Supporting the Next Generation of Female Founders

New research released by LifeSkills created with Barclays has revealed that over half of aspiring female entrepreneurs in the UK say that the COVID-19 pandemic has made them want to start their own business (51 per cent). In this Female Founders Forum blog, we cover Barclays’ Investing in Women Code commitments, the first of which is aimed at supporting the next generation of female entrepreneurs. We also share highlights from our FFF members and provide updated guidance on the government’s COVID-19 support schemes. 

Female Founder Highlights

Streetbees, founded by our Member Tugce Bulut has released its latest whitepaper, providing a deep dive into the impact of the COVID-19 pandemic on the quick-service restaurant industry. Read the special report here.

Government Support

Kickstart Scheme
The government has introduced a new Kickstart Scheme to create hundreds of high-quality 6 month work placements aimed at 16 to 24 year olds who are on Universal Credit and are deemed to be at risk of long term unemployment.

It is a very generous scheme which will: pay 25 hours of young people’s wages at National Minimum Wage; cover Employer’s National Insurance and pension contributions for 6 months and; provide £1,500 to employers for costs and training.

However, as TEN mentioned in their Newsletter last week, it’s being targeted at large businesses. You need to sign up to the scheme in batches of 30 – ie. take on 30 work placements. This might make sense for the ease of government administration, but given that it’s new, young businesses that create most new jobs, it looks like the Government may be missing an opportunity. 

There is a way around it, however by joining a group of other employers, nominating a representative for the group to submit the application, or registering your interest with existing representatives, such as local authorities, chambers of commerce or trade bodies.

If you're an employer who is looking to create a job placement, you can check here if you are eligible to apply for funding under the Kickstart Scheme.

Updated Guidance: Job Retention Scheme 
The government has published updated guidance to reflect changes to the Job Retention Scheme:

• From 1 September the government will pay 70% and employers will pay 10% of employees’ wages for the time they are being furloughed. Employers will also continue to pay their National Insurance and pension contributions.

• From 1 October the government will pay 60% and employers will pay 20% of employees’ wages for the time they are being furloughed. Employers will also continue to pay their National Insurance and pension contributions.

• You will continue to pay employees wages at the contracted rate for the hours they work for you.

The scheme ends on 31 October 2020. Find out more here. 

Barclays Support and Opportunities

Female Founders Forum 2020 Digital Events
We had an excellent session last week on Access to Finance where Juliet Rogan, Head of Barclays’ High Growth & Entrepreneurs (HG&E) team was joined by expert speakers, Alexandra Daly, founder of AA Advisors, Julia Elliott Brown, founder of Enter the Arena and Baroness Kramer. 
 
In our next session on Thursday 8 October 2020 from 10am - 11:30am, we will be discussing Attracting & Retaining Talent. You can sign up for the event here.
 
As we mentioned in the last blog, we will be running a series of events over the coming months:
 

• Building Personal & Operational Business Resilience webinar - 10am - 11:30am, Thursday 5 November 2020 - sign up here

• Cementing Your Story webinar - 10am - 11:30am, Tuesday 4 December 2020 - sign up here

 
In each webinar, we will be joined by an eminent high growth Female Founders Forum member, an expert speaker and hear insights from Juliet Rogan, Head of Barclays HG&E team. 

If you are interested in attending a specific webinar, please contact jess@tenentrepreneurs.org and we will add you to the invitation list.

Launch of Barclays’ first ‘Investing in Women Code’ commitment 
Barclays is taking action to close the entrepreneurship gender gap, through a series of measures designed to boost the resources and financial support available to female founders. The first in a series of three-year commitments, launched last week, will see the next generation of female founders supported through the bank’s LifeSkills programme, helping them turn their plans into action.  Hannah Bernard, Head of Barclays Business Banking, explains how the bank is backing women in business. You can read more about the launch of this first commitment here.

Eagle Labs Virtual Events
Barclays’ programme of virtual events covers a range of topics from cashflow management to building resilience to help entrepreneurs and start-ups navigate these uncertain times. Forthcoming events include a session on thinking differently about social media marketing and an event to demystify AI, machine learning, and machine intelligence. All events are free to attend and open to anyone. For more information visit the Eagle Lab event page.

Barclays Coronavirus Support Hub
The Barclays COVID-19 Support Hub provides the latest information, tools, and guidance to support businesses throughout the COVID-19 pandemic. This hub includes information about Barclays’ products, webinars, Facebook Live events, and more information on how to access government schemes. You can also download Barclays’ coronavirus checklist to support your business resilience planning throughout this period. There is also an updated FAQ section on this hub.

We want to inspire female entrepreneurs across the UK. Do you know any inspiring female entrepreneurs? If so, please connect them directly to me at jess@tenentrepeneurs.org.

Educating Future Founders

Yesterday we launched a new report: Educating Future Founders. With support from ABE, the not-for-profit skills development specialist and awarding organisation, we review the evidence for early interventions in entrepreneurship education. It makes the case for teaching children as young as eleven the basics of running a business. For a neat overview, read Sam Dumitriu’s article for CapX.

It’s choc-a-bloc with inspiring examples of organisations supporting young entrepreneurs across the world, such as Teach a Man to Fish’s School Enterprise Challenge, Prince’s Trust International’s Enterprise Challenge, ABE’s KidsMBA, and VIVITA.

And It’s packed with evidence as to why many of these interventions are valuable. For example, an analysis of Junior Achievement’s Company Programme, the most widely taught entrepreneurship programme in the world, followed 9,731 Swedish participants over sixteen years. As well as finding that participants were more likely to start a business, participants earned on average 10.2% more from entrepreneurship more than a decade after compared to entrepreneurs who did not participate. 

While the evidence is significant, there is another benefit that’s laced throughout the report, and one that I think is often underplayed as it can’t be easily measured. Starting (or pretending to start) a business when you’re a child is a lot of fun. 

