A Venture Capital company runs its own Acccelerator

Aside

Venture capital company runs its own accelerator

Activate Capital is running an accelerator programme in Ealing, London over a six week period – it’s ‘digital startup studio’. It includes strategy and planning, product design, advice on company structure as well as pitch coaching for future funding rounds.

It aims to focus on the needs of individual startups, with specific topics addressed each morning and afternoon in a structured programme, tutored by the eight principals of Venture Capital business (founded in 2016).

Startups contribute up to 5% of their equity; and once the programme has finished, successful applicants have the opportunity to gain access to seed investment of £100K, to optimise product development and secure future finance.

Activate Capital claims to have invested in three companies last year. Their concern is that the average success rate in Accelerators is one in ten and they are seeking to ensure that all of those that go on their programme succeed. “We are committed to working hand-in-hand with start-ups to ensure that they get the advice, insights and support that they need.”

John Whatmore, March 2017

 

 

A venture capital company that knows its onions – because it grows them

Aside

Sovereign Capital runs its own academies – in the music industry

I’ve just come across an unusual set-up in the innovation eco-system: a venture capital company that runs its own academies for startups; but would you believe this: one of them is for song writers! It is as though a VC in Bioscience had set up its own entrepreneur school for potential CEOs in synthetic biology.

But why not? Song writing and bioscience used to be callings which had their own very specific origins, but both of which now demand business nous.

What is being taught? Isn’t songwriting something “you’ve either got…or you haven’t”; “they just come to you”, said one successful writer. But the pedagogues at the Institute of Contemporary Music say that popular musicians hide the fact that they have had to study their craft; that there are elements of songcraft (just as there are in creative writing) that can be taught – like where to put in a middle eight or a key change; and individuals can be introduced to writer’s works that speak to their own work. ‘We provide tools and a regime of learning and development – about production, performance and business.’ (See the video ft.com/rockschool.)

Importantly, students are helped to develop their brand and to monetise it – for example by making contacts. When they are ready, they get introduced to potential managers, publishers and labels. There are lots of panels, with guests from the industry – talking about digital marketing, how to analyse data, the demo-graphics of your potential fan base, and of course contracts; and there are regular Master Classes.

“We used social media to find out where people were listening to us, and where our potential market might be going”, said one band that had just organised a tour.

If programmes like this, which provide aspiring musicians with a variety of routes to using their talents in the music industry, are more common than they used to be, the presence of a venture capital group is a great deal less so. Sovereign Capital, ‘the largest and leading provider of contemporary modern music education in the UK and Europe’ (which inter alia owns the British and Irish Modern Music Institute with its branch in Fulham,) is described as a big player in this sector with some notable and much trumpeted success stories to its credit.

The recent Barclays Scaleup Report emphasised the importance of expertise in venture funding. There can be few better ways of developing that expertise than in having an organisation whose essence is the development and commercialisation of talent.

John Whatmore, March 2017

 

A bespoke programme for private SMEs

Aside

A bespoke growth programme for ambitious private companies.

ELITE is a platform of unique provenance designed to help the UK’s ‘most exciting and ambitious’ private companies prepare and structure for their next stage of growth.

Launched by the London Stock Exchange in 2014 and delivered in collaboration with Imperial College Business School, this programme – for the UK’s hi-growth private companies – is a veritable hothouse for growth.

Like other such programmes about which I have written recently, it is an extended programme of periodic meetings – this one an eighteen month, three part programme, consisting of education, discussion, business support, mentoring and access to entrepreneurs and business leaders as well as to the corporate advisory and investor community.

In the UK it comprises two cohorts a year, each of 15-20 companies (chosen for their growth potential) – the seventh cohort just starting; and involves seven modules of intensive meetings at the London Stock Exchange, each of one to one-and-a-half days, every eight weeks – normally for the CEO and the CFO.

The dominant theme is (not unexpectedly) capital. Other main themes are: strategy, talent and other key resources, governance, marketing, and packaging one’s story.

Get ready This section – of 8-days broken down into four modules, is aimed at providing participants with the operational skills –initially to review and reflect – about visibility, productivity and efficiency, and about cultural and organisational change.

In the Get Fit phase, all the suggestions and guidelines raised in the first phase are put into practice. Using a self-assessment test, the company can identify the areas for improvement to work on, and have the support of a group of professionals tailored to the specific needs of the company to consider how to embed changes in the business.

