If the United States were not in the picture, the UK would be the number 1 place for start-ups. It’s a revolution here with no near end in sight. In 2015, 608,000 companies were established and a year later, that figure rose to almost 660,000. And yes, you can expect the figures to be higher for 2017.
When there is such phenomenal growth, there is a tendency for people to want to attribute it to something. In this case, many believe the government has played a significant role. Particularly the initiatives set up in the aftermath of the 2010 financial crisis to encourage entrepreneurs to launch their start-ups. Launched in 2011, StartUp Britain was supported by the coalition government and owners of SMEs benefitted from tax breaks as did investors.
We can go on and on about how the start-up ecosystem has gotten to where it is now, but the more important question is ‘where do we go next?’ At what point is a start-up expected to shake off the ‘start-up’ tag and scale up?
Many are of the opinion that the country is not doing enough in terms of making sure new businesses actually grow and become solid. After all, what’s the point in starting hundreds of thousands of businesses if most of them end up failing? The UK needs to do everything possible to ensure that as many start-ups as possible remain standing after the initial turbulence that every new venture must face and grow into thriving businesses.
It is only when you look at the figures that you’ll see how deep the problem is. According to research, no more than 3pc of start-ups are in the category of those that enjoy a single year of high growth as well as survive for a decade.
At the heart of solving the problem is gaining knowledge from every relevant source available. There are businesses that have grown in terms of staff and turnover over a sustained period and younger businesses must learn from them, even in the simpler matters like the right cloud hosting to get. But of course, hosting is not such a simple matter, especially for businesses that depend on it to survive and thrive. There is also quite a bit to learn from other countries that see many of their start-ups grow into scale-ups.
Thankfully, many are aware of this challenge and some are doing what they can to help. Over the past year or more, we have seen government, academia, business, and financiers take action to get rid of hurdles that could impede the growth of promising enterprises.
It is good that both the public and private sectors are genuinely interested in the ‘start-up to scale-up’ movement. Existing support schemes are being expanded and new training courses developed. These are fantastic, but more needs to be done and it involves learning and applying new knowledge effectively.