School can be boring (and for those that struggle humiliating). There is perhaps an inevitability that at least some aspects of schooling will be tedious, but the injection of entrepreneurship into the day, or after school, is clearly a welcome break from the daily grind. I think we should want our children to be happy as an end in itself, but I also suspect this is why some of the interventions seem have such a high impact and seem to still have a positive influence years later.

This is our third report on education. The others being Future Founders, which we undertook with Octopus and my report for the APPG for Entrepreneurship on enterprise education at universities. It won't be our last.

Smart cookies 
Building on last year’s Smart Data Review, the government has set out its Next Steps for Smart Data. For the uninitiated, Smart Data is the sharing of data with authorised third-party providers, which helps support innovative new services.

Open Banking, for example, has over a million individual and SME users, and over 250 authorised third parties and account providers. The likes of Moneybox and Xero prove that great entrepreneurial business can be built on the back of Smart Data, but as the consultation found there isn’t a sector that couldn’t benefit from it, with education, retail, transport, and health featuring prominently. 

In education, new businesses could be created with access to willing individuals’ education records and proof of attainments. In transport, linking trains, airlines, and vehicle data could enable apps that automatically claim for redress following delays, or enable consumers to track their carbon footprint.

We’re often told that data is the new oil. It’s always struck me as a trite analogy. However, perhaps it makes sense in describing how, with support from government and innovative entrepreneurs, data can lubricate processes, making our lives that little bit easier.

Natasha Lomas has an extensive writeup at TechCrunch on the announcement and next steps.

London calling
Our friends from the Start-ups in London Libraries project of the British Library are looking for an expert volunteer to lead a free training webinar session to a group of business advisers based across their ten London Borough Libraries. (Last time they needed help like this, I asked in this newsletter and they got some great volunteers.)

These boroughs tend to be representative of communities often disadvantaged and under-represented in entrepreneurship and their client base are pre-start-ups and start-ups that have been running for less than a year. They are looking for advice on product pricing (ie. what entrepreneurs need to think about when pricing their product) and product creation and manufacturing (ie. what to look for in terms of safety, manufacturing abroad and how to do it). 

It would be for 3 hours on either 2nd October or 6th November and will be delivered by Zoom. Drop Marette an email if you’re able to help.

Teach Children Entrepreneurship

Today, we release a new report sponsored by ABE which advocates teaching children as young as 11 the basics of running a business.

• There is an untapped opportunity to promote economic growth and reduce unemployment by expanding access to entrepreneurship education to secondary school students.

• Across the world, a third of young people aged 18-24 intend to start a business in the next three years. But many don’t follow through due to a fear of failure and a lack of knowledge.

• Employers increasingly see skills developed in entrepreneurship programmes such as creativity and innovation, self-reliance, collaboration and problem solving as key to the success of young people in the workforce.

• Entrepreneurship education programmes aimed at secondary school students have been shown to reduce the risk that a young person will become unemployed later in life.

• Since the start of the 21st century, the proportion of young people who work for themselves has doubled. Skills such as financial literacy, business awareness, and an entrepreneurial mindset will be vital for adapting to the modern world of work.

• Entrepreneurship has traditionally been taught at universities, but there is strong evidence that earlier interventions can develop traits that are key to entrepreneurial success, such as creativity, persistence, and communication.

• There is evidence that participation in entrepreneurship education programmes can lead to long-run entrepreneurial success. An analysis of Junior Achievement’s Company Programme, the most widely taught entrepreneurship programme in the world, which followed 9,731 Swedish participants over sixteen years found that participants were more likely to start a business. Participants earned on average 10.2% more from entrepreneurship more than a decade after compared to entrepreneurs who did not participate.

Is the education system equipping young people with the skills to succeed in a fast-changing labour market? A new report from The Entrepreneurs Network argues that as children return to schools after lockdown, students as young as eleven should have the opportunity to learn about entrepreneurship in order to develop the skills and mindset necessary to prosper in the modern economy. 

Recent research from MIT and the London School of Economics finds that exposure to innovation and entrepreneurship at an early age can have lasting impacts. However, half of young people in the UK (aged 14-25) do not know a family member or friend who is a business owner and the majority cannot name an entrepreneur who inspires them. Evidence from programmes in Australia, Denmark, and the Netherland finds that short, low-cost entrepreneurship education programmes targeted at students as young as eleven can raise awareness of entrepreneurship as a career and develop entrepreneurial attitudes.

Entrepreneurship education can complement traditional subjects such as Maths and English. High school students who took part in NFTE, a US entrepreneurship programme, doubled their interest in applying to university. While a Danish programme that focused on developing entrepreneurial traits made students more likely to report that they ‘enjoy being in school’ and are less likely to say ‘I get bored a lot in school’.

Many of the skills students learn when they receive entrepreneurship education are applicable beyond starting and growing a business. For example, the ability to stick at problems and proactively find creative solutions while working with others is desirable in any workplace. Longitudinal studies which track students over decades find that students who have participated in the Company Programme, the world’s largest entrepreneurship education programme, were more likely to be in leadership positions at work and less likely to be unemployed than otherwise similar students.

Teaching young people the basics of starting and running businesses will not only lead to more businesses starting up, but also will raise the overall quality of businesses. One large study found entrepreneurs who had taken part in entrepreneurship education programmes when they were young earned on average 10.2% more from entrepreneurship 11 to 12 years after graduation compared to entrepreneurs who had not taken part. 

Recommendations

Despite the strong case for teaching young people entrepreneurship, many young people across the world lack access to entrepreneurship education programmes in secondary school. To rectify this, Educating Future Founders makes three key policy recommendations.

• To identify best practices in entrepreneurship education, governments should improve data collection and fund Randomised Controlled Trials (RCTs).

• Once best practices in entrepreneurship education are identified, the Commonwealth Secretariat should promote them through the Education Hub, support members to develop new curriculums, and work with organisations such as the Global Entrepreneurship Monitor to create a Best Practice Index.

• To drive positive change, national leaders should assign clear responsibility within education and business departments for promoting entrepreneurship education at secondary level.

