Academic achievement must go hand in hand with an entrepreneurial mindset

30/04/2015

The next three months will see universities churning out thousands of very proud new graduates – BA Hons, BSc’s the lot. A great education with brains packed full of new learning, knowledge and facts. But why do so many fail to find a job? How many of these bright new graduates have had their prospects limited by the conditioning of the external environment? These young adults have been supported in life skills and getting their head in shape for the next stage of their life. How many walk away with a personal growth plan that defines very clearly how to move their life on and make the best of their three years spent at university? How many have thought creatively about next steps… charity work, setting up their own business, free lancing using specialist skills they have acquired?

My view, is that we have some of the best academic institutions in the world and we create some of the finest talent, but so many never realise their potential and end up in jobs that fall way below their true capability – futures that lack direction, bouncing around from one job to another. It’s no use having a long list of qualifications if you don’t put them to best use. More effort and energy should be put into developing the creative and entrepreneurial mindsets that drive ambition and ultimately greater achievement. If you cant find a job why not create your own and set up in business? We need to see more graduate entrepreneurship.

I speak from experience, I left university in 1986 with a degree in Chemistry – great technical skills, but struggled having conversations, making presentations and generally selling myself to potential employers – no skills for life. I am not sure much has changed to be honest – I had to work it out for myself. We need to equip this next generation with a more rounded experience thereby allowing them to combine great academic qualifications with a mindset conducive to achievement and releasing personal potential. We must remember that we get what we think about. The universities are a rich seam of next generation entrepreneurs, work is needed to getting them started.

Are the cap and gown, the photograph that hangs on mum and dads wall and the handshake from the university chancellor the best send off we can give them? As well as the well-earned degree certificate, they should all leave with a “plan for life” or maybe a plan for their own business.

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Spinouts – Scaling Up

26/01/2015

This blog was written for Spinouts UK Quarterly Journal 2015. You can join their distribution list by emailing research@ycf.co.uk

Most spinout companies from universities have the ambition to be companies of scale. If they are to win significant investment at an early stage, they will need to demonstrate that they have a ‘road map’ to enable them to establish a strong position in their chosen market.

However, this ‘road map’ passes through different stages, each of which places different demands on the company founders. Initially, the spinout founders will be immensely relieved to have completed the spinout process itself, with the knotty issues of IP ownership, and the relationship of the academic founders with the university. The next stage is generally one of spending (on prototypes, clinical trials, and other proofs of technology) rather than selling. As a very broad generalisation, academics in spinout companies are more comfortable with the ongoing research and development (which is in many ways similar to their academic work) than in market analysis, recruitment and team building, or the management of premises, financial records, and all the other administrative tasks which are essential to get a startup company on its feet.

The next stage is growth. For all young companies, whether spinouts or not, there are natural barriers to growth. Winning Pitch identifies the most important of these as the emotional cost and the financial cost.

The emotional cost to the individuals involved is usually manifested in self imposed pressure, and in the uncertainty that demands resilience and mental toughness to keep going when the inevitable road blocks are presented.

A scale up company is defined as one that grows its employee or turnover at a rate of 20 per cent per annum over a three-year period, and the financial costs of doing this can rack up very quickly – the cost of recruiting new talent, and of raising finance, professional fees, new premises, IT infrastructure and administrative costs can shoot through the roof. Costs must be controlled and the execution of a growth plan needs to be effectively choreographed – clear roles need to be defined, people need to be accountable for delivering on their tasks. Very rarely can growth be achieved without impacting on profitability.

This is why the majority of the 500,000 of last year’s new startups will never go on to employ one person never mind 10, and also why over 99% of UK firms employ fewer than 50 people. Very often it’s the financial cost of growth that holds individuals back.

What does this mean for academics spinning out a new company from a university?

The main point to recognise is that no one entrepreneur can build a business alone – it takes a team, combining the different skills needed to grow the business. The second point to recognise is that as the team grows, different leadership challenges emerge as the culture of the business evolves. At Winning Pitch we refer to the ‘growth staircase’, with different challenges as the number of staff increases. When the company reaches 7-12 people, the entrepreneur has become an ‘entrepreneurial social worker’. At 25 or more people, the business culture becomes ‘the team vs. the mob’. With 50 or more staff, the business needs to evolve towards a corporate culture, where processes need to be standardised and continually improved, with less scope for individual innovation. Individuals who can take a company through all these stages are rare indeed, and academic entrepreneurs do well to realise that at some stage in the company’s development, the business will be best served if the reins are handed over to others with practical experience of running a large and growing company.


Lloyds TSB Enterprise Awards

01/03/2012

The banks have had a bit of a kicking over the past few years. However, let’s be fair and look at some of the great things they are doing. Earlier in the week I was fortunate enough to judge and speak at the Lloyds TSB Enterprise Awards – an initiative designed to seek out the best university students and graduate entrepreneurial talent. It was an inspiration to listen to young people with ideas and the motivation to build a business rather than go down the traditional route of trying to find a job.

Universities have an important role to play in preparing individuals for the next stage of their career, equipping them with the ability to write a 5,000 word dissertation is just not enough. Conditioning graduates to consider the option of setting up their own business is vital – is it any riskier than trying to find a job? probably not!

The young entrepreneurs I met, had ideas, put them on paper and then rolled them out – they were generating revenue and jobs. The winner of the Best Enterprise, Adam Soliman of Charbrew was a top lad, his head in the right place. The Best Start up – Peter Van Neste of Stagetex had a clear handle on his sector and the finances of his company.

