Navigating The Entrepreneurship through Acquisition Landscape in Canada

In the previous blog,

we explored what ETA is and why it is an exciting entrepreneurial path for aspiring business owners. In this blog post, we will delve into the landscape of ETA training in Canada, comparing it to the ETA landscape in the United States, and identifying potential gaps in the current offerings. 

Overall, our research on ETA training programs in the US and Canada revealed that there are multiple training models and avenues that entrepreneurs can take when embarking on their respective journeys: 

1. An ETA course, stream or elective in a Master of Business Administration (MBA) program 
2. An ETA certificate program via a higher education institution
3. A non-formal education training program
4. Private investment sponsors 
5. Holding companies 
6. Impact investment firm 

1. An ETA Course, Stream or Elective in a Master of Business Administration (MBA) program 

The ETA landscape in the US is highly developed, with numerous higher education institutions such as Harvard Business School and the University of Pennsylvania offering specialized MBA courses, streams and electives that mimic the life cycle of the acquisition process. The nature of the program determines the depth of what students can learn and experience, with the majority of courses and streams having comprehensive mentorship, experiential learning and access to industry networks. However, there are courses, for example at Haas School of Business, that have a more theoretical focus and encourage students to think critically about whether becoming an entrepreneur is the path they want to take after graduation. The cost of an MBA program varies significantly based on its ranking. For instance, obtaining an MBA from Harvard Business School typically costs around $175,000 for the entire program. While this may not be a significant barrier to entry for some, many prospective entrepreneurs do not have the capital or the need to obtain an entire MBA once they decide the ETA pathway is for them. Rather, the MBA is better suited for individuals who are seeking a broader business education.

2. An ETA certificate program via a higher education institution

Alternatively, for aspiring entrepreneurs who are confident they want to pursue ETA and are not interested in obtaining an MBA, Case Western Reserve provides an ETA Certificate that consists of three courses typically completed over two semesters in less than one year. The course costs students approximately 12k USD, making it a cost-effective alternative to a full MBA. Their focused curriculum is designed to cover the essential aspects of ETA, allowing students to gain specialized knowledge in a condensed and convenient time frame. Participants benefit from extensive training provided by industry experts, access to an extensive alumni network and dedicated faculty support. Thus, this certificate program is a structured educational experience tailored to those committed to the ETA path.  

3. A non-formal education training program

The third pathway, “Contrarian Thinking” is a non-formal education training program founded by Codie Sanchez. Its key components include the “Main Street Accelerator” course, a series of asynchronous videos and exercises intended to give first-time business buyers the tools, guidance and action steps to acquiring a business and how to manage the first 90 days post-acquisition. This self-paced course costs $2K USD and typically takes participants four weeks to complete. For those that want more support and guidance, they can opt to join the “Contrarian Community”, an exclusive membership that includes the course along with personalized mentorship from experienced dealmakers and owners, weekly office hours with industry experts and member-only in person events. To gain access for one year participants have to pay 10k USD and can renew their membership if certain conditions are met. Lastly, they are currently only accepting members who are committed to making their first acquisition within 1 calendar year and have a minimum of 25k USD to invest (excluding the cost of the membership fee). This selective approach ensures that participants are not only financially prepared but also deeply committed to the ETA process, fostering a learning environment that aligns with the program’s goal of producing entrepreneurs who can successfully acquire and run businesses in a short timeframe.

4. Private investment sponsors 

Moving beyond traditional educational training programs, Pursuant Capital is a private equity firm that supports entrepreneurs by employing a flexible, independent sponsor model. This approach enables them to secure capital on a deal-by-deal basis, allowing for tailored financial solutions that address the unique requirements of entrepreneurs. Moreover, the firm places a strong emphasis on partnering with management teams and entrepreneurs, offering comprehensive post-acquisition support in areas such as business strategy, operational enhancements and growth initiatives. This approach is particularly beneficial for first-time acquirers, providing them with experienced mentorship to navigate the complexities of the acquisition process.