 Get value With the help of a select community of investors, professionals and companies, the participants will be engaged in initiatives for moving forward, such as exploring new funding options and new business opportunities – designed to boost the brand and ranking with investors, suppliers, customers and other stakeholders.

The ELITE programme was first implemented in Italy (where it also runs) in April 2012 and has now expanded all over Europe. Some 500 companies have participated in ELITE programmes across Europe, with an advisory and investor community of over 250.

John Whatmore, November 2016

 

How do other programmes compare?

All ‘scaleup’ programmes tend to be for small groups of senior executives in SMEs; they focus on key aspects of growth, and are structured for mutual discussions plus input from experts – at regular, usually monthly meetings over twelve months. (The following have all appeared recently on my website, http://www.johnwhatmore.com)

The Judge Institute’s SME Growth Challenge – a series of six bi-monthly workshops for CEOs of about a dozen hi-growth SMEs, delivered over 12 months – aims to develop each firm’s managerial capability.

The RBS/UCL Growth Builder programme is a 12-month programme for 48 growth companies to meet monthly, alternating between the provision of input and small group working, with meetings rotating around the premises of the numerous and various contributors.

10,000 Small Businesses is a programme offered by 5 UK universities for cohorts of c70 SMEs to develop growth plans. They meet together – in three separate session, each at a different location, with online learning between those sessions, and over the course of 30 days.

Plato, started in Belgium and now widely franchised throughout the world is for groups of c.15 senior executives from matched small companies – to meet regularly – each group with a couple of mentors from large companies – to support and help one another with their current issues.

Vistage, originating in the US, puts together groups, each of about a dozen senior executives in SMEs in the same local area, matched as far as possible. Meeting on each other’s premises, monthly or bi-monthly for a day at a time, they focus each time on the work of two or three members of the group.

‘ella forums’ is a leadership development programme designed to inspire growth in social enterprises, in which CEOs come together for monthly sessions, where they hear the latest thinking from guest speakers, share best practice, and receive coaching from experts.

 

 

Attracting SMEs to the UK

Aside

Bringing leading young businesses to the UK The UK’s attractive Sirius Programme has a new format and a new (private sector) management 

The Sirius programme aims to bring some of the best young entrepreneurial talent from around the world to the UK where they can build their businesses for the benefit of themselves and the UK economy. Participants receive a complete package of services to maximize their potential for success – probably better than any UK young business could expect.

The package includes seed funding of approximately £35,000 plus 30-days of acceleration training, mentoring, twelve-months office accommodation and support in obtaining visas from a dedicated Sirius allocation. The total package is estimated to be worth up to £60,000. Companies participating will cede a 10% stake in exchange for the support received.

Sirius was developed originally by the then UK Trade and Industry (UKTI) in 2013 to promote the UK as a destination for young entrepreneurs, and to date has attracted over 2,300 gifted and ambitious applicants from 93 countries, leading to 73 companies coming to the UK. The programme aims in the future to attract up to 100 entrepreneurs representing 40 new companies to the UK each year; and these will be spread across different regions of the UK.

Management of the Sirius Programme has been transferred to a consortium of private and charity sector organisations to facilitate its growth and development. The consortium includes The Accelerator Network, Entrepreneurial Spark, NACUE, Natwest (part of the Royal Bank of Scotland Group), The Rain Gods and White Horse Capital.

The support programme is to be run on a not-for-profit basis and seed funding for the start-ups will be sourced from UK private investors under the Seed Enterprise Investment Scheme (SEIS), with the expectation of a strong investment return given the calibre of international start-ups and the support they will be able to access in the UK, now including investor input.

Timothy Barnes, Chairman, Sirius New Direction Ltd commented (3 Nov), “The development and growth of the Sirius Programme underlines our confidence in the reputation of the UK as a leading global destination for young entrepreneurs. There are some incredibly ambitious entrepreneurs with great business ideas that would benefit from being based here and we are keen to hear from them all!”

He added: ‘It is a highly competitive programme, but with much of the previous marketing conducted outside of the UK it is not as well known within the country as it might be. Teams from anywhere in the world can apply, as long as one or more of the co-founders is from outside of the UK. Overseas students already in the UK as part of their education are particularly welcome.’

Applications for the new format programme are open now via http://www.siriusprogramme.com – the first cohort to be selected before the end of the year, to be active in the Spring of 2017.

