This week, we have
an exclusive interview with Richard MacKellar, Founder and CEO of Brightside
MacKellar is an experienced technology entrepreneur and successful operations
manager who, for more than 12 years, has helped small companies grow. Moreover,
out of his very busy schedule, he volunteers time to share his highly valued
and widely recognized leadership expertise with college students.
Beginning as an
engineer with Rolls Royce, Richard went on in 1991 to his first small company,
Kevry Corporation. In 1998 he co-founded NxtPhase Corporation, a supplier of digital/optical
instrumentation, before taking over the helm of Brightside Technologies in 2003. Brightside is
commercializing research from the Structured Surface Physics Laboratory of the University
of British Columbia. The company has been receiving wide recognition for its
continuing innovation towards a final commercial high dynamic range display
product, which is being introduced this year.
holds a Bachelor of Metallurgy (Sheffield University) and an MBA (Harvard
Q: Richard, you have a proven record of innovation.
Thank you for taking the time to share your accumulated insights with our
A:ï¿½ I think of building a company in two ways: ï¿½Building
a Fire,ï¿½ and ï¿½Building a Planï¿½
1. Building a Fire
Building a company is like building a fire. For a fire
we need fuel, oxygen and heat. When considering a company in the technology
world we can think of these three elements as follows:
Market = Heat
Technology = Fuel
Oxygen = Financing
There is also an important fourth element: People. Our
job as people is to attend the fire and make it grow. At all times we need to
keep these three other elements in balance so the fire continues to grow and
doesnï¿½t go out. If we get it wrong then we hurt or kill the company.ï¿½
If we do our job well these elements also build off
one another in a continuously growing spiral. The market provides us
opportunity, opportunity helps us raise the funds, the funds employ the
people, the people develop the technology and the technology feeds the market
2. Build a Plan
The second way of thinking about how to build a
company is to follow a wonderfully simple process:
Plan, People, Process and Values
I thank Kip Smith for providing me with this simple,
but effective way of thinking about company building. Many of the most
wonderful things in life are so simple, and this is one. These elements seem so
simple and so obvious and yet I never thought about how they integrate together
until I met Kip.ï¿½
The Plan allows us to chart our course and the People
are the key resource to execute on the plan. What I find very interesting are
the roles processes and values play.ï¿½
Process is the means to overcome lack of communication.
If we all shared our thoughts completely and
understood what we each were thinking, the need for process would be minimal.
When you have two people, there is one line of communication, when a third
person is added there are now three lines of communication. With four people
the lines of communication rises to 6, with five 12 and so on. Process is a
means by which we efficiently address this exponential increase in the lines of
communication as a company grows.ï¿½
The best means of communications come from all working
in close proximity together in the same room. If Brightside or NxtPhase were
to have the processes of GE we would die under the weight. However, if GE were
to have the processes of Brightside it would be dysfunctional and fail. Thus it
is important to manage process to the appropriate scale of the company.
As a person who is process challenged and action
oriented, I prefer small companies because we have few and simple
Values more than any other attribute define a company.
Values provide a common framework within which to operate and will be different
for each company and indeed for each person. A good value set will allow
decisions to be pushed down in an organization and liberate speed, while at the
same time maintaining consistency and quality in the decision making process.
At Brightside our values fall into four core areas: Performance, Respect,
Integrity and Decision Making. Under each of these areas we have simple and
effective guidelines that help us all channel our energy and enthusiasm in a
consistent and high quality manner.ï¿½
Values are easy to adopt when things are going well. However,
their real value comes when an organization is under stress and has difficult
choices to make. This is where well developed values provide a touchstone on
which to anchor us and through difficult decisions.ï¿½
Values may sound trite and simple, but they provide
confidence to our people and prevent us from decisions that might seem effective,
but in fact could be folly. A classic example is Enron, where the lack of a
good value set led to ruin for investors and employees.
Q: Please share your ten most valuable lessons from
your experiences with NxtPhase? What would you do the same and differently?
1) You cannot take everyoneï¿½s advice
I recall going into a presentation one morning with a
venture capital company with a series of projections, going out ten years that
had taken days to prepare. When the slide came up I was roasted:
ï¿½How can you possibly project out 10 years?
