Checks & Balances

The founders of Cambridge Mercantile Group owe their success to their occasionally opposed—but always complementary—personalities

CEO and founding partner Bernard Heitner (left) and president and founding partner Jacques Feldman (right) learned their entrepreneurial gumption from their parents, who were Holocaust survivors.
CEO and founding partner Bernard Heitner (left) and president and founding partner Jacques Feldman learned their entrepreneurial gumption from their parents, who were Holocaust survivors.

Bernard Heitner and Jacques Feldman have a rule that has served them well for the past 21 years: if you can’t come to an agreement, you leave things at the status quo. The founders of Cambridge Mercantile Group don’t always see eye to eye—Heitner is the risk-taker, Feldman the prudent conservative—but that’s the beauty of their partnership. And because of it, their firm can now boast 25–30 percent growth year over year. By balancing each other for the past two decades, they have expanded their corporate-business-trading and global-payments business from a single shop in Toronto to international branches in the United States, the United Kingdom, and Australia.

The success of the business and the partners’ latest concern—grooming a workforce fit for succession—say little of the slow start that Heitner and Feldman agree was essential to their personal growth as entrepreneurs. “From the outside, it may look simple,” Feldman says. “[But] you’ve got to figure out what makes the business tick and where there is money to be made.”

When Feldman and Heitner began Cambridge in 1993, they faced something of a catch-22, needing to entrust their funds to banks that they were also in competition with. The volume of transactions passing through their account and the attractive rates they could offer clients did nothing to help them build relationships with the institutions their company relied on to operate: global banks—of which there are very few. To raise Cambridge’s profile and gain legitimacy, its founders hired in-house counsel to bolster the company’s compliance record and brought in a chartered accountant to develop more in-depth banking relationships.

Through the Years

Cambridge Mercantile Group

1992
Heitner and Feldman meet and decide on a joint venture in financial services

1993
Cambridge Mercantile Group is founded

1994
After building the business on precious metals, they decide to get out of the niche market and broaden their services to foreign exchange

2000
The partners forego retail clients and specialize in corporate exchanges

2002
Cambridge expands globally, establishing branches in the UK and Australia

2007
The partners begin investing heavily in Internet technology and also begin to design, create, and implement their own proprietary software

Even with those relations improved, though, Heitner says, the business didn’t experience significant growth until the partners made the decision to focus solely on corporate clients. In response to a series of US banking crises, the American and Canadian governments pressured financial institutions to avoid dealing in fraudulent accounts. Feldman foresaw this trend posing a compliance risk for Cambridge, which up to that point had served retail clients, whose accounts could be very time-consuming and high-risk. “We thought getting out of anything [having] to do with cash was the right decision,” Heitner says. “Instead of being a jack-of-all-trades, we became masters of a field.”

Cambridge had been providing global services from the start, but in 2000 it began expanding its footprint to match. First in the US, then the UK, Heitner and Feldman reaped the benefits of serving corporations within the new jurisdictions—while also strengthening relationships with local banks to increase Cambridge’s capabilities in the foreign markets. “There are fringe benefits such as the ability to do low-value payments much more cheaply,” Heitner says. “By earning the trust of our clients, we open up new and unimagined possibilities. Growth is never by mere chance; it is the result of forces working together.” Now the UK branch gives Cambridge a base of operations for all of Europe, and a recently opened office in Australia provides a toehold in the Asia-Pacific region. Also contributing to the company’s growth is its online system, which was implemented in 2007. “It put us on a different level,” Feldman says. “We are bringing in clients who wouldn’t talk to us 10 years ago.”

“A lot of people wouldn’t agree with our approach to walk before you run,” Heitner says. “We both very much believe in growing responsibly. Even though it took a while, we learned the business first, but once we found our footing in the market and positioned our brand, it took on a life of its own and has grown exponentially.”

Raising the company from the ground up has not been without obstacles—“If people saw all the challenges of starting a business, they wouldn’t go into it,” Heitner says—but the partners’ perseverance has seen them through both growing pains and an increase in their global presence. “Our parents were entrepreneurs but also Holocaust survivors,” Heitner says. “After the war, they started life fresh and overcame obstacles—my father in the clothing industry and Jacques’s in the wine industry. They taught us that you have to push on despite difficulties, and we’ve become two individuals who will fight very strongly for what we believe.”