Rob May, Chief Executive of ABE Global, says:

“There must be a sense of urgency if we are to equip young people to thrive in the post-pandemic modern economy. If there was ever a moment to inspire a younger generation of entrepreneurs, it is today.

This research takes a vast perspective by examining the case for school-age entrepreneurship education across multiple countries and cultures. They offer policymakers and educators vital context for rethinking curriculum planning.”

Sam Dumitriu, Research Director at The Entrepreneurs Network and author of Educating Future Founders, says:“Through entrepreneurship education, we can teach young people the skills to adapt as the world undergoes rapid economic change. But many young people lack the opportunity to learn about how to start and run a business. By expanding access to entrepreneurship education, we will not only bring through the next generation of founders and job creators, but also teach young people the mindset and skills they need to thrive in the modern economy.”

The Rt Hon Baroness D'Souza, scientist and former Lord Speaker, says:

“This timely report addresses how we equip our children for the 21st century digital world. Many of the jobs that our children will have in 20 years have not yet been invented, but we continue with the old models of education and exams designed for another century.It is tempting to sink back into older and well-tried approaches to education and to development – but the opportunity to use the pandemic as a jumping off point for new and radical thinking and, most importantly, funding is here. I congratulate ABE Global and The Entrepreneurs Network on what should become a milestone report.”

You can read the report here.

Identity Politics

Over the years, I’ve become a convert to the idea that the UK government should build the infrastructure to ensure that each person has a digital identity when interacting with the state. As such, I’m cautiously optimistic at this week's news that the government “plans to enable the use of digital identity across the UK”.

I write 'convert' because when Tony Blair’s government tried to introduce ID cards between 2004 and 2010 I was hugely sceptical for reasons of civil liberties. At the time, the policy was principally framed as a fight against terrorism, asylum seekers and benefit fraud, with a National Identity Register holding everyone’s biometric data, including fingerprints, digitised facial scan, and iris scans. In 2005, the London School of Economics produced an expert, highly critical report, The Identity Project, which showed why the government was on the wrong track.

The Identity Project recommended another way. One that wasn’t centralised, and as a result more secure, with data controlled by the user. This federated approach was mainstream thinking prior to the ID cards debacle, and can be seen in developments like Government Gateway, the tScheme for accrediting third parties, and the launch of GOV.UK Verify, which allows you to access government services like filing your tax or checking the information on your driving licence. Jerry Fishenden has written a history of federated identity in the UK for access to online public services since the 1990s, for anyone that wants to get into the nitty gritty of the issue.

Since my conversion, my eulogising has mostly centred around the case of Estonia, which has a very highly developed system of e-government. I wrote back in January on why this self-styled ‘digital state’ shows the way for Whitehall reform and more recently for Forbes on why it has been able to respond better to Coronavirus than many other countries.

But what’s all this got to do with entrepreneurs? In essence, it will save an immense amount of time on bureaucracy. It’s estimated that X-Road – the backbone of Estonia’s digital society – saves around 12 million hours every year. Its once-only principle is a neat way to ensure government departments fall in line, as citizens, institutions, and companies only have to provide information to the authorities and administrations once.

McKinsey estimates that we could add 3 per cent to UK GDP by 2030 if we get the digital reforms right. I'm all for making every man, woman and child richer (on average), but just imagine the satisfaction of being able to tell the government that you don't need to fill in that form because you've already given them that information. In fact, you've given them the same information hundreds times, year after year. That will be priceless.

The value of a digital identity has become particularly acute in the pandemic. As reported in The Times: “Emergency measures in response to coronavirus, such as the self-employment income support scheme, exposed difficulties in identifying people. When the pandemic started the government’s databases had no information on nearly half of the 2.6 million self-employed people who claimed support.” Times subscribers should also read James Hurley on how the virus has left millions of Britons unable to access emergency support. A lot of entrepreneurs haven't been supported through the crisis due to a systemic failure of data, perhaps most notably company directors who paid themselves in dividends.

Despite near-universal misreporting, this isn’t a return to the ID Card and a nationalised database. On this at least, the Prime Minister, who claimed back in 2004 that he would “masticate the [ID] card to the point of illegibility” can’t be fairly accused of hypocrisy. We have been moving, albeit slowly, in this direction for decades. It’s now time to move up a gear.

Non-starter
On Wednesday, the UK Government released details of the Kickstart Scheme, which incentivises businesses to create 6-month work placements for 16-24 year olds in new roles.

It’s very generous. The scheme will: pay 25 hours of young people's wages at National Minimum Wage; cover Employers’ National Insurance and pension contributions for six months; and provide £1,500 to employers for costs and training.

However, it’s being targeted at large businesses, as you need to sign up to the scheme in batches of 30 – ie. take on 30 work placements. This might make sense for the ease of government administration, but given that it’s new, young businesses that create most new jobs, it looks like the Government is missing a trick.

Hopefully they will take heed of the criticism and open it up to smaller companies, but even if they don’t, there is a way round it. You can join a group of other employers, nominating a representative for the group to submit the application, or register your interest with existing representatives, such as local authorities, chambers of commerce or trade bodies.

For example, our friends at Coadec are looking to bring together entrepreneurs who might want to use the scheme, in order to apply together. They will sort the admin and help with the paperwork. Drop Dom Hallas an email to register your interest.

Procure meant be
The Crown Commercial Services is the biggest public procurement organisation in the UK. It helps thousands of public and third sector buyers in the UK with billions of pounds of spending each year, and is supporting the government objective to have a 33% spend of the UK Government supply chain contracted with SMEs by 2022. 

It is introducing a number of new processes with the aim of making the bidding process easier, quicker and less burdensome. To help them know what can be improved, they have asked us to share this survey with you. It takes around 30 minutes to fill in.

Sign up to our Newsletter here.

Building Back Better

The Women’s Enterprise Policy Group (WEPG) has made fresh calls for more gender-responsive policy to address gaps identified in COVID-19 enterprise support schemes. In this blog, we cover the new report, insights from our inspiring Members, and updated guidance on the government’s support schemes. 

