Why SME’s Need Assistance with Governance What are the Benefits for SME’s when they create better Governance Structures CEO’s or Founders need to get over the control aspects of their Board Family Businesses vs. Private Corporations Advisory Board vs. Board of Directors The Five Best Governance Recommendations for a Private Corporation Discuss experiences from the field The Challenges for Consultants when Marketing and Engaging with SMEs Best Practises in Contracting with SME’s

1. Experience. Integrity. Trust .
Governance Consulting for Small & Medium
Enterprise
Acceleration and Success
of
Growth Companies

2. Agenda
1. Meet and Greet
2. Introduction
3. Why SME’s Need Assistance with Governance
4. What are the Benefits for SME’s when they create better Governance
Structures
5. CEO’s or Founders need to get over the control aspects of their Board
6. Family Businesses vs. Private Corporations
7. Advisory Board vs. Board of Directors
8. The Five Best Governance Recommendations for a Private Corporation
9. Discuss experiences from the field
10. The Challenges for Consultants when Marketing and Engaging with SMEs
11. Best Practises in Contracting with SME’s
12. Q & A

3. Real World Experience and Expertise
Gerard Buckley
– Founder & CEO of Jaguar Capital an Advisory Practice for Growth Companies in
Governance, Financial Management & Funding Strategies
– Chairperson of Board of Directors, Maple Leaf Angels Corporation & Investor in
eight early stage companies (one positive exit and two not so positive ones!)
– Certified Corporate Director of the Institute of Corporate Directors
– Previously Entrepreneur in Residence with Incubes (An Internet Company
Accelerator)
– Past member of Small & Medium Enterprise Committee of The Ontario
Securities Commission
– Investment Committee of Mount Saint Vincent University, Halifax, NS
– 32 yr. Career with Scotia Capital as a Financial Risk Management Advisor to
Fortune 200 Companies: Rogers, CAE, Irving Group, Empire Co., Four Seasons,
Bruce Power, OPG, Province of Ontario, Ford etc., working with M&A teams
transacting over $10 billion.

4. Why SME’s Need Assistance with Governance
1. Lack of experience; they don’t know what they don’t know.
2. There is a lack of focus on strategy and value creation. Too
much time spent on product, sales and execution by executives.
3. BOD with a Non-Executive Chairperson will enable the CEO to
focus on the business
4. When board appointments are friends, lawyers, management,
board observers, investors and VC nominations the BOD often
becomes dysfunctional
5. Many companies have Multiple Voting Right Share Structures
and need assistance managing within that structure

5. The Benefits to SME’s from Better Governance
1. The true value of governance to the company can be
summarized as opportunity gains or losses
2. Tone at the Top - Leadership
3. Improved operating performance
4. Higher valuation on exit
5. Attract material vendor contracts
6. Expansion into new products and services
7. Advanced intelligence on emerging trends
8. Become a more attractive investment

6. The Benefits to SME’s from Better Governance (Cont.)
9. Stronger infrastructure available during M&A discussions
10. Opportunity for owners to change the culture of the
company
11. It makes the transition to going public easier
12. The role of the board is to ensure that, overall, the strategic
direction of the organization is right, that there is proper
attention paid to identifying and mitigating risks.
13. Better and more structured succession planning
14. Helps Management Team grow to the next level
15. Lower cost of part time executive talent pool
16. Improved staff relations

7. CEO’s Need to Get Over Controlling the Board
1. It is a huge transition – especially for founder-owners accustomed
to calling all the shots
2. When you accept other peoples money as an investment, you
should expect them to have a say
3. A BOD shows that a CEO is confident about his position and the
growth of the business.
4. Many founders of early and growth stage companies do not realize
the value of effective governance until it is too late when investors
start dictating how to run your company.
5. Improved accountability and performance assessment
6. This can be a circular reporting structure. CEO – Board –
Shareholders, who may also include CEO. However the CEO should
report to the BOD for their performance and at the end of the day
the shareholders hold the hammer to elect the directors.