John Whatmore, November 2016

The contribution of the “10,000 SMEs” programme

Aside

A small but effective contribution to Scaleup needs

New research shows that Goldman Sachs 10,000 Small Businesses Programme is an effective growth builder, but it makes only a limited contribution to the UK’s Scaleup needs.

For leaders of small businesses from across industry sectors this is a ‘high quality, practically-focused business and management education programme’ during which every small business owner develops a customised Growth Plan to direct their organisation’s business strategy and expansion; and it provides networking and peer learning opportunities.

For the cohort of 70 small business leaders selected to participate in each programme (and there are firm criteria – which do include an indication of growth potential), the three-month programme (offered by five leading UK universities) is delivered over 100 hours. It is made up of ten days of residential learning in three separate sessions (each at a different location) in between which are periods of flexible online learning. Each session features education, discussion and peer-group work to enable individual participants to define their growth goals and pool their experience.

The success of the programme is ascribed to a blend of formal learning, mentoring, and peer-to-peer support, which includes:

  • specialist workshops
  • one-on-one business advising
  • business coaching
  • access to professional experts
  • ongoing support and guidance offered through networking with the resulting community of business leaders.

A just-published survey of past participants indicates that they enhance turn-over and go on to employ more people – more so than comparable businesses in a control group. In line with some though not all of the needs for successful scaling up indicated by the recent Barclays Report, they:

  • introduce new processes
  • use more financial data
  • source new suppliers
  • introduce new training opportunities
  • develop and launch new products/services
  • seek external finance

and above all they

* develop increased confidence.

The latest assessment report focuses explicitly on the successes of the small businesses that it has attracted. But it also ends on what is a sobering note: if the 33,000 other small businesses with profiles like those of the 933 participants to date were to show similar growth, while it would add £4.3bn to the economy, at this rate it will take years to reach just 10,000.

John Whatmore, November 2016

SETsquared tops Trumps

Aside

SETsquared tops Trumps 

The top Incubator illustrates the range of support that can be offered to young businesses.

Karen Brooks of SETsquared, a partnership of five universities centred on Bristol, recently rated ‘Global Number 1 University Business Incubator’, spoke at a recent ‘Knowledge London’ meeting of leaders of university incubators about the six programmes – at a variety of levels in the innovation pipeline and in various sectors – that SETsquared runs; and added that it was all about a mutual relationship with industry – understanding what business wants; and she commented that SETsquared had no academics on its staff.

The most striking contrast, I suggested at that meeting, between Accelerators most of which are branded ‘pop-ups’ (as c.12 week programmes) and Incubators many of which are in universities, is that the former:

  • are more involved with their businesses
  • provide more input and support,
  • have many more contacts with the business world.

But SETsquared is a leader in all of these respects.

At the Pervasive Media Studio at Wastershed, Bristol – a twelve month home to a dozen young businesses, over lunch together on a Friday everyone has to talk about their progress, about which notes are immediately circulated so that teams can meet up to learn from one another’s experience. Jim Milby, until recently a Director of Barclays Bank, who mentors at Startupbootcamp, insists on a weekly review with his team wherever he is a mentor. Paul Miller, one of the authors of Nesta’s The Startup Factories, and founder of Bethnal Green Ventures – a winner of a major grant from the Cabinet Office’s Social Enterprise Startups programme – holds a review once a week with every team in the Accelerator. At ‘Office Hours’, he asks the same questions of each team “What did you achieve last week, what will you do next week, what is stopping you; and what have you learned”.

Accelerators provide more input and support, especially in the form of mentors, notably with specific advice eg on design, potential customers, fundability etc – often in a ratio of four or five to every team. Techstars, Startupbootcamp and Wayra Lab all have around 150 mentors for each programme, (as does SETsquared,) among whom two or three are regularly attached to each team; and Seedcamp has even more.

As does SETsquared, they have many more external contacts with local practitioners, experts and entrepreneurs in businesses in the sectors in which their young businesses are involved, upon whom they can call for specific help. Moreover their leaders are often entrepreneurs themselves.

Incubators are still essentially providers of office space more than they are facilitators of business development, but it takes little (often only a canteen) to encourage their occupants, who are all on the same growth path, to draw from others’ experience and find the essential help that they often did not know they needed!

John Whatmore, November 2016

Support for leadership and growth – in charities

Aside

Leadership and Growth in SMEs

‘ella forums’ is a leadership development programme designed to inspire growth in social enterprises, in which Chief Executives come together for monthly sessions, where they hear the latest thinking from guest speakers, share best practice, and receive coaching from experts.