Female Founder Highlights

Here is a quick wrap up of this week’s news highlights, featuring some of our inspiring Members:

• A new report from the Women’s Enterprise Policy Group (WEPG) has warned of a “catastrophic economic impact” if government policy fails to support women’s enterprise. The group is urging the Chancellor to bring them to the policy table to help shape policy that ‘Builds Back Better’ for women entrepreneurs, for the economy, and for society. Roseann Kelly MBE, CEO of Women in Business NI said the study outlines how current policies have failed to reflect the extra challenges female entrepreneurs face from childcare, gender bias to access finance. Read the full article here.

• TechRound interviewed our Member, Tugce Bulut about the challenges she has faced as she grows Streetbees and her thoughts on being a Female Founder in 2020. “There is no such thing as ‘female’ or ’male’ entrepreneur, you are simply an entrepreneur but the reality is that there’s still a distinct lack of diversity among c-level positions in business, particularly tech.” You can read the full article here.

• BBC covered its most memorable interviews over the years for its CEO Secrets series, including their interview with Female Founders Forum Member and Mumsnet founder Justine Roberts where she revealed crushing feedback from early potential investors who told her “she didn’t look the part.” Read more stories about finding resilience here.

• Harriett Baldwin, MP for West Worcestershire and our Member has urged people to treat themselves to a meal out in support of the ‘Eat Out to Help Out’ campaign for the hospitality industry. Harriett said, “hospitality is one of the industries that will need extra support as we try to protect as many jobs as possible.” Read the full article here.

Government Support

Grants for businesses completing customs declarations
Businesses can apply for 3 grants to help their business complete customs declarations. They can apply for funding for:

• Training that helps a business to complete customs declarations and processes;

• Hiring new staff to help their business complete customs declarations; and

• IT improvements to help their business complete customs declarations more efficiently.

You can find out more information about the scheme, eligibility criteria, and how to apply here.

Coronavirus Job Retention Scheme and overtime work
The government has published updated guidance on calculating how much employees can claim under the Coronavirus Job Retention Scheme for fixed employees who have worked enough overtime (in the tax year 2019 to 2020) to have a significant impact on the amount they need to claim.

Barclays Support and Opportunities

Female Founders Forum 2020 Digital Events
We are pleased to announce that Alexandra Daly, founder of AA Advisors and Julia Elliott Brown, founder of Enter The Arena will be joining our first webinar on Access to Finance on Thursday, 3 September 2020 from 10 am - 11:30 am. You can sign up for the event here.
 
As we mentioned in last week’s Newsletter, we will be running additional webinars in this series over the coming months, including:

• Attracting & Retaining Talent webinar: 10 am - 11:30 am, Thursday 8 October 2020

• Building Personal & Operational Business Resilience webinar: 10 am - 11:30 am, Thursday 5 November 2020

• Cementing Your Story webinar: 10 am - 11:30 am, Tuesday 4 December 2020

In each webinar, we will be joined by two eminent high growth Female Founders Forum members, an expert speaker, and hear insights from Juliet Rogan, head of Barclays High Growth & Entrepreneurs team. 
 
If you are interested in attending a specific webinar, please contact jess@tenentrepreneurs.org and we will add you to the invitation list.

Barclays Boosting Female Entrepreneurship Facebook Live event
Join Hannah Bernard, Head of Business Banking as she announces Barclays’ commitments to support female entrepreneurs through COVID-19 and beyond. Hannah will be joined by a panel of experts, including Barclays' long-standing LifeSkills ambassador Baroness Karren Brady CBE, as they offer their top business tips, discuss their own experiences and highlight why it’s so important to develop the next generation of female entrepreneurs whilst supporting the founders of today. Tune in on Wednesday 26 August, 10:00 – 11:00 to our Facebook Live to hear more.  

Eagle Labs Virtual Events
Barclays’ programme of virtual events covers a range of topics from cashflow management to building resilience to help entrepreneurs and start-ups navigate these uncertain times. Forthcoming events include a session on thinking differently about social media marketing and an event to demystify AI, machine learning, and machine intelligence. All events are free to attend and open to anyone. For more information visit the Eagle Lab event page.

Barclays Coronavirus Support Hub
The Barclays COVID-19 Support Hub provides the latest information, tools, and guidance to support businesses throughout the COVID-19 pandemic. This hub includes information about Barclays’ products, webinars, Facebook Live events, and more information on how to access government schemes. You can also download Barclays’ coronavirus checklist to support your business resilience planning throughout this period. There is also an updated FAQ section on this hub.

We want to inspire female entrepreneurs across the UK. Do you know any inspiring female entrepreneurs?

If so, please connect them directly to me at jess@tenentrepeneurs.org.

We will be sending through our Newsletter every two weeks. If you share content with the hashtag #femalefoundersforum, we will retweet you or repost it.

On the Level

Getting exam results is stressful enough – knowing that you’ve got the wrong ones must be devastating.

Working out A-Level results was always going to be a challenge but some of today's results are nonsensical. For example, one in thirty people taking Maths and Further Maths got a grade B in the former and a grade A in the latter. This is absurd, and something that was extremely unlikely in previous years. 

Thanh Duong, for example, got an A in Maths and A* in Further Maths, and as a result will miss out on his place at Cambridge University. Ironically, Thanh’s father had pre-warned of today’s failure following an analysis of Ofqual’s published data, calculating that 39% of grades between A* and D would be lower than the teacher assessments.

To rub salt in wounds, there appears to be a bias in favour of the children of the wealthy, with the year-on-year rise in proportion of students achieving A or A* grades much higher at independent schools than state comprehensives.

While the awarding bodies have provided schools with standardisation reports, in order for schools to do detailed checking they would need to be given the measures of prior attainment used and how they have been banded in each subject, both for 2020 pupils and for historic pupils, explains Dave Thomson, chief statistician at FFT.

