Modesty and authenticity. These are two elements that distinguish what we could call the Quebec dream from the famous American dream, according to Carl Simard and the Medici strategic portfolio management team, in a book that they themselves are publishing these days under the title In the furrows of Quebec flagships.
“In the Quebec model, your business is a family,” explains the president and co-founder of Medici, Carl Simard, who The duty met in its offices in Saint-Bruno-de-Montarville, on the South Shore of Montreal. “The American model says that money is the solution to everything, but that is not true for the Quebec model. After interviewing these people, I found the distinction: they are authentic, transparent. They have a human vision of business. »
Un Québec inc. 2.0?
“These people” are the big bosses of five Quebec companies whose proofs no longer need to be made: the hardware store Richelieu, the property maintenance experts GDI, the restaurant franchiser MTY, the plumbing and air conditioning giant Groupe Deschênes and the trucking logistics specialist ISAAC Instruments.
They form a sort of succession in Quebec inc. original, whose legacy has partly faded in recent years. We can no longer talk about Bombardier or Rona in 2024 as we did 20 years ago… Their replacements within Quebec’s entrepreneurial flagships now reinforce a model focused on growth, but not at all costs. What the Medici people call “human capitalism”.
“These people come from modest backgrounds, but had the ambition to be successful in business,” continues Carl Simard. “We notice it in portfolio management — not so long ago, there were very few millionaires in Quebec: money was a sin. We finally resolved this problem in the 1960s and 1970s, then we had Jacques Parizeau’s stock savings plan. The REA was great. »
Jacques Parizeau, then Minister of Finance of Quebec in the government of René Lévesque, announced the creation of the REA in the provincial budget statement for the 1979-1980 fiscal year. This program aimed to encourage the investment of household savings in Quebec businesses. This plan allowed Quebec savers to invest in more than a hundred Quebec companies, more than twenty of which continue to be flagships of the province’s economy: CGI, Metro, etc.
The REA also had an educational purpose: it wanted to show Quebecers that it was possible to grow their savings by purchasing shares, preferably those of Quebec companies. From this program was born a generation of savers who are today clients of portfolio management firms like Medici.
“Our pension plans are no longer as “state-controlled” as that, and there are fewer and fewer defined benefit pension plans. On the other hand, we have management companies that are excellent — and that’s exceptional,” says Carl Simard, who founded Medici with his wife, Dany Foster, in an apartment in 2008. The company of nearly 20 employees manages today assets worth $1.8 billion.
Challenges on the horizon
Illustrated as in Medici’s book, portfolio management can seem surprisingly easy. The five cases presented as flagships of the Quebec business world which occupy all the space are certainly the brighter side of the profession.
Indeed, everything is obviously not that simple. The informed reader will also have taken note of the challenges raised by the Montarville manager that these five companies will have to overcome if they wish to prolong their success.
The most important of these challenges is that of sound, sustainable governance — more particularly good succession planning. Replacing the main manager of a company, who is often its founder, is never an easy task. Talk to Apple, Disney or these other multinationals who had to repatriate their former big boss to avoid the disaster caused by their departure… “It often only takes a few bad management decisions to break the bond of trust with several employees including engagement remains essential to the organization’s long-term advancement,” the Medici folks warn in their book.
This warning served to five Quebec flagships also applies to the entire Quebec business community. The Canadian Federation of Independent Business calculated last year that 76% of SME owners in the country plan to leave their position over the next 10 years. More than $2 trillion in commercial assets are likely to change hands over the coming decade.
There will be no shortage of demand for experienced leaders, and they will need to be well trained in the meantime. Citing examples of successful companies is undoubtedly a step in the right direction. Helping investors, large and small, recognize these companies, as well as the reasons that allowed their leaders to make them flagships of the Quebec economy, is just as important.
In any case, that’s what In the furrows of Quebec flagships tries to do. In all modesty, of course.