20% of UK businesses fail in their first year. 1 in 3 businesses fail within their first 3 years. So why would anyone start up a business and how do they succeed?
Well, it’s not as gloomy as the figures suggest as between 2000 and 2012 the number of SME’s (small-medium enterprises) set up grew by over 38% to around 4.8millon. Perhaps this shows that entrepreneurs are being more pragmatic and realistic by keeping their companies relatively small to begin with. Our 10 tips to improve any business is a useful starting point.
Many new business start-ups are social enterprises, which are businesses whose primary aim is to make a positive difference to social or environmental issues. Two good examples of the UK’s 55,000 social enterprises are The Big Issue and Jamie Oliver’s Fifteen, in which he trained young, unemployed people from disadvantaged backgrounds. The majority of profits from social enterprises will be invested back into their social cause.
Social Enterprise UK is the national body for UK social enterprises, and represents their interests and helps them to grow. Annual membership costs £75. There is also an increasing amount of funding opportunities for social enterprises in the UK.
Accelerator schemes are increasingly popular for new businesses looking for a jump-start. These schemes tend to last several months and are an intensive fast-track to get new businesses ready for the marketplace. Mentoring, pitching practice, workspace and initial investment is provided, in exchange for a small amount of equity. These schemes are competitive and applicants can expect several interviews, pitches and proposals before they are successful.
Seedcamp was the first UK accelerator scheme and a host of others quickly sprang up. This nurturing and risk-decreased environment led to around 520,000 business start-ups in the UK last year. These schemes provide a stimulating atmosphere and participants are thrown together to allow them to learn from one another. It is crucial that you thoroughly research the accelerator schemes available to find the best one for you. The most well-known ones won’t necessarily be the best for your business. Speak to alumni from accelerator schemes to find out how far they’ve progressed since finishing the scheme.
Most accelerator schemes will end with demo day, where you will pitch your business to a room full of investors. While this will be a great opportunity, investors are unlikely to invest large amounts of capital purely based on a pitch. This is the starting point and you should expect a series of meetings, pitches, and proposals before any investment materialises. You also shouldn’t have been waiting passively for demo day. Throughout your scheme you should be entering all relevant competitions and funding opportunities, whilst networking with the other teams and the mentors. It’s impossible to know who will be able and willing to help you, so make the effort with everyone.
At Collaborative Media we produce engaging films for clients across all industries, so if you’re now looking to take your company to the next level- get in touch. Our programmes are broadcast on Sky TV to a large business-focussed audience.
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Written by Martin Stocks | @Stocks1986