Many, including David Davis MP, are calling upon universities to be more flexible and offer places based on mock results and predicted grades. And even before today’s confirmation of the failings, the Royal Statistical Society called for the UK Statistics Authority to launch an urgent review into Ofqual and the Scottish Qualifications Authority over the algorithms used to predict students’ exam results.

Exam results aren’t everything, but a lot of young people are inspired to become entrepreneurs at university. Our Future Founders report we undertook in partnership Octopus found that young people are more likely to consider starting or have started a company if they are attending (65%) or have graduated from university (63%) compared to 18-25 year olds who haven’t attended university (53%).

(A note of caution though, we shouldn’t use this failing to bash the use of all algorithms. After all, there is evidence that fintech algorithms discriminate 40% less than face-to-face lenders. And for further reading on this, check out Sam Dumitriu’s article from last year, Chris Stucchio and Lisa Mahapatra's thoughtful piece on the way data scientists think about bias as distinct from journalists, and this great debate on algorithmic bias.)

Every Cloud 
Our good friends at Coadec are cooking up proposals for the Government to encourage small businesses to buy productivity-boosting digital services and technologies by providing them with financial incentives and reliefs on their purchases. But they need your help, and have a few questions for B2B tech startups which will help them make the case to the Government. It will take less than a minute to complete (honestly!).

Just last month we produced a report with Xero on this issue. Upgrade argued that if the UK’s 1.1m micro businesses doubled their uptake of key digital technologies, it would lead a £4,050 average productivity boost for the 4.09m workers employed by micro businesses, restoring four-fifths of lost productivity growth since the financial crisis, and enabling businesses to bounce back faster post-lockdown.

Ask the Experts
Getting good advice is critical to any business. Over the years we’ve had lots of entrepreneurs approach us with questions about their business, and while we know a thing or two about policy, we aren’t really best placed to advise on business matters.

Up until now we’ve always connected entrepreneurs in our network to people in an ad hoc way, but this isn’t very efficient. As such, we’ve created an Ask the Experts page on our website so entrepreneurs can quickly find people and organisations that we think it’s worth chatting to about various areas of your business.

Our first recommendations are Kingsley Napley for immigration advice and Form Ventures for regulatory matters. We’ve worked with Kingsley Napley for a number of years on roundtables and so far the feedback from entrepreneurs in our network who’ve followed up with them has always been positive. Leo Ringer of Form Ventures is one of our Research Advisers and is an expert on the regulation of high-potential / high-growth firms that are operating in markets where public policy is a major source of risk and opportunity.

Our experts will answer relevant queries and also support entrepreneurs by contributing to our essential Policy Updates. We’ll add more experts in the coming weeks in other policy areas, including taxation, finance and employment. If you’re an expert who wants to support the network, drop me an email to find out more about how you can help.

Sign up to the Friday Newsletter here.

Building Hopes

Whenever I’m asked which policy changes would best support entrepreneurship in the UK, planning liberalisation always features near the top (often to the surprise of the person asking the question). Up until last week, it’s an area where meaningful reform looked unlikely, but Housing Minister Robert Jenrick’s Planning for the Future White Paper offers reasons to be hopeful. It would involve councils being set higher requirements for new housing, especially in and around cities, while ensuring that new buildings are more beautiful.

The first person I turn to when trying to understand planning reform is John Myers (aka London YIMBY, which is a campaign group that aims to end the housing crisis). Planning is a policy area that attracts some wacky views (just take a look at nine that Sam Bowman skewers), and for my money Myers is the most knowledgeable and intelligible thinker on this policy area. While he is unashamedly pro-building, he is an honest broker of ideas. Myers describes Jenrick’s White Paper as an “ambitious new step”, in an article explaining the changes.

So why does this matter? In short, we haven't built enough homes in the right places to meet demand. Evidence suggests that if we solved the housing crisis GDP per capita could be as much as 30% higher in just 15 years if we built enough homes in the right places. That’s £10,000 extra on the average household income.

But what’s this got to do with entrepreneurship? Helpfully, Sam Dumitriu has an excellent article on our blog explaining why entrepreneurs should back planning reform. In essence: planning policy has driven up the cost of talent in places like London, Cambridge and Oxford; reduced the innovation we see in tech clusters; and pushed up the cost of office space. Sam calls on UK entrepreneurs to get involved in the debate in the same way that Patrick and John Collison (Stripe founders), Jack Dorsey (Twitter founder), Marc Benioff (Salesforce founder), and Reid Hoffman (Linkedin founder) have in Silicon Valley. If you’re the UK’s equivalent – get in touch.

A White Paper isn’t law. There is a consultation which may change things. And Myers sounds a note of caution about the need to ensure homeowners are on board with any reforms: “We will only have plentiful, high quality, affordable housing when building new homes is truly popular with the locals. To achieve the two percentage point boost to annual GDP growth that eminent economic historian Nicolas Crafts says better planning would deliver, we would need to go further than this White Paper and adopt bottom-up processes to unleash a popular wave of new building.” (Read Nicholas Crafts on housebuilding in The Guardian for more on this.)

Emma Duncan offers a louder note of caution in The Times. She thinks the Government's solution to nimbyism involves too much centralisation and would be better solved by allowing councils to keep more of their money. “If more houses and flourishing businesses brought revenues back to local communities, rather than just spoiling the view and clogging the roads, people would be more enthusiastic about economic growth happening near them.”

She may be right, but hopefully this is the new debate. Not whether we need to build more – that should be a given – but how to do it best. To build back better, first we must build.

Read the whole thing here, and sign up for the newsletter here.

Why entrepreneurs should back planning reform

In April, legendary technologist Marc Andreesen declared that “It’s time to build”. A new White Paper “Planning for the Future” suggests the government is answering the call. While there is still a risk that the radical reforms to the planning system will be watered down as the White Paper becomes legislation, the plans have the potential to make a big dent in the UK’s housing shortage. If successful, it could have massive positive impacts on innovation and entrepreneurship.

