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“Gamblers take risks, entrepreneurs manage risks”

For me, this was one of the stand-out quotes from the morning session of Accelerate 2013, the festival for Britain’s high-potential, fast-growth businesses held in Liverpool last week, writes Howard Robinson, head of communications at Ingenious Britain.

The comment, which was made by the urbane and eloquent Dr Shai Vyakarnam from the University of Cambridge Judge Business School’s Centre for Entrepreneurial Learning (CfEL), revealed in one sentence one of the key factors, in my view (not the only one, obviously) between the chances of small business success and the potential for small business failure.

Let’s address the issue of risk up front to begin with. When I was growing up, the business landscape of Britain was founded on largely high levels of employment; people tended to remain in one job for a number of years and, in some cases, for their entire careers. Job security was comparatively high and, provided they had made the right choices, people felt assured of a continually rising income stream. The notion of starting your own business was, for many, reserved for those with nothing else to do, with money to burn or for those who were prepared to gamble hard in return for the potential high rewards of delivering a successful enterprise.

It’s not like that today and, in truth, hasn’t been for years. Schools and colleges have begun to teach entrepreneurialism as a discipline in its own right as society finally sees the benefit of embracing a small business and start-up culture. In late 2012, the Global Entrepreneurship Monitor (UK) report highlighted that for the first time since recording began in 1999, over 20% of the working age population in the UK either expected to start a business in the next three years, were actively trying to start a business, or were running their own business. Importantly, this rise in start-up activity is not just driven by necessity: while there were twice as many necessity-based entrepreneurs trying to start new businesses in 2011 as in 2010, the number of people trying to start new ventures because they spotted a business opportunity also rose significantly.

A responsible, mature start-up culture, though, as Dr Vyakarnam mentioned requires a managed approach to risk. In this sense, it echoes two other key messages that came through in Liverpool: the importance of keeping cash in your business for fluidity and the importance of selling your products and services to customers as a way of keeping your business as independent as possible of debt to financial institutions. If you can manage those three, then success is a real possibility and risk is well and truly managed.

The other prevailing feeling from Accelerate, aside from the real breadth of small businesses in the UK, is not only how much they can learn from each other but the extent to which they are prepared to share with each other. A collaborative approach to learning, best practice exchange and information – which has always been the hallmark of Ingenious Britain – will produce a small business sector even more vibrant and resilient than the one we have now. And that’s important for our economy as much as it is for our small business owners.

Article taken from Ingenious Britain.

This was posted in Bdaily's Members' News section by Ingenious Britain .