Finding the missing ingredient to make an entrepreneurship haven
Venture capital boss James King (second left) on introducing government incentives for picking winners
In the US, starting your own business is encouraged as part of the “American Dream” culture: that everyone has the right to succeed if they work hard enough.
Both investors and those who start the companies are equally valued but crucially failure is accepted too, or even welcomed as a guide for future success.
Adopting more of the US approach to entrepreneurship could help realise business potential here in the UK.
Unless it’s sport, we seem to have an uneasy relationship with success but we need to do more to celebrate our successful entrepreneurs here, and create an environment where everyone involved is fêted – not just the celebrity few.
Of course, culture isn’t created by legislation and it isn’t changed overnight. It’s far more organic than that. But having the government focus on the things that really help entrepreneurs is a necessary and positive step.
Put grants in experts’ hands
The government has plenty of grants available for new start-ups. However, governments are not in a position to hire people with the most relevant skill sets to make the most profitable investment decisions.
It isn’t the government’s role to pick winners or hire venture capitalists. Its role is to create an environment that accommodates that expertise.
On the other hand, it is the job of hedge funds, pension funds, money managers and company founders to spot the opportunities out there.
Governments should incentivise people who think like professional investors, rather than trying to hire them. That would put grants in the hands of people who know business and understand risks – and are prepared to take them.
Investors that grow employment or secure a return on their investment would get prestige and perhaps even tax breaks – with the added benefit that grants become more widely publicised and applying becomes much, much simpler.
Unlocking a successful future
Starting a business is not easy. From first-hand experience of setting up businesses and through my day-to-day work at FIG, students and young entrepreneurs need a clear and pragmatic route to finding the right investment and support.
In the current climate, starting a business may seem like an attractive idea but it is important to remember that it is not for everyone. Not everyone has the right skill set to start their own business and people shouldn’t be led to believe they can.
Start-ups are scary, stressful and time consuming. That said, those that do, should be given the chance to flourish.
Through its initiatives such as the Start-Up Loans scheme and the Growth Accelerator programme, the government is making great strides but it must continue to work with its commercial partners, administrators and regulators to nurture the community of established businesses, start-ups and entrepreneurs it listens to. This is key to unlocking a successful future for British business, today.
To read earlier articles in this series click on the following links:
Article one: Let’s unlock UK universities’ entrepreneurial talent Article two: 5 ways to get money into and out of fledgling companies Article three: Educating for business: How to ensure a better return on investment
James King is the managing director of Find Invest Grow (FIG), a venture capital firm set up to back businesses started by students and graduates. www.findinvestgrow.com
To read FIG’s manifesto visit www.findinvestgrow.com:the-fig-manifesto