If you know what is going to happen two years from now Iï¿½d be surprised. Five
is the most anyone should use.ï¿½
I left with my tail between my legs, reworked the
spreadsheet frantically over lunch, cut the numbers down to five years and went
into my next meeting with another VC in the afternoon.
ï¿½What on earth is this? How
do you expect us to get a true sense of the business potential if you only
present five years of data. Donï¿½t you understand that small companies take time
2) Technology and product are two different things
This is a hard lesson to learn, but a very important
one. Technology companies rely on invention, and inventive people want to come
into work and do something new and different every day. It is fantastic but a
disaster when it comes to a product. For a product you need to ship the same
thing today, and tomorrow, and next week, and next month. The design must work
and be frozen until the next logical revision. Technology people want to add
every new idea every day ï¿½ this has two problems: first you never have a
product; second, everything you ship is different, and it becomes a nightmare
3) Root cause of problems: assumptions and
Building on the last point I shall never forget the
day when the smartest Ph.D. inventor I have ever had the pleasure to work with
came to me. He told me he had achieved everything he had signed up for when he
joined the company - that the product worked. I looked at the pile of
components in incredulity. It wasnï¿½t close to being a product. In his mind
every element worked, it gave the right result and the rest was just
engineering to stick the bits together. ï¿½The restï¿½ took two years to do!ï¿½
I had assumed that everyone had the same understanding
of the product as I had and had failed to communicate the requirements so the
finish line was the same for everyone.
4) Program managers are an under-estimated resource
A good program manager is worth his weight in gold. The
above example illustrates the absolute need to have an individual who can
define, communicate, track and wrestle a program to the ground.
5) Building for the times
NxtPhase was built during the times of the stock
market bubble when everything was over valued and money was easy to get. The
mantra at the time was build, grow, reach 100 people as fast as you can, money
is no object.
In hindsight we should have built the business more
carefully and with a smaller team that would have had a much lower burn
rate.ï¿½ The cash would have lasted longer
and growth would have been more in line with market and sales potential.ï¿½
6) If you are offered a chance to sell, think very hard
before turning it down
In 2000 I was approached with a tentative offer to
purchase NxtPhase, but didnï¿½t even give it a second thought as the value was so
far off expectations during the bubble. Of course after the bubble burst the
offer looked very attractive, but by then it was too late.
7) The structure of a financing is important
Today, I pay much more attention to the structure of a
financial arrangement so that you consider the impact on all parties in the
event of both upside and downside. I take a more pragmatic approach to risk
management. One of the problems with venture capital financings is the
different classes of preferred shares, all with their different terms. This
leads to conflict between shareholders and non-alignment of interest. This is a
major conundrum and one that the business and investment community needs to
think very carefully about. With Brightside, (formerly Sunnybrook), we have
worked hard to issue only common shares to ensure that interests are aligned,
but this is still a non-perfect solution as it leads to severe limitations in
the sources of capital available.
8) Cash is king
This is one of those trite but true statements. If you
run out youï¿½re in trouble. ï¿½At Brightside
we do a cash review every two weeks.ï¿½
9) People ï¿½ when it goes wrong it keeps you awake at
With people, the biggest issue is their suitability or
fit and you have to take action immediately. The longer you delay the greater
the agony will be; and the more you will spend time on the poor people, when
you should spend it on the good people.
Most people issues arenï¿½t whether the individual is
qualified; it is whether they fit with the team. The most agonizing example I had
was a husband and wife team. Both were very smart and both were very qualified.
One could work well as part of the team; the other was not a fit. I spent
months trying to make it work and agonized away many sleepless nights over it. I
had to part company with one and we lost the other, which was a terrible loss
to the organization. However, without taking the action we would have blown
apart. I just should have done it sooner.
10) Have a good value set
See my earlier comments.
Q: What recommendations would you make from your time at
Harvard and the subsequent application of your education?
A: When I was seven years old, suffering from being
dyslexic and barely able to read two words, my mother worked very hard to help.
We read Arthur Ransomï¿½s ï¿½Swallows and Amazonsï¿½. In that book there was a line I
shall never forget, ï¿½If youï¿½re given half a chance, grab it with both
Rolls Royce gave me half a chance to go to Harvard. It
was a fantastic experience and I strongly urge people to really reach high when
it comes to their education.ï¿½
I often joke that I did two MBAs, one at Harvard and
one at NxtPhase. You canï¿½t learn to ski by reading a book. In the same way you
canï¿½t learn to run a business by doing an MBA. You have to get out there and do
it. You fall a few times and the difference between success and failure is
whether you are prepared to pick yourself up again and try again.
