How I did it: Terry McBrideThis music producer turned his passion for yoga into a new business
Business in Vancouver's "How I Did It" feature asks business leaders to explain in their own words how they achieved a business goal in the face of significant entrepreneurial challenges. In this week's issue, Terry McBride, co-founder of Nettwerk Music Group, explains how taking a yoga class inspired him to co-found his YYoga yoga studio chain.
"For me the path was unexpected. I was a typical athlete – 40 years old, sore lower back, going to the chiropractor every six to eight weeks to get cracked and straighten everything out. I thought I was in great shape. I played tennis five times a week – aggressively – I played soccer, ran, biked. I ended up taking a yoga class – the most humbling event of my life.
"I decided to bring yoga into Nettwerk as a staff activity. Within a couple of months of bringing that in, the teacher who ended up being my co-founder, Lara Kozan, suggested doing a 30-day challenge. It was at the end of those 30 days that I really began to see the effects of yoga, both physically and mentally.
"Because I travel so much, I was having a really hard time finding a yoga studio that I would want to be a member of. I found the teachers to be great but the facilities to be substandard. At 40 years old, I had no interest in showering in gang showers or changing in closets, and it wasn't very social. The initial plan was very selfish: build a yoga studio that I would go to.
"Then I began to look at the model. I probably did about two years of research, and I decided a stand-alone studio is so much work, with no ROI [return on investment] to it. Even some successful studios can just afford to pay themselves a salary and nothing more.
"I went into it thinking five [studios were needed]. If one pass works in multiple studios, and if I can create concentric circles – between where you work to where you live to where you play – the chances are the value of a pass will go way up, because you will access more than one studio. Within those concentric circles, I would really try to own the population that lives in the middle of those three studios.
"It's obviously very capital intensive. It took almost four years to get it to cash-flow positive, so there's obviously a drain on capital there. I funded it out of my own equity and, ultimately, when it really came to the crunch, I sold my house.
"The company was not making money yet. My bank account had dwindled. I needed to make sure it had enough capital to get to its tipping point. I also needed to make sure that we didn't have too much debt built up. So I went from a beautiful house in West Point Grey to a nice apartment in South Granville. That's what entrepreneurs do. It's a personal sacrifice, but I truly believe in it.
"We ended up building six studios. That got it to cash-flow positive – barely. Then last year I raised capital for expansion.
"So far I've raised about $12 million. That has allowed me to go into Kitsilano. I'm going to build another couple of studios here in Vancouver and then [expand] into Toronto."