Luc Filiatreault Of MDF Commerce: Five Things I Wish Someone Told Me Before I Became A CEO
My advice would be to connect what everybody does on their day-to-day job with the success of a greater group. If you make that very clear in everybody’s mind, you will create a fantastic work culture.
As a part of our series called ‘Five Things I Wish Someone Told Me Before I Became A CEO’ we had the pleasure of interviewing Luc Filiatreault, CEO, mdf commerce.
Luc Filiatreault is the CEO of mdf commerce (TSX: MDF), a SaaS leader in digital commerce technologies employing approximately 800 people with offices in Canada, US, Denmark, Ukraine and China. With a background in Engineering Physics, Luc has an impressive track record of successfully growing businesses. He founded and/or led seven businesses in technology, IT and aerospace, completed two IPOs, and raised multiple levels of funding totaling over 200 M$ from Canadian and US venture capitals, as well as institutional investors. Luc is a natural leader with great communication and interpersonal skills. He has the experience to take a company in hyper growth to the next level where it will become a dominant player in its market.
Thank you so much for joining us in this interview series! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
I don’t come from an enterprise family. My dad worked for the Canadian Embassy, and so I was raised and went to school in ten different countries across the world. I actually wanted to become a neurosurgeon. I tried to get into medical school, but that didn’t work out for me. My grades were good, but probably not good enough. So, they told me to go and do what I am good at, for then my grades will be better, and I can try med school the following year. What I was good at was physics. So, I took a program in engineering physics, and I loved it and I thought I will work in science or research. But as it turned out, after my degree I didn’t want to go into medicine anymore.
I started my MBA, and embarked on a case team for the college I was studying in. I became the engineering business person on that team who everyone would go to for their technical issues. That’s where my interest in business began as it married both the technical side that I had come to love and unique everyday challenges of running a business that I enjoyed. Thereafter, I started a business and learned everything that came with it from developing products, to finding customers and financing, and more. I built that business for about 15 years and took it public. It started with four buddies and grew significantly to close to 1400 employees in about ten offices worldwide before it was bought out. Today I’m on my eighth mandate as a leader of a business. So, I’d say it’s a series of life events that led me to where I am today and I’m enjoying every moment of it.
Can you share the most interesting story that happened to you since you began leading your company?
I joined mdf commerce almost three years ago and we quickly took the view that we wanted to consolidate the North American public procurement market. While we were already in the business, we needed to scale, and we started by acquiring Vendor Registry in November of 2020. We had also been in discussion with Periscope Holdings, an eprocurement company in the US, since the early days of the pandemic. They told us that they are interested in being acquired, but not exactly at that time. So, we kept tabs on them and eventually, a few months later, at the beginning of summer of 2021, they told us that they are now running the process to sell their business.
Acquisition is an extensive process with very stringent and extremely tight deadlines, guarantees, ability to finance and more. So, we began this journey that marked an incredibly busy time for us. With teams working round the clock, we put together three financings during the process — raising approximately $65 million through a private placement with some of our larger investors, opening up some further credit lines with our bank, and getting a loan for a portion of that; following another public raise all to finance a $259.9 million deal. We were picked to be the exclusive negotiating team with the business, and we closed that acquisition in five weeks after we were granted exclusivity. It was a marathon run for us.
It is with a lot of pride that we came out and bought the business which put us almost instantaneously in the position of North American leader in the public procurement market. We are continuing to grow the business and already have 6500+ government agencies across 40 US states and 10 Canadian provinces with a network of approximately half a million suppliers.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
Looking back, the funniest situations have been when things have gone wrong while giving demos to the customers. One obviously tries to counter and make sure that everything goes well but for some reason there are always some or the other issues that arise on demo days.
One such situation was when we had some customers come over to demo a client server system. These were days when there was no Wi-Fi. Yes, there was internet, but it was still very basic. So, it was very important for us to demo this new client server concept and for that we needed a computer and a server. To avoid any trouble, we had put all the softwares on the computer, set up the board room with screen projectors and at the last minute one of our engineers highlighted that we’re demonstrating a client server application, but this computer is not connected to anything on the table. So how will the client think that it’s a client server application? Then we had somebody run a wire from the ceiling and plug the wire into the computer and get the ethernet connection. The funny part was this wire was right in the center of the table and was very visible.
