Last month, a significant change took place at Espace MicroCaps. My partner Philippe made the important decision to become a full-time entrepreneur and to leave Espace MicroCaps, as you may have read in his blog post. From now on, I will be the one in charge of this blog and the exceptional community that Philippe and I have built together over the past five years.

And I don’t take this opportunity lightly.

Those who know me are familiar with the fact that I love reading. I read about thirty books per year on various subjects such as investing, technology, entrepreneurship, personal development, physical training, etc. Recently, I had the chance to read a book that made me think deeply about my vision for the future of Espace MicroCaps, as well as our place in this vast ecosystem of stock market investing.

The book I’m referring to is called “The Infinite Game” by Simon Sinek.

Before I tell you a little more about the book, I will start with the basics, which is defining the two types of possible games: finite and infinite.

Finite games, like football or chess, have a predetermined number of players and fixed rules, as well as a clear ending. At the end of a finite game, we can tell for sure who is the winner. Conversely, infinite games do not have a finish line and the rules may vary along the way, as is the case in business or life in general. Players may come and go. You can be the best at something for years or even decades, but you cannot be proclaimed the ultimate winner in business or life. The game continues on and on.

So how do you manage a business in the context of an infinite game?

The most important thing, according to Sinek, is to find a “Just Cause” towards which we can progress every day, knowing that we will never reach a finish line. Here is an example to help you understand the difference:

Finite goal: Become the leader in your industry.

Infinite goal (“Just Cause”): Work to improve your product or service every day to better meet the needs of your customers.

Notice how the infinite goal involves a process of continuous improvement? Can we become the leader in an industry by pursuing this objective? Of course. But it is not the end in itself.

The goal in an infinite game is not to win but to stay in the game by advancing a “Just Cause,” a vision of a better future.

A “Just Cause” has several characteristics. In particular, anyone must be able to join it. If the cause is just, why would we stop anyone from helping us on our way to realizing this vision? Also, individuals and businesses do not need to create their cause; they can join an already existing one.

Over the past few weeks, I have taken the time to reflect on this notion of “Just Cause” and about the impact I would like to have with this blog and the various projects in which I am involved.

I realized that I related very much to the mission of Ian Cassel, the founder of MicroCapClub. In a speech he gave in 2016 at the MicroCap Leadership Summit, Ian mentioned that his mission was to bring credibility and respect to the microcap space.

I realized that many of the things I do are related to this cause.

 

Why Is This Important?

Did you know that in 2017, small businesses (1 to 99 employees) employed more than 8 million people in Canada, which was about 70% of private-sector workers across the country?[1] Small businesses were also responsible for 68% of new job creation. Based on these statistics, we can undoubtedly say those small businesses are the lifeblood of our economy.

Some of these small businesses happen to be publicly traded. They are microcaps and there are more than 2,100 of them on the Canadian public markets.

These companies create jobs for Quebecers and Canadians, but they also create new innovative products and services that help us move forward as a society.

Our society must foster entrepreneurial success to create wealth for Quebec and Canada. It is essential to support and invest in our local businesses to generate the flywheel effect you see below:

 

Espace MicroCaps can play a crucial role in this ecosystem by democratizing microcap investing. More credibility and interest in the sector will attract long-term investors and provide entrepreneurs with better ways to access growth capital. This will promote the development of tomorrow’s success stories and will lead to the creation of more businesses and more wealth.

In addition, with the current pandemic and the economic consequences that will ensue, this topic is more relevant than ever. Our governments frequently talk about buying local, but we must do more and also invest locally.

With this in mind, Espace MicroCaps will focus on three important objectives:

1. Educate the public about microcap investing.
2. Foster collaboration, mutual aid, and information sharing so that all members of our community improve their investment skills.
3. Encourage local investment in Quebec and Canada to make a positive impact on our economy and on the companies in which we invest.

I believe that Espace MicroCaps already partially fulfills this mission, and I intend to continue on this path.

Of course, Espace MicroCaps’ mission is not to encourage investment in all microcap companies at any price. We must maintain high quality standards. Espace MicroCaps will continue to research and highlight companies that are well managed and adopt corporate governance best practices, operate in promising industries for the future (technology, clean energy, healthcare, etc.) and, of course, companies that can be bought at reasonable valuations.

These same quality standards will also continue to be put forward and encouraged in my role as a consultant for the Rivemont MicroCap Fund. The fund is in an excellent position to continue to support Canadian businesses and to provide them with the capital they need to grow.

If this “Just Cause” in which I take part is also appealing to you, here is what I invite you to do:

1. Share this blog with the people you know to bring more attention to the microcap sector.
2. Participate on our forum (French only) to collaborate with other investors, and join us at the cocktail events in Montreal when they resume.
3. Invest in passionate entrepreneurs from Quebec and Canada to help them innovate and create wealth for all of us.
4. Above all, I invite you to contact me if you have any other ideas on how to advance Espace MicroCaps’ mission.

Together, let’s bring more credibility and respect to the microcap space.

I look forward to joining forces with you all!

Mathieu

 

[1] Government of Canada, Key Small Business Statistics – January 2019, https://www.ic.gc.ca/eic/site/061.nsf/eng/h_03090.html