Where ‘Scaleup UK’, the recent Barclays Report on ‘Growing businesses, growing our economy’ focuses on the will and ambition to grow, it can be argued that that comes down to leadership. ella forums is a leadership development programme for social enterprises and their growth.

Members from the same area come together in groups of 10-12, for a monthly meeting, (to which they commit for 12 months). The meetings are designed to give each individual the tools and support they need to help their organisation develop and grow. The approach is based on learning from experts and from each other, combined with more personal one-on-one support from a coach.

The session is run in two parts. In the first part, an expert talks about their field and how it is relevant to the member’s issues. In the second part, the group discusses in a confidential and non-judgmental setting any issues participants may be facing, to help them resolve problems.

Participants also receive coaching from someone with the right skills and knowledge to address issues and support progress (selected by the group’s chair).

There are monthly evaluations as well as an annual Social Value Report by which the impact of the programme can be evaluated.

‘ella forums’ was set up in 2013 as a Community Interest Company (CIC) – a limited company for community benefit. In June 2014, a partnership was announced, unique in the social sector – with GrowthAccelerator, the service backed by the government and private enterprise and designed to help SMEs to grow, but the government terminated its support for that entire programme in 2016.

ella has been growing and now has fifteen groups in various locations across the country and expects to add ten more in the coming year. Following a 6-month pilot, the Lloyds Bank Foundation recently announced plans to open groups in partnership with ella for beneficiary charities across the country, of which there are expected to be an additional ten.

ella has also set up groups of different kinds: one group for emerging leaders; one group with both charity leaders and corporate leaders; and one is planned specifically for start-up and pre start-up organizations.

ACEVO (the Association of Chief Executives of Voluntary Organisations) runs similar CEO Forums for members – to network, gain peer support and hear from specialist speakers on the issues that affect them (such as leadership, governance, personal effectiveness, leading through change and managing the workforce). The forums are round table meetings with a limited number of places available, but these forums do not have regular memberships.

See also: The latest support programmes for SMEs http://wp.me/p3beJt-gB

John Whatmore, November, 2016

The latest twists in Accelerator programmes

Aside

Support for startups and scaleups: the latest new twists

Six developments all designed to enhance interactions among and between the entrepreneurs in Accelerator programmes, their mentor community, VCs and relevant corporates.

FinTech in London could hardly be more topical or more relevant; and Startupbootcamp is among the most experienced of support programmes. So what is new in their latest programme? (For a description of a recent programme, see http://wp.me/p3beJt-8W)

  • They have invited one startup to be a startup-in-residence – to add to and benefit from the experience of being in the Accelerator.
  • They are running three, yes three, mentor matching days in the first four weeks of the twelve week programme. This acknowledges that match-making is a chancy business, and that as a new business evolves its needs for help evolve too.
  • They are running a social meeting for their mentor community, where an inspiring entrepreneur will share his/her story, which will also provide an opportunity for mentors to share their own experience.
  • They are holding a meeting well into the programme at which heads of innovation in this case from major financial institutions will debate how they can best work with startups – an opportunity for those present to exchange experience.
  • And they are holding regular weekly ‘Coffee Houses’ – expert gatherings for mentors to meet informally with startups to discuss their challenges in the week to come, each one focused progressively on a topic of the moment.
  • Finally, some incubators arrange a session at which a number of VCs can listen to pitches from emerging businesses so that they might keep in touch with those that interest them.

Chance meetings are well-recognised as among the best sources of support, and time is so vital to every young business that anything that can increase the chances of a good chance is valuable.

See also ‘Design you own Accelerators’ http://wp.me/p3beJt-K.

John Whatmore, October 2016.

Helping young businesses to create partnerships

Aside

Helping young businesses to create partnerships

Finding a partner can provide a big step forward for a Scaleup, but in a disruptive world it is like looking you-know-not-where for you-know-not-what. Mediators are few and far between, but Nesta has shown a way forward; and Accenture has been a pioneer. Incubators and their ilk need a wide range of contacts on hand if they are to help with partnering.

For a young business with the potential for high growth, a ride on a partner can clearly generate a big step forward. A defining feature of SMEs is their lack of resources, says the recent Barclays ScaleUp Report: they need to leverage external resources, for example by alliances with established companies – which can:

  • help you develop your product
  • introduce you to markets
  • support you with funds and funding, and
  • enhance the value of your business.

