Startups Weekly Round Up – 20 February

Welcome to Startups’ Weekly Round Up, where we bring you the latest headlines to keep you in the loop with everything that’s affecting the startups industry in the UK.

The highlights this week:

• Scotland’s First Minister Nicola Sturgeon announced her resignation. What legacy is she leaving SMEs?
• High street banks cut lending to SMEs as demand for finance grows
• UK slides down the entrepreneurial ecosystem rankings, taking the 25th position out of 51 countries
• Further RMT rail strikes announced for March – what can your employees do?

Some Stats to Start Up Your Week

• 27% of business leaders are regularly feeling burnt out at work and 88% believe automating admin would make them happier and more engaged.
• Nottingham has been named the UK city with the lowest annual salary, averaging £22,230, which is £15,000 less than Guilford, the city with the highest average salary.
• 72% of SMEs still don’t view the PSTN Switch Off as a high priority despite being warned about the impact of failing to switchover before the 2025 deadline.
• According to the ONS, the Consumer Price Index saw a drop from 10.5% to 10.1%, indicating some alleviation of high inflation. However, a rate above 10% still remains a problem for businesses

11 Downing Street and the UK Economy – What should startups know?

👶 Sunak’s U-turn on childcare → more workplace flexibility is required to adjust to the Prime Minister’s hesitancy to implementing more supportive child care measures, noted UKG. During Liz Truss’s short-spelled administration, there was more goodwill to support parents by reducing the cost of childcare and offering free child care support for 20 hours a week. However, these plans have been indefinitely shelved, putting parents in a costly and uncomfortable position.

Businesses should therefore look for ways to support them. Nicole Bello, Group Vice President EMEA at UKG, said, “Times are undeniably tough for businesses and their staff, but the organisations that prioritise the needs and wellbeing of employees will be rewarded with loyal and engaged personnel for years to come.”

💰 Tighter wallets → New data from iwoca unveiled there is a growing SME finance gap as high street banks fail to meet rising demand.. 82% of brokers reported a reduced appetite from major banks to fund SMEs and 84% reported their SME clients are concerned about their business surviving increased energy prices.

🛑 Insecure working conditions are on the rise → GMB Union has accused the Sunak government of presiding over a ‘tidal wave’ of insecure work, after zero hours employment hit its highest rate in history. Statistics show that 1,133,441 people were employed on a zero hours contract in October to December 2022. This was the highest estimate on record and an increase of 8.5% on the previous three months.

Gary Smith, GMB General Secretary said, “This Government is making history for all the wrong reasons. Zero hours contracts are a key part of a broken employment model in sectors from social care to retail. It’s time for a government that will fight for workers’ rights.”

📉 Slide in entrepreneurship → the UK is ranked at position 25 of 51 on the quality of its entrepreneurial ecosystem, according to the new Global Entrepreneurship Monitor (GEM). This represents a slide down from position 18 last year. Professor Mark Hart, Lead of the GEM UK team, said, “It’s not surprising that framework scores worsened over the year given chaotic trading conditions and supply chain blockages, as the implications of Brexit continued to be multiplied by the aftermath of the pandemic and compounded by rising energy prices.”

Sturgeon is stepping down – what did she leave behind for SMEs?

Nicola Sturgeon, First Minister of Scotland and leader of the SNP, unexpectedly announced her resignation on Wednesday, claiming, “In my head and my heart, I know that time is now.”

Defining her legacy is a difficult feat, considering her fluctuating relationship with the business community and incessant support for Scottish independence. SMEs sit on a wide range of opinions when trying to understand what she’s leaving behind for the industry.

Dr Liz Cameron CBE, Chief Executive of the Scottish Chamber of Commerce, said, “Regardless of political persuasion, we can all agree that the First Minister has been a committed, dedicated, and passionate public servant for Scotland.

Sturgeon leaves Holyrood as ICAEW’s Business Confidence Monitor for Scotland placed business confidence at -27.8, the lowest score since 2009 and the second weakest in the UK.

Ryan Crighton, Director of Policy and Marketing of Aberdeen & Grampian Chamber of Commerce opined, “For all she has sought to do right by Scotland, I think it is a fair criticism to say she has been tin-eared to the concerns of businesses, particularly in recent years.”

Regardless of the political positions and opinions of Scottish entrepreneurs, there is an agreement within the industry that her successor should look to support small businesses as they face a bitingly cold economic winter.

Disruption on the tracks: how can you adapt to the March rail strikes?

The National Union of Rail, Maritime and Transport Workers (RMT) Union 40,000 members will strike on 16 March, creating yet another day of commute disruptions for employees and employers alike. Both rail workers and bus drivers have chosen to strike due to wages failing to keep up with the cost of living crisis. Overall, two million working days have been lost to strikes since June last year.

The continuous change of plans for commuters is making us question not only how to adapt, but whether the ‘daily commute’ is now a thing of the past. According to ONS data, 29% of today’s company employees and 40% of sole traders report engaging in home only or hybrid working.

While to some hybrid working is a welcome luxury, to others it is essential to have employees in the office, particularly to those in the hospitality sector. How can you circumvent strikes and get your employees to clock-in in person? Smart transport.

Zeelo, a platform offering enterprises access to a ‘smart bus’ transport solution, offers a tailored commute solution for businesses trying to adapt to the strikes. The company’s AI-enabled technology locates the most efficient transport routes, making it much cheaper and quicker than driving a car.

Sam Ryan, Zeelo CEO and cofounder, said, “The commute needs to be tailored, comfortable, reliable and safe. Public transport doesn’t cater for this.”

Funding Opportunities

Global climate tech accelerator Subak is offering £130k grant funding to 14 not-for-profit climate startups across the UK, Europe, and Asia Pacific. Subak has already funded and scaled 15 startups who have raised £13M in follow-on funding and achieved significant consumer and policy impact. You can apply here. Applications close on 17 March.