Housing is a key issue for founders in Silicon Valley. Stripe founders Patrick and John Collison donated $1m to California YIMBY, a pro-development group co-founded by GitHub CEO Nat Friedman. In 2018 more than 120 tech leaders including Twitter founder Jack Dorsey, Salesforce founder Marc Benioff, and Linkedin Founder Reid Hoffman signed a letter in support of SB 827, an unsuccessful law that would have made it much easier to build near public transport in San Francisco. Yet, strangely, entrepreneurs in the UK tend to avoid the housing debate.

This is unfortunate, as restrictions on development are a major barrier to entrepreneurship and innovation in the UK. We have made it extremely difficult to build in places like London, Oxford, and Cambridge, which are our most productive cities.. According to the Greater London Authority’s Housing In London report, in the last two decades the number of jobs in London has grown by 40% and the number of people by 25%, but the number of homes by only 15%. As a result, rents are high and most young people’s only hopes of owning a home is through inheritance or moving away from the UK’s most productive regions. 

This has a knock-on effect on entrepreneurship in a few key ways. First, high rents push up labour costs making it harder to attract talent from elsewhere. We’ve priced many people out of the places where it is easiest to start a business in terms of access to contacts, capital, and knowledge. We’ve spoken a lot about how to lift sluggish productivity levels in the UK, but they all pale in comparison to increasing housing supply in London and the South East. A study from Enrico Moretti and Chang Tai-Hsieh analysed 220 US metropolitan areas from 1964–2009 and found restrictions on new housing supply cut aggregate US economic growth by more than a third between 1964 and 2009.

Second, this is particularly bad news for innovation. Another study from Enrico Moretti finds innovators are more productive when they move to tech clusters like San Francisco. Using advanced statistical techniques, he finds that if inventors couldn’t move to tech clusters the annual number of patents produced in the US would be 11.07% smaller. Restricting development around Oxford and Cambridge means fewer ideas for entrepreneurs to bring to market. As Stian Westlake once tweeted: “If you want to increase R&D, or improve "tech transfer", I strongly suspect that planning reform in Oxford, Cambridge etc would get you a better return on your political capital and £££ than ...most classic science & innovation policies.”

Third, a lack of development has also pushed up the cost of office space. LSE economists Paul Cheshire and Christian Hilber note that “office space in London is not just more expensive than anywhere else in the world; it is some three times as expensive as the next most expensive city in Europe, Paris, and more than three times as expensive as in Manhattan.” The problem isn’t isolated to London either. “Birmingham was the next most expensive European city after Paris, and Glasgow, Edinburgh and Manchester were all more expensive than Manhattan.” 

Some argue that planning isn’t to blame. For instance, the Town and Country Planning Association and Local Government Association both point to high rates (90%) of acceptance for planning applications and a backlog of a million homes with planning permission.

But their numbers are misleading. High rates of acceptance do not take into account the applications that are never made. The high cost of acquiring planning permissions deters all but the applications most likely to succeed. The acceptance rate for applications to McDonald’s Hamburger University is lower than the acceptance rate for Oxford, but it’s obvious that this tells us little about the relative ease of getting into either institution.

Similarly, developers ‘sitting’ on planning permissions are a direct consequence of the unpredictability of the planning system. As we saw with the Brexit debate around Just-In-Time manufacturing, small delays can cause havoc for supply chains. The risk of planning permission being withdrawn at a late stage makes it rational for developers to hold back projects to build up a pipeline. Without a pipeline, a developer may end up paying for materials, land, and labour they can’t use. This problem has forced many smaller suppliers out of the market as planning has become more restrictive. Thirty years ago small builders were responsible for 40% of new build homes, today it’s 12%.

The government’s proposal would remove the discretionary nature of the planning system by moving to a zoning approach where development is ‘by right’ opposed to subject to a lengthy approval process. It replaces protracted Section 106 negotiations for affordable housing with a simple flat-rated tax. It’s not NIMBYproof, but it’s a positive step.Entrepreneurs should root for it to succeed, because by making it easier to build in our most productive we can increase access to talent, cut office costs and boost innovation.

Supporting Female Founders Through COVID-19 And Beyond

As lockdown restrictions begin to ease for businesses, the Treasury is starting to think about how public finances can be put back on a sustainable footing. In this week’s blog, we cover the proposal for an online sales tax, a new study into childcare issues during lockdown, and share the latest updated COVID-19 guidance from the Government.

Female Founder Highlights

Here is a quick wrap up of this week’s news highlights, featuring some of our inspiring Members:

• A new study suggests that 1 in 4 parents have considered giving up work or reducing their hours due to childcare issues during lockdown. Commenting on the study, Justine Roberts, founder of Mumsnet and Female Founders Forum Member, said “lockdown was tricky for nearly everyone, but for parents of young children it was nerve-shreddingly difficult”. You can read the full NewsChain article here.

• Laura Tenison, our Member and founder of JoJo Maman Bébé, a leading boutique mother’s and baby omni-channel retailer, appeared on the Today programme to discuss the prospect of an online sales tax, like the one reported to have been proposed by the Treasury. In an Express article, Laura is quoted as saying “I think it's a great idea, but with some caveats”. You can read the full article here.

• Anne Boden, founder of Starling Bank and our Member, shared her views on the resilience of Wales’ tech sector in a roundtable discussion, supported by the Welsh Government. In a Business News Wales article, Anne said “we are now working very effectively remotely… I think there’s a chance for Wales to grab some of that opportunity from London”. You can read the full article here.

• Cofinitive, a corporate communications consultancy founded by Female Founders Forum Member Faye Holland has signed up as a Local Business Champion for Cambridgeshire. In a Cambridge Wireless article, Faye said “it’s never been more essential for businesses to have a voice, so it is important for us to be seen as a Local Champion”. Our virtual scale-up hubs are launching soon. For more information about our regional scale-up hubs, see our Barclays Opportunities section. 

Government Support

1. Small Business Leadership Scheme and Peer Networks

Small Business Minister, Paul Scully MP has announced two new training schemes designed to improve small businesses' management, productivity, and problem-solving skills. The two schemes are:

• Small Business Leadership Scheme - a 10-week virtual training programme delivered by university business schools; and 

• Peer Networks - a peer-to-peer networking programme for SMEs that is delivered locally by the network of Growth Hubs across England.