The clients came in and we started the demo and suddenly the wire just fell off the ceiling. And the person doing the demo, who was one of my partners, covered up saying that we lost the connection for a moment, and he will check-in with tech support to see what is going on. He left the room, called tech support and requested him to come soon to fix it and make the issue look real. We then had a technician come back with a ladder, climb up, plug in the wire, securely this time and say that we lost connection and that could influence some lag and delays in the software app. The demo went well after, but it was quite an adventure for the team at the time. The important lesson we learnt that day was to double check, triple check elements before a client demo because as Murphy’s law goes, anything that can go wrong, will go wrong.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
I won’t be able to give just one name because there are a slew of people that were instrumental in getting me where I am and allowing me to have the opportunity of leading this great group of people. A story that I could share is of a person who was the VP of marketing and sales with me in 5 of the 8 companies I worked at. I had just completed the IPO of my first company, and she called me out of the blue to ask for a job. She wanted to join our sales team and at the time when she first called, I didn’t know her, so it was cold and distant, but she kept insisting and eventually we hired her.
She is a petite 4 ft 7 lady with an extremely severe case of arthritis, and it was visible because her hands and legs were very crooked. She was diagnosed with it when she was 13 years old, and the doctors had told her that she would not live beyond 20 years. She worked with me till about 22–23 years and is still alive today. Eventually, she retired but she is such a strong willed and an extremely soft-spoken person. You could tell that she was suffering, her body was in a bad shape, but she was so good at guiding people and getting the work done. There was no way one could say no to her when she would politely ask “would you mind staying over this weekend and finishing CRM implementation and the new website?”. We had an extremely strong connection and could work together without even talking. She is one of the extraordinary people I had the opportunity of meeting and there are many others!
As you know, the United States is currently facing a very important self-reckoning about race, diversity, equality and inclusion. This may be obvious to you, but it will be helpful to spell this out. Can you articulate to our readers a few reasons why it is so important for a business or organization to have a diverse executive team?
I was raised in 10 different countries and have lived in the UK, Belgium, Morocco, United States, and Canada to name a few. Growing up across 3 continents enabled me to gain exposure to vastly different thought processes, lifestyles and point of views, which I am grateful for. I believe that in a business, the most complex problems you are up against are rarely technical but always human because it is humans that drive a business, and a diverse executive team can become a source of rich insights that help solve complex business problems with ease.
For me, it is the ability to have the perspective of people that grew up in a completely different environment and have diverse beliefs, educational background and more that can become a strong asset for a business.
As a business leader, can you please share a few steps we must take to truly create an inclusive, representative, and equitable society? Kindly share a story or example for each.
Welcoming all kinds of people from diverse groups and backgrounds to join the team without any preconceived notion or bias towards a particular group is a first step towards creating an inclusive and equitable society. In our case I think it’s something that we do naturally, we have offices in 5 countries over 3 continents with close to 800 teammates. Our latest internal survey on diversity, equity, and inclusion allowed us to learn that our teams across the globe are from 19 religions, 13 ethnocultural backgrounds and 23 spoken languages. Moreover, we have 45% of female-identifying leaders in our management team with some amazing women on the forefront, defining and implementing our corporate strategy. We’re very proud of this wealth that goes along with our values and commitments.
Because we are a group of varied people, when I see completely monolithic groups, teams, that are all of the same kind, it bothers me, and I am shocked that it’s not representative in today’s day and time. So, I think we just went into it naturally and maybe because we are a technology company, we lean to that a bit more. People here can work remotely, we have people in Africa, South America, Europe, Ukraine, US and Canada, a couple of people in India, and Thailand too. So, it is not even something that we have to put some thought into because it is natural.
Another step that I feel leaders could take is to put a bit of a force into asking companies or investors to have policies to disclose and to show how and what steps they are taking like ESG policies, if you’re a company that does not have it today then you lose on a lot of things. This will create a structure and the framework to increase diversity and inclusion.
Ok, thank you for that. Let’s now jump to the primary focus of our interview. Most of our readers — in fact, most people — think they have a pretty good idea of what a CEO or executive does. But in just a few words can you explain what an executive does that is different from the responsibilities of the other leaders?
