Accelerator not for startups, but for SMEs – SMEs with high potential and in manufacturing and engineering: a short and sharp bootcamp that helped the companies involved to re-examine their strategies for growth suggests that ‘Accelerators’ have widespread and as yet unexploited potential; and raises important questions. Why was it not seed-funded by Nesta, the TSB or BIS?
A lot of interest has been aroused by the running of a 2-day bootcamp for hi-growth manufacturing companies by an angel group. Accelerators tend to be focused on IT-based ventures – where results can be achieved relatively quickly, while rather longer incubation periods seem essential in projects in healthcare, and (less surprisingly) in bioscience.
Qi3 Accelerator, a group of 18 angels specializing in manufacturing, which has evolved a process for supporting young businesses, has recently completed a 2-day intensive Bootcamp – a development programme for six High Value Manufacturing and Engineering companies across the UK. Unlike Accelerators in IT, they share fewer common aspects or issues that might enable them to learn from one another, but they all shared prospects and they all had a strategy.
They were selected by means of a competition – both for their potential as companies and for their potential to benefit from the process. The main objective was to help the teams become more attractive to investors by developing their strategies for growth.
Before they came together, each had to complete an analysis document – a rigorous investment-readiness assessment, whose aim was to pinpoint their issues in terms of where they were at that moment and what their aspirations were. On arrival each team had to pitch to the others, and then they had to do so again on the final day, thus high-lighting the progress they had made.
Each team was assigned a coach, one of whose roles was to identify those mentors who might be of greatest help, firstly in the view of the participant and secondly in view of those mentors who felt they had a particular contribution to make to that team.
The participants worked with mentors and coaches in a series of workshops, where professional guidance and hands-on experience was made available. “The breadth of expertise on offer was exemplified in the short, sharp mentor group sessions in which different strategy elements could [be pitched], to be tested and either discarded or refined into a more compelling whole.” And such topics as market research and business development also came under the spotlight.
At the end, Qi3 Accelerator made awards for the Best Performing Company and the Most Improved Company. The substantial cost of this exercise, which involved nearly a hundred people, was underwritten by Qi3, with funding from IdeaSpace and commercial sponsors, and support from Nesta and the Technology Strategy Board. As I write, Qi3 Accelerator has revealed that it will soon be able to announce an £800k deal for one of its incubatees.
The initiative has attracted interest from the Cabinet Office down; and Qi3 Accelerator recently won the UK Business Angels Early Stage Team of the Year, 2012 Award ‘in recognition of their novel business model, their staged evaluation process, the scale of the deals they have led, and the extent to which they support companies in which they invest’.
I know of no comparable support programme in the UK, but there is a significant networking programme for small business in Belgium (called Plato), set up 20 years ago, under which small groups of carefully matched SMEs meet regularly to learn from each other’s experiences. It was originally set up by the East Flanders Chamber of Commerce, and has always had consistent government funding; and it now functions not only all over Belgium but it has also been introduced into a number of other countries.
An exercise like this is a risk – for any VC funder, angel group or science park, yet this, the first of its kind appears to be successful – both in terms of what was then achieved, and hopefully in financial terms too. The risks are about whether an investor or a group of investors can assemble the expertise to run such support (most of those with experience of running happenings like these are already busy running Accelerators); and can justify doing so.
Perhaps a few more such successful experiments would get some early-adopters into play; and the TSB is keen to support clusters, like the opportunity Nottingham City Council seems to represent, and perhaps Newcastle’s Science City and the concentration of expertise that makes Bristol so vibrant, or Manchester, or Edinburgh.