1. Aspire to be your own boss
“It’s really because I’m the world’s worst employee that I start these things,” Jon North says of his entrepreneurial spirit. While he currently serves as CEO and director of the board at Northquest, he’s lost count of the number of junior resource companies he has started or been involved with over the last 15 years. As a professional exploration geologist, North has travelled the world, but the most fulfilling part of his job is being his own boss.
2. Plan not to pay yourself much
When North started his first company, he also worked as a consulting geologist. He took as much side work as he could get while he was building his business because, for the first year, that’s where his paycheck came from. “Quite often there’s just no money in the budget for paying yourself anything,” he says.
3. Hire the best securities lawyer and accountant you can find
“In this business, when we’re starting companies that are going to issue securities to the public and list those securities on stock exchanges, mistakes are very, very costly—in time and in dollars,” North says. Hiring an inexperienced lawyer or accountant may be cheaper in the short term, but it also might end up costing more over time. Find good people, and then work closely with them to make sure the business is run properly.
4. Keep costs modest
Since its incorporation in 2008, the biggest challenge Northquest has faced is raising money. “We’ve worked in some pretty interesting places, like Mali, in West Africa; the Far East, in Burma; and the Arctic, at Pistol Bay, and I don’t find working in any of those places difficult,” North says. “The most difficulty we’ve had is dealing with really awful markets for junior resource stocks, and that makes it difficult for us to raise money and do the things that we need to do.”
According to North, the easiest way to keep costs down is to keep rent low and limit full-time staff by hiring contractors. In fact, more often than not, companies are started in a CEO’s basement with a staff of one. That was the case when North first ventured out on his own. “It isn’t until you mature and raise, say, $10 million and start to execute your business plan that you might start hiring full-time employees,” he says. “I’ve never had more than four or five people in the head office.”
5. Think outside the box … and country
“Sometimes markets appreciate what you do, and sometimes they don’t,” North says. He is not afraid to test out new markets and learn how to do business in foreign countries that may pose risks—such as terrorism and tropical diseases—that aren’t an issue in Canada.
6. Manage risk appropriately
Northquest was in West Africa for more than 10 years, exploring a number of properties and conducting geological and geochemical work. But only one Northquest project warranted drilling, and the company didn’t end up finding gold. Shortly after the drilling program ended, al-Qaeda took over two-thirds of the country, which caused a great deal of instability. “A month earlier, we were driving around in our Land Cruisers, perfectly happy to go into remote parts of the country and camp in the bush for long periods of time, and then a month later, no one wanted to go into the field without armed escorts,” North says.
The 2014 Ebola outbreak then added another layer of danger, and Northquest ended up closing down its West Africa offices. “Had we had good results on one of our projects, we would have put a different spin on it,” North says. “But weighing the situation, it was pretty easy to pull the plug on Mali, which is not to say that if we saw a business opportunity there in the future we wouldn’t act on it.”