Unilever’s European Open Innovation Manager’s search for new supply chains for example, starts with entrepreneurs and IP, for which he then looks for development grants, and partners – like Siemens, Akzo Nobel, Croda or Syngenta, who will adopt and use the new technology in order to deliver product to Unilever.

Nesta, some time ago in an open innovation pilot, acted as intermediary for P&G by eliciting and selecting relevant ideas and then providing a period of support and development with the help of a VC and enabling the best to be pitched to P&G, one of which looked like a winner – a process of building up communication channels and developing trust, now run regularly by its creaters ‘100% Open’.

Nesta’s recent ‘Scaling Together’ Report (March 2016) contains 37 ‘tips for corporates’ on how to develop relationships with such young businesses, but not a single one for the latter – on how to find and work with a corporate. Except perhaps the briefest of stories about the good luck Bill Clee of Asset Mapping had when his endless networking efforts eventually led to his being offered a place by Cisco in incubator IdeaLondon.

The current tide of disruption suggests that potential partners are increasingly likely to be found in surprising places; and, unsurprisingly, intermediaries have played a part in recent examples – such as:

*         Accenture’s Fintech Labs at Level39 (http://wp.me/p3beJt-3), where 8 to 10 young businesses are invited from all over the world to participate in an Accelerator development programme, sponsored by a dozen major banks, each of which provides a chaperone to introduce them to key individuals in their bank.

*         Accenture’s latest version of the Accelerator Lab, (millenial20-20.com) launched with a razzmattaz of a major conference on the future of retailing, complete with a store of the future, where some eight innovative businesses were selected for eight weeks together at The Trampery co-working space in Shoreditch; and the dozen major retailers (Argos, Sainsbury’s, Kingfisher, Specsavers, Dixons/Carphone – among others) were invited to presentations and discussions with them over the period of their residency.

For Accenture these were experiments in creating processes that would support major changes in sectors, whether disruptions or major challenges.

Often a mentor with wide experience and a big address book is a valuable mediator (one mentor was able to suggest ten possible customers for the technology of a business he was mentoring!)

These stories highlight the importance for incubators of having well oiled contacts with corporates that are on the look-out for entrepreneurs and IP, where partnerships might generate highly productive alliances for growth.

Dreamstake (http://wp.me/p3beJt-6H), online home to more than 15,000 young businesses of which 2,000 are technology based, now offers access to 50 VCs, 800 technology angel investors and to top influencers in the London technology scene as well as to successful founders in Silicon Valley – through its DreamLab Ventures initiative. But most incubators offer little more than office or desk space.

John Whatmore, October 2016

 

 

 

 

 

 

The latest support programmes for SMEs

Aside

Support programmes for young ventures in incubators

New support programmes for scaleups are of a design that could easily be replicated in incubators and their ilk, and could help generate big steps in growth.

Incubators have been essentially providers of low cost accommodation for small businesses, but they are coming under pressure to be more active in the support of their growth and development.

The concept of the Accelerator has illustrated what can be achieved by orchestrated forms of support – at least for startups. And the recent Barclays report has suggested that some of those approaches might also be usefully applied to Scaleups, with the aim of nurturing some great businesses of the future.

New programmes for Scaleups (such as the Judge Institute’s Growth Builder programme (http://wp.me/p3beJt-fn) and the RBS/UCL Business Growth programme (http://wp.me/p3beJt-dK) have taken the form of periodic meetings for CEOs, usually monthly meetings over twelve months, and consisting of mutual discussions of their problems and opportunities, and learnings about the latest developments in the most relevant topics, such as the latest uses of social media and the latest sources of finance. The Belgian Plato programme (http://wp.me/p3beJt-dH) (widely franchised in other countries) and the Vistage programme from the US (http://wp.me/p3beJt-cb) now popular in the UK – both for cohorts of senior executives, both use a very similar format.

What is common to these programmes is:

*         the exchanging of experience

*         their regular but occasional meetings

*         their intimacy and confidentiality

*         their ability to bring together individuals with common issues or experience.

And surprisingly, their addictiveness.

Their participants are usually carefully matched – for sector, technology, markets, size or maturity.

Young businesses with high growth potential will often be found in incubators, co-working spaces and innovation centres, where it would not be difficult to set in motion programmes of this kind, which could give a major boost to their participants.

John Whatmore, October, 2016