Harvard provided the foundation of knowledge and
NxtPhase the experience of hard knocks. The other fantastic attribute it
brought was access to a wealth of highly knowledgeable people. At any time, on
any subject you find access to world experts. If I were to undertake an MBA
again, I would spend less time worrying about the course work and more on
developing the relationships, as it is these that really mattered after the
Q: What prompted you to start Brightside? What are its
roots and where do you see the company evolving?
A: Brightside is focused on high performance displays
that may be used as computer monitors or televisions. They have a ï¿½wowï¿½
performance that really sets them apart from anything anyone else has
Like NxtPhase, BrightSide is a spin-off from the University
of British Columbia. When I left NxtPhase, David Jones of UBC approached me to
have a look at some other technologies that are in the portfolio. I was
introduced to Lorne Whitehead and two of his students, Michele Mossman and
Helge Seetzen. They had some very interesting ideas, a proven track record of
invention and some very good demos of their technology.ï¿½
I looked at a number of different opportunities, but
there seemed such a wonderful opportunity to work together to mould a company
around the nucleus at UBC. The one problem we had was that they wanted me to
start the day after finishing at NxtPhase, but I needed a break and took the
summer off. They were kind enough to wait.
The company has a mission to build the most
spectacular displays in the world. We will introduce products for professional
applications based on our technology, and license it to the large consumer
electronics companies to introduce consumer products. Our expertise is in
invention and so we intend to outsource our operations for product manufacture
to those experienced in this area. This will allow us to stay focused and grow
without having to add large fixed costs.ï¿½ï¿½
Q: Who are the key figures supporting Brightside
(management, engineers, scientists, board members, advisory board members, and
so on)? What prompted their interest?
A: The company came out of the Structured Surface
Physics Lab where Lorne Whitehead is recognized as a world leader in this
field. Four spin-off companies and technology that has been licensed around the
world has come out of this stable. Lorne has over 150 patents with his name on,
and since going back into academia a decade ago, has produced a patent a month.
A year ago he became the Vice President Academic and Provost of UBC.
Helge Seetzen is one of the most rounded and smartest
people I have ever met. He is young, speaks four languages fluently and did his
degree in physics, while simultaneously doing a degree in philosophy. It is an
honour to work with him.ï¿½
UBC is a critical supporter of the company and owner
of stock in the company. Without the support of David Jones, Angus Livingstone
and the UILO, Brightside would not exist.
We have also had tremendous support from the angel
community in Vancouver who have had the confidence to invest. Leaders include
Don Rix and Don Graham, Brent Tynan, the BC Advantage Fund and WUTIF.ï¿½
Brightside has built a technical advisory board that
is exceptional. It includes Gary Thomas, the former CTO of Philips Displays,
Lorne Whitehead and Wolfgang Hiedrich from UBC, Karol Muskowski from the Max
Planck Institute in Germany and Alan Chalmers from Bristol University in
We are fortunate in being able to build a management team
that is also exceptional. In addition to Helge Seetzen, we have Doug Campbell a
Nortel veteran, Gary Yurkovich from DEC and Creo, and Neil McPhail and Mark
Grist both of whom have great startup experience.
The common thread that attracted this group of people
is the belief that there is tremendous opportunity in the future of Brightside.
The opportunity to do something that has never been done before, the
opportunity to work with exceptional people, the opportunity for financial
return. We are changing the world and it is fun and rewarding to be part of it.
For some, such as Dr. Rix, there is also the chance to give back what they have
had the good fortune to receive over the years.ï¿½
Q: Share your views on current displays and where your
A: The display industry is in the middle of a huge
paradigm shift. Fifteen years ago there was one technology ï¿½ the cathode ray
tube (CRT), which came to the fore in 1935, when the Marconi ï¿½all electronic
televisionï¿½ displaced the mechanical television invented by John Logie Baird in
1926 during a showdown run by the BBC.
