Partner Profiles | April 15, 2015

Pete Schouten: Confessions of a Serial Entrepreneur

Pete Schouten was entrepreneurially hardwired from an early age. He shares what he’s learned in the course of launching his many business ventures such as Hardbite and Fraser Valley Biogas.

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“An entrepreneur is somebody who is always looking for a better way and not afraid to risk something to achieve it,” explains a busy Pete Schouten. “I’ve never counted how many businesses I’ve been involved in and I don’t have one I’m necessarily most proud of, but Heppell’s, Hardbite and Fraser Valley Biogas would be among them. It’s equivalent to farming for me, but watching an idea grow instead of a crop like potatoes or squash. I’d say I’m addicted to it.

I got good advice early on. My Opa (grandfather) told me you have to understand the business areas you’re in and the ones around them. Look at the question marks. When there’s question marks, everybody wants an easy answer. People don’t usually pursue things if there’s not an easy answer. The hard part is to always ask the next question. That usually leads to the next opportunity.

Growth of an entrepreneur

Apparently when I was seven I told my parents I was going to be a farmer. When I was 13, our family moved and when we were finished unpacking, I was allowed to go ask for a job. The seventh farm I stopped at was Heppell Brother’s Potato Farm. They gave me a job and I never left!

I worked there all through high school. At one point I had many of my Grade 11 and 12 classmates hired for different jobs. As time went by I was given more responsibility. With that came accountability and in 1993 I bought half the farm from one of the sonsand the original brothers. From then on we grew the business, buying up several other farms along the way. The next question was, ‘how do we sell more of our products’?

Farming led us to marketing; marketing led us to BC Fresh. BC Fresh is a group of local farmers who got together and started a marketing company so we could come up with a brand and a set of quality standards that could be recognized in the marketplace. That’s also how I found out about Hardbite.

Going all in for chips

When I was on the Board of BC Fresh we had a customer that was beyond 60 days overdue. He’d been a good customer, so I went to visit him. It was Hardbite. I loved the product, so I started talking to the owner, who had some health issues, thus the 60 days overdue. He said, ‘Don’t worry, Peter, I’ll pay you,’ but it never got any better. So I went back and said, ‘You should sell me your company.’ He said he could never do that. But after a few more days of thinking about it he decided he would.

I thought, ‘well, I know how to grow potatoes, I think I can figure out how to make potato chips. I don’t know how to market but I know a guy who does and he used to work for Frito Lay.’ So I approached Braden. Being entrepreneurial as well, we decided to make it happen. And it’s been great so far.

Going big into biogas 

The only reason I got into biogas was by asking the next question. We know the key to growth in farming is land. Land prices in BC are so high, on a cash basis you can’t really afford to potato farm. So how do we increase our business? Well, we needed more land. So we looked around and asked ourselves the next question: what do other farmers with land need so we could borrow or trade for it?

Who has most of the land? Dairy farmers and poultry farmers. So what problems do they have? Well, they need feed and have to manage their nutrients. Well, how can I help them with that? Maybe I can look after their manure. What can I do with their manure? Well, renewable energy. Hey, that’s not a bad idea. How does that work? And that was the start.

We invested in a company called Catalyst Power. I was one of the initial investors that helped get it going. And sometimes with entrepreneurs, you start something else and you go, ‘oops, that wasn’t such a good idea.’ But then, because you’re in it and you’re focussing on it, you say, ‘well, that wasn’t a good idea, but if we did it this way, then it’ll be a good idea.’

About a year in we realized somebody had made a mistake on the math and I hadn’t paid enough attention, I was too entrepreneurial, too in love with the idea. Once I realized that, we brought in some accountants and concluded it was a bad deal. We proposed a restructuring plan. Not everyone was interested and we needed 100% commitment from all parties for it to go ahead. The bank threatened foreclosure so we made a deal on the debt and did it ourselves. If I was setting it up from scratch all over again I would build the plant quite differently – simple. Not as scientific. This one cost a very large amount of money to construct and get running.

Today Fraser Valley Biogas is the most successful biogas plant in the country and we currently supply over 90% of BC’s renewable natural gas.

Insights and lessons learned

One thing I struggle with is guilt. If I can’t do it myself, why should I expect somebody else to do it? I’m learning to overcome that, I only want to work with people smarter than I am, who I can trust. Success in certain areas doesn’t make you a genius of geniuses. Entrepreneurs don’t trust easy and don’t like to explain or prove their theories. It’s hard to ask for help. Recognizing you need it is even worse.

I see opportunities in everything and I have the ability to do whatever it takes. If somebody says ‘can’t’, I laugh. It’s not in my vocabulary. But there’s a big difference between ‘can’t’ and ‘I’ve decided not to.’ And it’s taken me many years to say, ‘Okay, it’s not that I can’t do this, it’s just that it’s probably not a good idea for me to do it.’

My number one life lesson up until now is to try and never let your ego outgrow your ability. Generally anybody who focuses on something and works hard is going to do well. But doing well doesn’t make you great at everything, so you tend to get a bit cocky. And there’s a difference between cocky and confident. I found myself in a few places where I thought, ‘You know what? I’m just smart.’ And really… I’m not. It would have been good to ask for help!

One example of that is the software business. I should never have got into that. I invested in some optometry software and lost money because I didn’t know anything about it. Why would I do that?

It’s better with good people

Sure, you can do it by yourself. But it’s never as satisfying and will never grow past what you can do in a day as doing it with really good people. So you also have to develop a network of friends that you trust. The best entrepreneurs have a couple of people. Because when you’re what I call the ‘Gold Rush’ zone, where you’ve got gold fever, you need to defer decisions to your best friends, the ones you trust.

I can basically sell snow to Eskimos but these friends will listen to my sales pitch and then actually call me on it. They’re looking out for you and will say, “I understand what you’re talking about, but you’re wrong.” You know you can trust these people. If I were to ask Braden a question like that and he said, ‘Pete, walk away,’ I’d probably ask him more than three times, and if he still said walk away, then I would.

A successful marketing partnership 

It’s been an absolutely fantastic relationship with Relevention (now CREW). Braden and his whole team have this way of taking the pressure off me, but still allowing me to exercise my creative mind. When I tell Braden stuff, he tells it back to me like I dream it would be. And I go, ‘Perfect.’ Not only do they get it, but they understand how to execute it. And I don’t.

The next question…?

Here’s my favourite thing. We start harvesting potatoes in the last week of May, and that’s usually when we are getting right into BBQ season. I subscribe to the renewable natural gas program, so there’s nothing more satisfying to me than having a bag of Hardbite potato chips, baking some potatoes and steaks on a barbeque that’s burning the RNG we made. It takes it all full circle. Its fantastic.

One of our R&D projects is to grow hops, and what would go great with steak and chips? A beer. So who knows, we might even get into brewing.