A note from Nick Sturge, the Director at Engine Shed: The Power of NED
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Scale-up Enabler, Briony Phillips, joined the Engine Shed team on a 1 year contract in June 2017 funded by Business West, Engine Shed, The University of Bristol and the West of England Local Enterprise Partnership (LEP). This group have a shared ambition – first, to identify scale-up businesses in the West of England region and to better understand their challenges and second, to design, facilitate and support initiatives that will make it easier for businesses to scale-up more effectively – in the long term.
Briony’s first priority was to create an overarching strategy for the year. This strategy has three pillars:
Once agreed, this strategy has provided a loose structure for Briony’s work over the last 8 months with initial work focused on getting to know the businesses and assets that exist in the region and plotting these on the now published Ecosystem Map. Over 300 products, services, organisations and programmes are captured and mapped according to the challenge that they respond to (according to those challenge themes identified by the ScaleUp Institute). The Scale-up Ecosystem Map was launched at the Scale-up Pow Wow, an event that brought together over 80 representatives from local businesses who are playing, or would like to play, a key role in the scale-up support ecosystem.
Whilst underpinned by this strategy, Briony’s work has also been organised by theme, focusing on those challenges that are raised by Scale-up Founders most regularly and with greatest emphasis. Briony’s approach has been to gather understanding of the challenge, to articulate that information publicly via blog posts and to bring the community together to discuss, learn, explore and launch potential solutions.
The three themes that are mentioned recurrently by scale-up founders are availability and affordability of office space, access to investment and leadership capacity. For the purpose of this update, Briony has taken each in turn:
The challenge: The challenge is multi-faceted. Whilst the lack of availability underpins the issue (largely due to permitted development laws leading to preferential conversion of grade B office space to student residential), for scale-ups there are added challenges around the expectations for covenants, the competition in the market, the high prices and the long, inflexible leases. (Read more in the full blog here)
Progress made: Briony blogged on this topic extensively both for Engine Shed and for TechSPARK. She also delivered a Scale-up Briefing entitled ‘Room for Growth’ (sponsored by Ashfords solicitors) which was attended by over 60 business founders and office space specialists. After this event, Business West has developed an open letter which has been signed by c. 20 founders (more to come) to highlight the depth of the problem.
Plans for the future: Briony plans to trial a training session to help scale-up founders better understand how best to go about securing office space. Briony is also supporting the distribution of the scale-up open letter from Business West. Briony is working with multi-occupancy space management companies to encourage them into the region and with key investors locally to explore how we can make ‘grow-on’ space available. Engine Shed also plans to launch a “Property Adviser in residence” service, alongside our “Investor-in-residence” service.
The challenge: The lack of active, visible investors (both angels and venture capitalists) in the region is a significant barrier which leads scale-up founders to spend an excessive amount of time travelling to London and overseas. Further, those angels and high net worth individuals in the region who are investing are limited by the lack of deal-flow information available to them. Finally, from an investors perspective, there is a lack of regional funds/microfunds to facilitate the flow of capital. From a scale-up founder’s perspective, the investment landscape is opaque and inactive, this group struggles to identify potential investors and often lacks tactical knowledge of how best to navigate the landscape.
Progress made: Briony organised a Scale-up Briefing focused on Raising £1M or more in January 2018. This event was attended by c. 70 founders and investment stakeholders and was run in partnership with TechSPARK and SETsquared. It was sponsored by London Stock Exchange and Alternative Business Funder. Briony has secured sponsors for a new Quarterly Investment Briefing which will launch in March 2018. This regular event and newsletter is intended to invigorate the investment ecosystem bringing investors together irrespective of their mode of investment, to share good practice, learn about new initiatives and consider opportunities for investment. Briony has built a partnership with UKBAA which saw the Bristol Angel Hub be the first to launch in the UK. This initiative intends to raise the profile, number and skills of the local angel investment community. Briony has identified nearly 100 finance related initiatives locally which are highlighted on the ecosystem map.
Plans for the future: Briony plans to write a blog to bring this challenge to life in Feb 2018. She is also working with Accelerated Digital Ventures and others to explore a possible local microfund and is working with the British Business Bank to contribute to their forthcoming regional Information Hub and regional investment activities. Briony has highlighted the need to expose deal-flow more effectively in the region by writing a short description of a ‘Deal Flow Analyst’ role which she hopes to find funding for. Briony is keen to encourage more Scale-ups to become B Corp businesses and is working on incentive schemes to support this in partnership with others.
The challenge: The leadership capacity challenge is three-fold in the West of England. First, we see leaders of fast-growth businesses grappling with their own leadership development and lacking close peer to peer networks. Second, we see them experiencing challenges in recruiting and working with suitable NEDs, advisory and governing boards. And finally, scale-up founders encounter challenges in recruiting their key senior hires into the business.