CRTs are still the dominant technology today ï¿½
enduring for 70 years. However, ten years from now they will be a small portion
of the market. The question is, what will replace them: Plasma, LCD, DLP, LCOS,
SED? The question may be one of price and performance, but the greatest driving
force is probably investment. We have seen a huge amount of money put into
LCDs, which led me to believe that LCD will be the winners and that other
technologies will fade, including the popular Plasma TVs. For projection
systems the jury is still out, both LCOS (liquid crystal on silicon) and DLP
(digital light projector) are in the running.ï¿½
Brightside has aligned to be able to work with LCD,
LCOS or DLP and thus the technologies most likely to succeed the CRT are
We enhance the experience seen by the viewer by making
the displays 10 times brighter, while maintaining black levels that are 10
times blacker. This gives us a contrast of over 100 times that of conventional
TVs. At the same time our display is a 16 bit display, allowing us to show more
shades per colour than the human eye can see ï¿½ unlike conventional displays,
which show just 256 shades.
I was in a meeting when someone said, ï¿½this is an MCT
technology.ï¿½ I asked what on earth is MCT. ï¿½Mom Can Tell.ï¿½ Brightside has a
technology that you can show to anyone and immediately they understand that it
is better. Seeing is believing.
Q: What were the major technical challenges that you
had to overcome?
A: We have had to prove to the world that our approach
would work; this we have done successfully. The biggest challenges have been to
develop the algorithms that are fast enough to run the display (this we have
done) and to remove the heat. The good news here is that we use LEDs that are
becoming twice as efficient every 18-24 months ï¿½ thus the industry is working
in our favour.
Q: What are your top business challenges and what is
your recipe for overcoming them?
A: Like many small companies we have more
opportunities than we know what to do with. This leads to a conflict between
desire and resources, both financial and human. We have to pick a direction and
execute on our plan within the limitations of our level of available funding. By
demonstrating success and building an exceptional team with a proven track
record, we are able to gain the financing we need to execute on our plan. Part
of that plan has been to work with partners in the industry, and after some
significant hard work, we are making good progress.
Q: Describe the entire business ecosystem to be
impacted by your companyï¿½s research and how do you hope to address the
A:ï¿½ The words in
this question are too complex for me. I can only keep about 2 or 3 thoughts in
my head at any one time, so the plans have to be kept simple. When people see what
we have, they would prefer it to the display they have today, or any that you
can currently buy. So the objective is simple ï¿½ get this technology widely
adopted in the world. How do we do that? We are unlikely to become a large
consumer display company like Sharp, Samsung, Sony or LG Philips, so we have to
partner with these people. We aim to license our technology to them. This means
lots of travel to Asia and Europe to provide a demonstration and negotiate
agreements to develop and license products based on our technology.ï¿½
However, due to cost, the displays will take time to
be adopted into the consumer market and so we have to seed the market in an
area that will support the higher initial costs. This is being done in markets
which can take advantage of what we have to offer, such as satellite imaging,
film post production, military, medical imaging etc.
What then becomes really interesting is the change to
16-bit image processing, which will happen over the next few years. We are well
positioned to take advantage of this shift and have already developed
technology that covers the whole image pipeline from image capture, to storage,
processing and display.ï¿½
I think that is three thoughts, so my mind must be
Q: What are the applications for your technology?
A: Two applications: If you have data that is greater
than you can display on a regular display then we are idea. The film post
production industry is a good example. Film is much better than your
television, but when they do the special effects they use a computer monitor to
develop the content. When they merge the special effect with the film content,
mistakes can be made due to the lack of performance of the display. These
mistakes can be expensive ï¿½ a $100,000 to reprint a scene from a film.ï¿½
The second application is emotional ï¿½ it looks better.
This is an ideal consumer application where people can see a better product.
Q: Your commercially available DR 37P, 37-inch high
dynamic range (HDR) LCD panel was anticipated to be released at SIGGRAPH 2005.
Who will be buyers?
A: Our early customers include the large display
companies who form our partners for commercialization, and those with specific
need. An example in the film space is Technicolor and in the consumer
electronics space is Sharp.
Q: When do your forecast your technology to be at a
price point where itï¿½s available to the mass market?
A:ï¿½ It will take
2-3 years for the product to be available in the high end of the consumer
market place, and will then work its way into more and more affordable
Q: Richard, thank
you for taking the time to do this interview and providing a glimpse into the
processes and challenges for a technology innovator.
A: It is a