The CEO needs to reflect the mindset of the business at all times. In their role they need to be inspiring for their clients, their investors and the employees. These groups of people can and will have different views or wishes. Hence, I often describe the CEO’s job as somebody who is in the middle of a triangle and at each of the corners of the triangle are the investors, the employees and the customers and they are trying to pull in their own direction. Investors want the highest possible ROI; clients want best products at cheapest prices and employees want a better pay to take home and ideally to work a little less, so these are forces that are pulling in each of the directions.
Here, you’ll see my physics background — the triangle is the only shape that cannot bend. If you try to bend a triangle it will break. You can bend a square or an oval but not a triangle. So, CEOs are tasked with finding an appropriate balance between these three forces and managing the energy to avoid an imbalance which can make the company lose it all. A CEO then becomes that voice and presence that manages people for the best outcome for the enterprise.
What are the “myths” that you would like to dispel about being a CEO or executive. Can you explain what you mean?
The myth that I find the most interesting when I coach a lot of young people is the thought that as the CEO, you control everything. But in my opinion, the more responsibility you have, the less you control, and the goal is more to influence. In order to influence them, you have to give control to the team members and use your influence to keep the balance I was referring to earlier when describing the company triangle. If you force control, it may work but to me the most inspiring people I met were the ones that made you think that you are the most important person in the world and that’s what I feel being a leader is all about. If as a CEO I can talk to people and influence them to be empowered with the company mission, then we’re going to win because it’s never the power of one person but the power of a whole group coming together that drives it home.
Another one is a funny one. A lot of my friends say that since I’m the boss, I can do everything my way and that I am not answerable. But that isn’t the case. Consider this, if I have a boss and I am having a bad day, I could go to him and say I’m having a bad day. Can you please give me a break today because something happened in my life and I’m unable to perform adequately. As a CEO, I cannot go to my clients and say we’re having a bad day and we cannot serve you today. I can’t go to my employees and say that I am not feeling well today, sorry, you’re going to have to find something else to do.
I consider myself a tool to execute. If there is a time when there are difficult negotiations or there is a problem with a customer, that’s when you bring me in. If you could do it all and it works well, you don’t need me. But if there is something I can help with, consider that I’m a tool at your service at a time in need.
What is the most striking difference between your actual job and how you thought the job would be?
I don’t think there has been any striking difference, and that’s probably because I have been doing this for almost 30 years so I know what I am walking into and what to expect.
Do you think everyone is cut out to be an executive? In your opinion, which specific traits increase the likelihood that a person will be a successful executive and what type of person should avoid aspiring to be an executive? Can you explain what you mean?
I don’t believe everyone is cut out for it. It’s also not a trait that you can learn. You can learn about marketing, human resources, and finance, but becoming an executive is about being an inspiration to other stakeholders. It’s where your behavior will influence individuals to do things in a way that is profitable for the company’s shareholders, clients, and employees.
To be an executive, you must have the desire to be one, be able to handle pressure and stress, and be in good health. You must also be able to accept the constant pulling in different directions and find the balance within, to balance the client, customer and investor trio. Furthermore, you must be willing to work, eat, sleep, fly, and travel at any moment without notice. Becoming an executive involves investing a lot of time in it, and one shouldn’t aspire to be one if they don’t absolutely enjoy it.
What advice would you give to other business leaders to help create a fantastic work culture? Can you share a story or an example?
My advice would be to connect what everybody does on their day-to-day job with the success of a greater group. If you make that very clear in everybody’s mind, you will create a fantastic work culture.
I’ll use this as an example I learnt a long time ago from the owner of the company called Davie Shipyards in Quebec, Canada. When he took the leadership of this company, the company was not doing well and there was not much pride in the work they did. When he joined the company, he walked around and asked people what they did and after speaking to a couple of hundred people he realized that no one mentioned that they built ships. So, he went to his main engineer and told him that from then on he wants every work order to show the picture of the ship with a little bubble about where this person’s work is going to live on the ship when it’s built. So that they don’t only see plumbers welding pipes but plumbers welding pipes to build a ship. It took some time to implement it but when he went around the ranks later, everybody was proud of what they did, and it became all about the ship. There wasn’t just a welder anymore, these were guys who built the ship.
We try to do that too. The majority of our employees, whether they are IT professionals, technicians, programmers, or guys who write code, are told in layman’s terms that they are essentially creating a marketplace for public employees and that they should be proud of it for they are helping public employees get maximum value out of every taxpayer dollar spent in procurement — this is what primarily shapes the culture.
