What support do tech entrepreneurs need to successfully turn innovative tech ideas into reality?
With nine out of 10 startups failing to make it to three years in business, the question has never been more pertinent.
The startup ecosystem comprises incubators, accelerators, innovation labs and projects specialising in different areas of technology – a confusing landscape to navigate.
At the earliest stages, incubators – often tied to universities – are a good port of call. These often develop technology-led ideas arising from undergraduate and postgraduate studies, or host R&D projects being tested by existing businesses as part of Knowledge Transfer Partnerships, and is where the foundations of new tech businesses can be firmly put in place.
Accelerators, government-led catapults and scaleup support programmes are all designed to help businesses through the next stage of scaling, going to market and preparing for investment. The approach, type and level of support varies from programme to programme; from resources and lab space, to business mentoring, industry-specific skills development, access to technology test beds, development partners and simply being part of a wider network of entrepreneurs, sector specialists, customer and investor networks.
Time and cash are often the headline features but, if we’re to avoid a scenario where businesses are effectively conditioned to ‘programme hop’ to secure their next round of funding, how can we reshape the landscape to provide the support they need while enabling them to become financially independent?
The key lies in placing commerciality at the core of the business startup ecosystem.
Almost every tech development has myriad potential applications but this means it can be all too easy for founders to get lost in the tech itself, worry about the needs of the end user too late, or be pulled in too many different potential directions to maintain focus.
Ensuring there is a real world need for their product – right from minimal viable product or concept stage – is crucial for securing customers and investment. Keeping sight not only of who the end customers are, but also what their needs are and which of those potential customers may be best placed to take advantage of the technology informs the route to market, which in turn helps to develop the business plan and secure initial contracts, use cases and investment.
So, what can we do to help increase the number of early-stage tech businesses that make it to three years and beyond?
Geography has a key part to play, with real potential for complementary programmes to work more collaboratively to attract and support businesses at various stages of their development. This has the added benefit of providing a clear focus and building on existing skills and knowledge-bases in a region to speed up the development and adoption of new technologies.
By playing to the existing strengths of a local population – be that in manufacturing or security expertise, for example – tech innovators can identify real world challenges and opportunities more quickly than would be the case when working in isolation. More exposure to different requirements in turn drives the creation of more-effective solutions, all while building a critical mass of demand that allows exciting concepts to move more quickly off the screen and into reality.
We also need to look closely at vested interests in the sector. Are advisors truly taking an independent view and offering sage advice or are they sometimes too focussed on achieving their own KPIs to be really objective? And while it’s only natural that organisations will steer business towards programmes that help them maintain or grow market share, sometimes a competitor programme may be more suitable for a particular business. Building better links between individual programmes means this sector can create individualised pathways for businesses to ensure they receive the support they, not the wider programme, needs.
As part of this approach, it’s important that accelerators, catapults and other support programmes adopt some of these changes themselves, offering cohorts a mixture of hands-on knowledge and expertise but proactively collaborating with industry partners where they can offer ready-made runways.
Finally, the whole ecosystem needs the support of existing, established businesses to thrive. Proactively engaging with tech entrepreneurs is a great way to get R&D projects off the ground, develop market share and even steal a march on competitors. Getting it right is a win win for all concerned. We just need to join the dots and not shy away from greater collaboration to make it happen.
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