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Finance Failure to Fund Success

11 days ago by Robert Wilde

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The scene was definitely set when the ministerial visit to Business Growth Hub kicked off with the Chief Secretary to the Treasury posing what she described as a couple of cheeky questions.

 

Firstly, Liz Truss wanted to know about Manchester’s greatest failures, recognising that to be really successful you had to "cock up," and secondly she challenged those assembled to explain how we measured productivity.

 

This of course did not faze those businesses that were seated at the table with her and Margot James, Parliamentary Under Secretary of State at the Department for Business, Energy and Industrial Strategy. We were invited to meet the ministers because, having benefited from what Business Growth Hub offers, we were the success stories. And of course, with the exception of one brave soul, no-one wanted to linger on past tragedies!

 

But for me, the question of failure was the most important point addressed at this meeting. Ms Truss believes that Britain’s biggest criticism is that we’re scared of failure. I don’t entirely agree.

 

The UK is ranked third in the world by the Organisation for Economic Cooperation and Development for the number of startups created. But we tend to then sputter out, ranking only 13th for the number that go on to become established medium-sized companies.

 

This would suggest to me that we’re a pretty brave brunch; entrepreneurial blood seemingly flows in our veins. Where the problem lies is lack of access to financing as a business matures. Absolutely, there is likely a need to produce better business plans, have a long-term plan in place to address growth, but these good governance skills fly in the face of entrepreneurship. So startups founders need to be equipped with the level of management skill that delivers ‘grown up’ plans and teams that will attract future investors. And this needs to be delivered by unbiased, equally invested people. Which is where Business Growth Hub comes into its own.

 

Having access to Growth Hub’s framework, which offers the level of business support required to support a startup as it seeks to attain the next level in its lifecycle is crucial. So is the Growth Hub’s pragmatic view [and answer to Ms Truss] that not all startups will attain success, so they [Growth Hub] will have to finance failure in order fund success. Government needs to continue to underpin this approach and so, Ms Truss, when you say Britain fears failure what you actually mean is that perhaps it’s Government who fears failure.

 

 

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Image: Heads of successful growth businesses at Business Growth Hub with Margot James MP and The Rt Hon Liz Truss MP.