5. Holding companies

Similarly, Chenmark facilitates entrepreneurship through acquisition by providing a platform for entrepreneurs to lead and grow small businesses. Their focus is on acquiring and operating small businesses with a long-term perspective, offering individuals to manage these businesses while simultaneously benefitting from Chenmark’s resources and support. What sets Chenmark apart from other holding companies is their Generalist Vice-President (GVP) Program, which is a structured, multi-stage training initiative aimed at developing future CEO’s of small businesses. The three core stages are as follows: 

1. Stage One: The GVP is able to work directly with Chenmark’s leadership team and their time is split between work on mergers and acquisitions and working with their operating companies on a varied mix of challenges related to sales, operations, HR, finance and technology 
2. Stage Two: Here, the GVP is given the opportunity to step into a senior leadership role at one of Chenmark’s companies, working alongside the CEO, who is often a past participant of the GVP program. 
3. Stage Three: In the final step, the GVP steps into the primary leadership role at one of their companies. From this point, the GVP is handed the keys to a small business that is theirs to run with Chenmark’s support. 

This structured progression equips participants with comprehensive and practical experience, empowering them to successfully manage and grow a small business with Chenmark’s continued support. 

6. Impact investment firm

For underrepresented entrepreneurs, New Majority Capital (NMC) is an impact investment firm that is dedicated to boosting entrepreneurship through acquisition among people of colour in the United States. Their program is the bETA accelerator, a program designed specifically to educate and prepare BIPOC (Black, Indigenous, and People of Colour) and women entrepreneurs to acquire, run and scale existing small businesses. The accelerator provides a structured learning environment that involves the following: 

1. Access to Capital: NMC provides non-extractive financial support, including 0% interest pre-acquisition loans to cover due diligence and legal costs. They also offer up to 100% financing for business acquisitions, utilizing a revenue-based financing model to ensure flexible repayment terms. 
2. Post-Acquisition Support: NMC offers comprehensive post-acquisition support, including strategic guidance, operational assistance and back-office services. 

In summary, NMC’s holistic approach equips aspiring entrepreneurs in underrepresented communities with the necessary skills and resources to successfully pursue ETA.

7. The Canadian Context

Comparatively, there is a paucity of ETA training opportunities in Canada. Unlike the US which evidently offers a number of training models, only two Canadian courses have emerged in the past two years from Western Ivey’s Business School and the University of Calgary’s Haskayne School of Business. These programs are pioneering efforts in Canada to address the growing demand for ETA education. Western Ivey’s course enabled students to discover how to identify ventures for acquisition, learned about the intricacies of the deal-making process, and how to operate businesses with long-established legacies. Similarly, Haskayne’s ETA course “take[s] MBA students through the steps of developing a search fund to secure financing, finding a business to acquire, making the business acquisition and managing a profitable SME”. Since this course began in January 2024, it appears that they are actively looking for investors, volunteer advisors and active search funds to support the program. 

With this in mind, there are a number of gaps in the ETA training opportunities currently offered in Canada: 

1. Introductory ETA programs: There is a lack of accessible, introductory-level ETA programs that cater to individuals who are curious about ETA but are not yet ready to commit to an MBA or the acquisition process. An introductory program would help participants to assess their suitability for ETA by offering basic skills and knowledge, being highly flexible and accessible. 
2. Programs to help participants determine if ETA is right for them: The current offerings lack dedicated programs or courses that focus on self-assessment and exploration of ETA as a career path. This course would ideally guide participants through the pros and cons of ETA, provide case studies and real-world examples of successful and unsuccessful ETA ventures, and include networking opportunities with experienced ETA practitioners
3. Limited ETA educational initiatives: There is an insufficient integration of ETA courses in educational institutions, specifically in MBA programs.
4. Limited non-MBA ETA education: Limiting ETA education to MBA programs is inaccessible and restricts opportunities for a broader audience who may not wish to pursue a full MBA degree. This creates a significant gap for individuals who are interested in pursuing ETA but are seeking programming that is flexible and Canadian specific. There is a need for standalone ETA certificate programs that can accommodate the needs of this audience. 

In our third and last article in this series about ETA, we will shed light on how an introductory ETA program can tackle the current gaps in developing skills and building a community to make ETA a viable and more accessible entrepreneurial path for Canadians.