We covered the launch in our recent policy update.

2. Job Retention Bonus

The Government is planning to introduce a new Job Retention Bonus to provide additional support to employers who keep their furloughed employees in meaningful employment, after the Coronavirus Job Retention Scheme ends on 31 October 2020. 

The Job Retention Bonus is a one-off payment to employers of £1,000 for each employee they have previously claimed for under the scheme and who remains continuously employed through to 31 January 2021. Find out more about the eligibility criteria and more information about the Job Retention Bonus here.

3. Reporting outbreaks of COVID-19

The Government has released new guidance for businesses and organisations on how to recognise, contain and report incidents of COVID-19. The guidance has been published to ensure business owners:

• Know how to recognise and report an incident of COVID-19

• Are aware of measures local health protection teams may advise in order to contain it

Action cards have been developed to cover a range of business industries and provide tailored advice on the issues organisations may face now that lockdown restrictions are easing. You can download and print the action cards here.

4. Eat Out to Help Out Scheme

The UK Government has published new guidance for participating restaurants on how to claim reimbursement for discounts given to diners with the Eat Out to Help Out Scheme. Businesses can offer discounts through the Scheme to encourage diners to eat at their establishments. You can see examples of how to calculate the discount here. You can also register your business here. Registration will close on 31 August 2020.

Barclays Support and Opportunities

1. Female Founders Forum 2020 Digital Events

As you know, we have been busy re-invigorating our 2020 Female Founders Forum event schedule. We are pleased to announce the topics of our upcoming webinar series to support female founders through the UK’s economic recovery. Save these dates in your diaries:

• Access to Finance Webinar – exploring the barriers that Female Founders face when accessing finance and how policymakers and business leaders can address this as part of the UK’s economic recovery (10am - 11:30am, Thursday 3 September 2020)

• Attracting & Retaining Talent Webinar – fostering a strong culture to attract and retain talent isn’t new but we explore why it has never been more critical as the UK enters into the post-COVID world (10am - 11:30am, Thursday 8 October 2020)

• Building Personal & Operational Business Resilience Webinar – as the UK enters into a sustained period of uncertainty in the post-COVID world, we explore the importance of personal and operational business resilience (10am - 11:30am, Thursday 5 November 2020

• Cementing Your Story Webinar – exploring how brand narrative and entrepreneurial storytelling has evolved during COVID-19 and what approach entrepreneurs should take to building long-term prominence in the minds of consumers and investors (10am - 11:30am, Tuesday 4 December 2020

In each webinar, we will be joined by an eminent high growth Female Founders Forum member, an expert speaker and hear insights from Juliet Rogan, head of Barclays High Growth & Entrepreneurs team. 
 
We will be adding invitation links to our upcoming webinars in our Newsletters, so look out for these. If you are interested in attending a specific webinar, please contact jess@tenentrepreneurs.org and we will add you to the invitation list.
 
2. Eagle Labs Virtual Events

Barclays’ programme of virtual events covers a range of topics from cashflow management to building resilience to help entrepreneurs and start-ups navigate these uncertain times. Forthcoming events include a session on thinking differently about social media marketing and an event to demystify AI, machine learning, and machine intelligence. All events are free to attend and open to anyone. For more information visit the Eagle Lab event page.

3. Barclays Coronavirus Support Hub

The Barclays COVID-19 Support Hub provides the latest information, tools, and guidance to support businesses throughout the COVID-19 pandemic. This hub includes information about Barclays’ products, webinars, Facebook Live events, and more information on how to access government schemes. You can also download Barclays’ coronavirus checklist to support your business resilience planning throughout this period. There is also an updated FAQ section on this hub.

4. Balancing the Books Facebook Live event

With businesses adjusting to the ‘new normal’, Barclays hosted a panel event to discuss what the knock-on effect could look like for businesses and customers alike and what support is available to mitigate the challenges that lie ahead. Calling on an expert panel, panelists discussed the management of cash flow, the impact this could have on the supply chain processes, and how to diminish late payments.  You can watch a recording of this Facebook Live event to learn more. 

We want to inspire female entrepreneurs across the UK. Do you know any inspiring female entrepreneurs

Connect them to jess@tenentrepeneurs.org.

Charity Begins at Startups

Startups and charities tend to inhabit very different worlds, but some innovative entrepreneurs and third sector organisations are breaking down their silos, which is the subject of a great new report from our friends at Nesta.

Better Together shows how the third sector is experimenting with a range of collaboration models to engage with startups, such as co-working spaces, accelerator programmes and investment funds.

The Alzheimer’s Society, for example, has an Accelerator Programme that launched in 2018 supporting innovators to develop products or services that can benefit thousands of people affected by dementia. It offers investment of up to £100,000 and a 12-month programme with tailored support depending on the startup’s need, including the opportunity to test and develop products with people affected by dementia.

Entrepreneurs considering collaborations may want to scour the report for opportunities, such as the Friends of the Earth Experiments, The Children’s Society and Bethnal Green Ventures Partnership, and the UNICEF Innovation Fund.

Among the recommendations for policymakers is a tweak to the Charity Commission’s guidelines targeted at encouraging innovation in the sector. The report suggests that there is too much focus on mitigating risk, and guidance should be added on how trustees can support or encourage innovation, growth or increasing impact. For example, Charlotte Guiver of Versus Arthritis describes the current governance requirements as “immensely time consuming”, when discussing setting up an arms-length social venture.

Octopus's springboard 
Octopus is calling for the government to help create a plan to enable a 'nation of entrepreneurs' to support the UK’s post-pandemic recovery.

As Octopus co-founder Chris Hulatt sets out in The Times, the Springboard campaign is calling on the government to provide individual grants of £10,000 to create 100,000 businesses. Alongside this, they’re asking successful founders and companies to back the programme by offering mentorship to participants.