The reality was, all of the finalists were high performers and an inspiration to other graduates, more specifically the finalists :

-had clarity of what they wanted to achieve

-were innovative and displayed an edge

-displayed the invisible forces of passion, hunger and determination

-lived in their customers world

-had a grip on the importance of finances

The finalists must be showcased – they are role models and an example of what can be achieved if you just get your head around the idea of being your own boss. Come on universities wake up – Lloyds TSB, great, you have clocked the potential of graduates and their ability to create and generate wealth!


Universities have much more to give

29/06/2011

As a Nation we should be extremely proud of the contribution our Universities have made to the progression of science and knowledge and our educational prowess is both respected and recognised throughout the world. Whist this maybe the case, there is no avoiding the need to cut costs, a fate that other public and private sector organisations have failed to escape. Plugging the budget shortfall and creating financial game plans to secure long-term sustainable futures have become of paramount importance to senior university managers

The one advantage which universities have that others don’t is the rich seam of potentially commercial propositions these span the spectrum of patents and licensing, through to revenue streams created through consultancy, R & D collaboration and spinouts. However commecialisation still remains a relatively low priority for university faculties. At the extreme some senior academics frown upon entrepreneurial forays with many sensible suggestions dismissed at infancy. A mindset change is needed and when costs are being cut plausible options of how to secure revenue from the commercial realisation should be investigated. For many academics seeing the application of their research in practice is a significant motivator, more needs to be done.

The Government has made it clear that transforming research into innovation is a priority and whilst UK universities have a strong record more needs to be done. This involves building stronger links between the UK’s science and research base and the business community, to create more spin-out companies, consultancy projects and research-funded programme

For this to happen a fundamental change is needed in promoting an entrepreneurial culture. In all fairness academics are not trained or prepared for the life of commerce. Very few have the unique mix of business and technical skills. Setting up a venture or selling knowledge and expertise is far more than creating a business plan – it requires attention to a broader set of softer skill which cant be taught, however they can be coached. Is it time for change?


Universities need to pick people not just technology

30/07/2010

There is an increasing need for universities to find revenue through commercialisation of knowledge, IP, R & D contracts, licensing…. I think going forward the universities need to put as much emphasis on identifying those academics with a burning desire to get out into the market place as they do on the idea itself. All to often I see academics being cajoled into becoming entrepreneurial with their ideas or  enterprise units of HE  trying to make business people out of individuals who just have not got it. Whilst I believe entrepreneurs are made not born – some are harder to make than others!  – fundamentally if someone does not want to do something or you cut across their fundamental beliefs then change is extremely difficult!

I would like to see HE spending more time on the person and not just focus on the “commercial idea” – scouring the faculties and departments for individuals with the drive and ambition to generate revenue needs more time, effort and energy.  At least HE are then pushing against an open door! As I have said before lets look at humanties, social sciences and other non scientific departments for ideas as well!


Commercialisation – IP alone will not create revenue

19/06/2010

There is so much talk about universities and the role they should play in enterprise and commercialisation. Over the years I have been around numerous universities – lots of science, engineering and technology based faculties. The amount of IP and knowledge as well as the talent, never ceases to amaze me . Protecting ideas is such an important element of the commercialisation process – I would never disagree with that – but a patents alone wont make the till ring!

Too many academic establishments think the job has been done when they have got their patents sorted. Well I think there are three things pivotal to taking ideas to market:

1. The commercial drivers (CD) – what is the route to market/customers – business model – who’s going to buy it?

2. The human factors (HF) – thinkers, drivers, doers, sellers – getting things done through people and teams

3. The resources factor (RF) – money, time, IT, plant, equipment

In simple terms successful commercialisation is a product of CD x HF x RF – score zero in anyone and it does not happen. I have broken this very simple model down into sub components and would be happy to share them with anyone interested. The fact is anyone involved in  commercialisation should view the process in more holistic way – its not just about IP, its far broader.


High Technology and Innovation to Drive Growth

09/06/2010

An article in the Financial Times on Monday (7thJune) reviewed the latest NESTA report on the importance of high technology and innovation in economic growth. A couple of observations I have based on experience and indeed research we have conducted ourselves. Firstly, the UK has seen a significant amount of cash being poured into incubators over the past ten years – these are purpose built offices that nurture the growth of knowledge based companies. In certain areas these places have become a hot bed for new entrepreneurial talent in others they have bombed. High technology entrepreneurs by very nature of their being have sound functional skills but all too often they lack what I call customer connectivity – in other words they struggle with selling! If high technology is to be a route to economic growth then either the entrepreneur or someone in the team needs to be able to sell – this is a void I see so often – the resultant effect is that companies stand still and fail to move on at the pace they should be doing. NESTA need to bear this is mind when they push out their strategy pieces – high technology by itself without customer connectivity is a waste of time – that’s why so much of university IP ends up sitting on the shelf

Second point is that traditional and longstanding companies can be high growth not just start ups– they can reinvent and do things differently – some embrace technology others form partnerships and lots focus on building their brands!

The process of building a “Fusion mindset” is vital – connecting unconnected areas to create a new customer experience. Here are some examples:

  • Lucazade the dying brand in the 80’s reinvented from medicinal to sports drinks – they fused the personality of Daley Thompson Olympic gold medal winner to their new isotonic drink
  • Innocent drinks – built a high growth business on their brand and personality (nothing new about drinks in a carton)
  • Liptons tea partnered with Pepsico to create canned iced tea
  • Fit.me – fused fashion retailing to bio robotics and created an online fitting room experience

High technology in its own right won’t do the job – it’s the application. This must be supported by passion, drive, great sales and marketing, strong leadership and discipline.   This is what gets the result!