Progress made: Briony hosted a roundtable with Thangham Debbonaire MP and 8 low-carbon businesses. This provided a proof point for the value of bringing these communities together and was a purposeful discussion which she hopes to repeat before the end of her contract. Briony hosted a ‘Workunch’ (workshop and lunch) for a small group to explore and capture the NED/Advisory board challenge, this is yet to be published and produced a number of suggested solutions which Briony has shared with relevant stakeholders. For example, a number of attendees have suggested that a log of potential mentors would be valuable to businesses. Briony’s work has precipitated the development of two entrepreneur-led scale-up leadership projects. She also champions a number of local private and public sector initiatives designed to support leaders (including Executive Foundation, Inspire Elite and Scale-up coaching grants).
Plans for the future: Briony has planned a Scale-up Briefing on March 7th which will centre on a presentation from Uday Phadke, author, Entrepreneur in Residence and Scale-up CEO. This event will also see the advertisement of various new and existing leadership support initiatives. Briony hopes to build on the Scale-up Pow Wow to work with local stakeholders to deliver a ‘Scale-up Great Britain conference’ in Q3 or Q4 2018 inspired by her attendance at the London event in 2017.
Briony has also worked towards wider ecosystem development. She has championed the applied, practical theory and support provided by Endeavor Insight and Dan Isenberg’s Babson Entrepreneurship Ecosystem Project with others leading change in the ecosystem and works to convene all relevant stakeholders around a single mission – to make the West of England not only the best place to start a business, but also to scale one. Briony spends c. 1 day every 2 months working in London alongside the Scale-up Institute. This growing relationship saw Engine Shed mentioned 40+ times in the latest Scale-up Institute report and has seen Nick and Briony included in a number of initiatives such as Nick’s role on the Advisory Board for the InnovateUK Scale-up Programme Pilot. Briony hopes that her work on the ecosystem map will provide a framework for others across the country and looks forward to many more collaborations.
Measuring Success – eight months in
At the start of her contract, Briony explored possible metrics for success. However, with an emergent strategy and a commitment to respond to the needs and interests of scale-up founders and ecosystem leaders, it was agreed that metrics weren’t a priority. Further, the Steering Committee recognised the power of Engine Shed’s commitment to ‘engineered serendipity’ and to nudging, cajoling and encouraging actions in others rather than mandating them. The following figures and testimonials give some insight into the breadth and depth of work undertaken so far:
And from a less numerical perspective, Briony has collected a few lovely testimonials from friends across the region:
“Lifestyle, sole traders, family businesses, partnerships, SMEs, corporates, start-ups; Business West’s 21,000 members encompass a variety of business purposes and types all contributing to Bristol’s economy. However, we applaud The Scale-up Institute’s fascination with businesses that provide the fizz in our city and Business West is delighted to join the Institute and Engine Shed in spawning and nourishing these catalysts of growth”
Phil Smith, Managing Director, Business West
“At the West of England Combined Authority, we have a commitment to nurture and support business to aid regional economic growth. We want small businesses to gain confidence and grow their ambitions and operations. Local on the ground support is an important tool to help them access support while bringing them together to share experience, learning and understanding.”
Mayor of the West of England Tim Bowles
“In the West of England the impacts of the technologies developed here are having transformative impacts across multiple industries. The scale up opportunities from our tech cluster are, as a result vast which puts pressure on the economy to cope. The work of the West of England’s Scale-up Enabler is critical to ensuring we can meet the demand generated.”
Matt Cross, Head of Inward Investment, Invest Bristol and Bath
“The Scale-Up Enabler is the missing piece of the South West Scale-Up puzzle. Briony has mapped complex webs of initiatives to champion scale-up businesses and drive region-wide action on projects for financial investment, infrastructure and leadership. The growth and success of our scale-up community aligns with Burges Salmon’s investment in the region in what we hope is a virtuous cycle.”
Adrian Sheddon, Head of Fintech, Burges Salmon LLP
“The University of Bristol is pleased to co-fund the Scale-up Enabler for West of England. Engine Shed scale-up activity is already driving greater collaboration and action in the region which will continue to make the city and its business community one of the most innovative and exciting places to work, study and live in Europe.”
Professor Nishan Canagarajah, Pro Vice-Chancellor (Research and Enterprise) University of Bristol
“As manager of a new science and tech innovation space, the monthly Bristol & Bath Networks group initiated by Engine Shed helps me connect effectively with key players locally and provide a great platform for sharing news and views. Of all the regional innovation ecosystems I have participated in across the UK, this has the most collaborative culture; it’s very special.”
Elaine McKechnie, Centre Director, Future Space, UWE