How have you used your success to make the world a better place?
I was asked to join numerous charity foundations and have used my network to help raise money for them. My most rewarding experience was for 8 years when I was the leader of the Quebec chapter of the ‘Make a wish’ foundation which is well known across the world. It was a small organization with a $50,000 budget trying to fulfill 10–15 wishes for kids that have life threatening diseases. Over the course of 8 years, we grew it into a nearly $4 million non-profit that granted 400–500 children’s wishes. I was personally involved with many of the families, went to some of the trips we organized for these kids. I haven’t discussed this before, but I am a pilot, I own an airplane and I feel grateful to have had an opportunity to fly some families who couldn’t fly on commercial airlines because their kids were too sick to fly. I used my success to make the world a better place by tapping my network of powerful people to move things in a better direction.
I currently serve as the Director of a school foundation in my town. When I joined the foundation, they were mostly raising money by selling cheese and muffins. I ramped up their fundraising efforts and they now have some fantastic corporate sponsors who contribute a significant amount of money to enhancing the school through various collaborations. I also coach aspiring leaders and am on the board for some smaller companies. Entrepreneurship is what I thrive in, and I use my skills and my network to bring value to causes that are closest to my heart.
Fantastic. Here is the primary question of our interview. What are your “5 Things I Wish Someone Told Me Before I Started” and why? (Please share a story or example for each.)
- A CEO never clocks out — A CEO’s job is 24/7. If you work in a group of people and you’re sick one day, somebody else can take your place and somebody else can take your work and finish. But there is usually only one CEO. So, my wife often says I am married to my job as much as I am married to her. Maybe that is something that one should know before they take on the responsibility of a CEO.
- Explaining what you do for a living is part of the job — I often think about my kids and explaining to them what a CEO’s job is. If you would ask my kids about what I do, they would say “Oh, my dad is always on the phone. I have never seen him do anything else”. Since the pandemic, I use one of the bedrooms as a place to work and I am mostly glued to my chair on calls from 7am to 10pm or sometimes later. So, it still takes explaining within my own circle and family for what I actually do as a CEO.
- Managing the company is all about managing its people — I thought most problems were technical and if I am really smart I could solve all the problems. But I wish someone would’ve told me to take psychology because leading a company, leading a group of people is mostly psychology. You have to learn how they are, how they react. In the first few weeks of the pandemic, people were extremely stressed and everybody at mdf commerce worked from home. It took a bit of an adjustment to deal with psychological aspects of being alone, fear of COVID and more. A leader’s role is then quickly transformed to become the person that motivates, guides and brings this big group of people together and moves ahead in one direction. I firmly believe that it’s all the soft skills that make the difference and not the technical background.
- It’s not right if you are not having fun — Becoming an executive involves investing a lot of time in it and comes with its ups and downs. But it is important to have fun on this adventure. I wish someone told me that I was going to enjoy this journey as much as I have been.
- Influence trumps control, always — As I mentioned earlier the more responsibility you have the less you control and the more you influence. A CEO’s job is to influence people to do what’s best for the company and its clients willingly. I have always known that controlling isn’t my style of leadership, and now I know why because influence goes a long way in motivating and encouraging people than control ever will.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good for the greatest number of people, what would that be? You never know what your idea can trigger.
I will go back to what I know and what I did, including my work for the ‘Make a wish’ foundation, which is now a network of 240 countries and is active in helping young people with serious medical problems. Strengthening this movement would be a step further!
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
It’s two words- “Never Quit”
There is this popular image of a frog trying to strangle a Heron while its head is stuck between Heron’s beaks as the Heron attempts to swallow it. I use this image quite often because things get hard and the ups and downs of running a business are quite high, but you can never give up and you can never let go. Simply put one must never give up trying!
We are very blessed that some very prominent names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US with whom you would love to have a private breakfast or lunch with, and why? He or she might just see this if we tag them.
Well, I doubt he would have time to join me for breakfast, but Barack Obama is one of the most well-known Americans who has had a big impact on me. I have a great deal of respect for the man and his leadership (even outside of politics). He once visited Montreal to give a speech, and although there was a sizable audience, I somehow got the impression that he was speaking directly to me and very few leaders are capable of doing that. I’d love to get better at doing that myself.
Thank you for these fantastic insights. We greatly appreciate the time you spent on this.