8. Family Businesses vs. Private Corporations
1. Multigenerational issues
2. Estate vs. Succession Planning
3. Sibling Rivalry
4. Behavioural psychologists often
engaged
5. Is there professional managers
6. Is there independence in the
board structure
7. Is there a family business retreat
and is this different from the
strategic planning of the company
1. Is there a succession plan?
i. IPO
ii. M&A
iii. Management Buyout
2. Is there independence from
management or significant shareholders
3. What are the requirements and
structure of the USA – Unanimous
Shareholders Agreement
4. Is there value creation for all
shareholders
5. A director is more involved in growing
the business

9. Advisory Boards vs. Board of Directors
1. Rare today among non invested private
companies
2. Too often friends of CEO
3. Third party experienced business owners
4. Unpaid
5. Form a structured advisory board early
6. People with industry knowledge, sales
experience and strong contacts
7. Formal AB Structure and Meetings
8. Meet as a group quarterly
9. Meeting Materials in advance
10. Early proxy for BOD
11. Confidentiality
12. Inexpensive filling in of skills gap
13. No formal liability of BOD
1. Usually CEO, founders and lawyer
2. No accountability for CEO
3. No Strategic Direction for Company
4. Many Conflicts of Interest
5. Create a formal BOD when the
complexities of the decision making
process grow beyond the capabilities
of day-to-day management
6. Create board and committee mandate
7. Excellent communication CEO and NEC
8. Meeting Materials in Advance
9. Skill sets are a fit with the company
and the culture of the company

10. Five Best Governance Recommendations
1. Create an Advisory Board early in the company’s growth cycle and
set up a board structure just before the company raises a
professional investment round
2. Appoint a Non-Executive Chair or Lead Director to lead the
governance structure
3. Structure the board of the company for the for the size you want
to grow to. i.e. Audit, Compensation, Risk and Governance
Committees.
4. Ensure the company uses a skills based criteria to select board
members
5. Regularly communicate with shareholders through quarterly
newsletter, AGM, etc.

11. Experiences from the Field
1. I was invited by a company to help them set up a governance
structure and assist them raise an investment 60 days before
they were forecasted to ran out of cash.
2. When a company does not produce cash flow forecasts for
it’s board to review – running out of cash is inevitable
3. Growing into bankruptcy occurs for many growth SME’s
4. …………

12. The Challenges for Consultants when Marketing
and Engaging with SMEs on Governance
1. Does the company have the resources to pay you?
2. The tax consequences of taking equity for consulting work
3. Does the company have the infrastructure to implement your
recommendations?
4. Are you expected to execute on your recommendations?
5. Too many self appointed non-experts giving advice
6. Dependency on higher priced legal or accounting advisors
7. The engagement has a tendency to expand without a
commensurate increase in fees
8. No legislative requirements beyond incorporating director

13. Best Practices in Contracting with SME’s
1. Ensure there is a signed contract with a specific scope of
work outlined.
2. Retainer with monthly or bi-weekly invoicing
3. Discuss roles and responsibilities of management early
4. Define deliverables in pragmatic terms
5. …………

14. Jaguar Capital
An advisory firm in Governance, Financial Management and
Funding Strategies.
Our client focus is on growth companies in Financial Services,
Technology, Energy, Digital Media and Healthcare.
Jaguar Capital is specialized in
Evaluating, Pivoting and Growing Companies

15. References
1. 20 Questions Directors Should ask about Building a Board by Hugh Lindsay, The
Canadian Institute of Chartered Accountants.
2. Governance for Family Controlled Companies by Barbara Spector, Private Company
Director, July 28, 2014
3. Navigating Governance Options in a Private Company by Chas Klivans, CEO Briefing
Newsletter, July 19, 2013
4. Action Steps for succeeding with a Board of Advisors by Debbie Womack and Jim
Taylor, Private Company Director, September 29, 2014
5. Founders Dilemma: Do you give up Full Control for Better Vision and Oversight? By
Virginia Galt, Directors Journal, July 7, 2014
6. Why Many Directors Prefer Private Company Boards by Carrie Hall, Forbes, Dec 26,
2013
7. Chairs and Tables: Corporate Governance for Directors of Small to Mid-sized
Companies by Donald B. Hathaway, Independent Review Inc., ISI Publications Limited,
2008
8. Startup Boards, Getting the Most out of Your Board of Directors by Brad Feld and
Mahendra Ramsinghani, John Wiley & Sons Inc., 2014
9. Great Companies Deserve Great Boards, A CEO’s Guide to The Boards Room by Beverly
Behan, Palgrave MacMillan, 2011

16. Jaguar Capital Team
Gerard Buckley, BBA, FICB, ICD.D
Managing Director
Jaguar Capital Inc.
401 Bay Street
Toronto, Ontario, M5H 2Y4
(C) 416-884-9522
g.buckley@jaguarcapital.ca
www.jaguarcapital.ca
@jaguarcapital
@gerardbuckley