared to tell your story,” he says.

Zhitnikov also learned that it’s possible to negotiate with banks. Even if they tell you the rules and ask you to sign, there is sometimes room to push for better rates and conditions, he says. The engineer plans to meet with his bank to see if he can negotiate for a business line of credit.

Related story: Why elevator pitches don’t work with investors

“Remember, with the banks everything is negotiable. The question is whether they agree to negotiate with you or not,” he says.

VentureLAB has a goal of assisting 200 clients in its first year, Laurin says, and is well on its way to exceeding that target. Although it is a start-up organization, it relies on some resources of two predecessor organizations: the Innovation Synergy Centre in Markham and York Biotech.

“We’re really trying to find creative ways to help the big guys and the little guys connect in the region they call home,” he says.

For one Russian entrepreneur, that seems to be working out well. Zhitnikov is partnering with Microsoft Corp. on a supply agreement that will allow him to sell software licences to his clients on a monthly subscription basis, instead of needing to buy it outright. He will continue to cater to his customers in the real estate industry.

He recommends VentureLAB to other entrepreneurs: “It’s really helpful,” he says.

Brian Jackson is Associate Editor at ITBusiness.ca. Follow him on Twitter, read his blog, and check out the IT Business Facebook Page.

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