Chris and his co-founder Simon Rogerson are Advisers to The Entrepreneurs Network and have supported us since the very start. Springboard isn’t meant to be the last word in policies to ensure an entrepreneur-led recovery. As Chris concludes in his article: “Businesses big and small must work with politicians on a campaign to encourage and support new businesses. Providing a financial cushion — as well as networks and skills — is one idea that should work. There must be more great ideas out there. Let’s hear them.”

If you’d like to offer mentorship or support to the Springboard campaign, or would like to stay up to date with developments, you can sign up to the campaign here.

Don't spite
Sam Dumtiru has an article in City AM this week on why a digital tax is no way to reward our innovative online retailers. As Sam explains, “since the lockdown, thousands of small shops have used e-commerce to stay afloat and diversify their income when the government shut down their ability to trade physically. In fact, the government is rumoured to be looking at ways to build on SMEs’ shift online during lockdown.” Of course, business rates need reform, but hitting online retail with another tax isn’t the right way to save the high street.

Trading places 
Next year the transition period with the European Union will end. This means that controls will be placed on the movement of goods between Great Britain and the EU. With businesses somewhat preoccupied – what with one thing and another – the Government has decided to introduce the new border controls in three stages up until 1 July 2021.

The Border Operating Model provides the technical detail on how the border with the EU will work after the transition period and the actions that traders, hauliers, ports and carriers need to take. If you trade with the EU, you may want to take a look, although it's quite a long read. 

More digestible trade guides on how to import and export goods are available in the form of a ‘journey’, so that you can see steps you need to take to ensure that your goods are transported successfully. You can also use the checker tool to work out what actions your business needs to take.

What you really, really want
I’m always keen to get feedback about our work so we can do things better. To that end, it would be great if you could let us know what you think about our newsletters. What is useful? What is superfluous? What could be added? Are there any technical issues that we should fix? Anything that helps us do a better job of bridging the gap between entrepreneurs and policymakers. I’m all ears.

Read the whole newsletter here, and sign up here.

The Most Influential Women In UK Tech

Who are the most influential women in the UK tech industry? Computer Weekly has released its shortlist and unsurprisingly, it features many of our Members. In this week’s blog, we cover Computer Weekly’s 2020 Longlist of Influential Women in UK Tech, the Government’s plans to lift restrictions on businesses and updates to the Government's COVID-19 support schemes.

FEMALE FOUNDER HIGHLIGHTS

Here is a quick wrap up of this week’s news highlights, featuring some of our inspiring Members:

• Computer Weekly’s Most Influential Women in UK Tech: The 2020 Longlist has been released. Unsurprisingly, several of our Members have been shortlisted including Alex Depledge, Anne Boden, Debbie Wosskow, Emma Sinclair, Erika Brodnock, Faye Holland, June Angelides, Justine Roberts, Marta Krupinska, Tamara Lohan, Tania Boler, and Tugce Bulut

• Our Member, Marta Krupińska hosted a Google for Startups UK session showcasing 10 innovative tech startups from across the UK. Marta was joined by public and private investors who spoke about the challenges and opportunities that building startups all around the UK can offer. You can watch the full session here

• A new study by Streetbees, co-founded by our FFF Member Tugce Bulut uncovers what the British public really thinks about social distancing. You can read the article written by Tugce here

GOVERNMENT SUPPORT

1. Lifting restrictions for businesses in the UK

The Government has outlined a plan to lift restrictions from 1 August, if the virus remains around or below current levels and COVID-19 Secure guidelines are followed by businesses and the public. The Government plans to:

• Reopen most remaining leisure settings including bowling, skating rinks and casinos

• Give employers more discretion on how they ensure employees can work safely 

• Enable the restart of indoor performances to live audiences, pending the success of pilots

• Enable all close contact services to resume including make-up application

• Carry out pilots in venues with a range of crowd sizes including sport and business events

• Enable wedding receptions with sit down meals for up to 30 people

• Reopen schools, nurseries, and colleges for all children and young people

2. Face coverings at work

In last week’s blog, The Entrepreneurs Network covered how the mask mandate will help the UK’s high street. The Government has published guidance on face covering, the role in reducing transmission of COVID-19, and how they should be safely used and stored. This may be relevant to your business and you can read it here.

3. Eat Out to Help Out Scheme

Restaurants and other eligible establishments serving food for on-premises consumption can register for the Eat Out to Help Out Scheme. In order to be eligible, the establishment should:

• Sell food for immediate consumption on the premises

• Provide its own dining area or share a dining area with another establishment

• Have registered as a food business with the relevant local authority on or before 7 July 2020

Establishments who are taking part in the Eat Out to Help Out Scheme can use posters, images, and other promotional material here. Registration will close on 31 August 2020.
 
BARCLAYS SUPPORT AND OPPORTUNITIES
 
1. Female Founders Forum 2020 Digital Events
 
In light of COVID-19, we have been busily re-invigorating our 2020 Female Founders Forum event schedule. This year, we will be hosting a series of Webinars on key policy issues pertinent to our female founders to help support them through COVID-19 and beyond. 
 
We are creating 7 virtual scale-up hubs for regions across the UK, including Manchester, Birmingham, Leeds, Newcastle, Cardiff, Southampton and Edinburgh. The virtual scale-up hubs will bring together aspiring and established female founders through inspiring and engaging stories and content. 
 
We will keep you informed about the scale-up hubs and Webinars in our Newsletters. 
 
2. Barclays Coronavirus Support Hub

The Barclays COVID-19 Support Hub provides the latest information, tools, and guidance to support businesses throughout the coronavirus pandemic. This hub includes information about Barclays’ products, webinars, Facebook Live events, and more information on how to access government schemes. You can also download Barclays’ COVID-19 checklist to support your business resilience planning throughout this period. There is also an updated FAQ section on this hub.

3. Balancing the Books Facebook Live event

With businesses adjusting to the ‘new normal’, Barclays hosted a panel event to discuss what the knock-on effect could look like for businesses and customers alike and what support is available to mitigate the challenges that lie ahead. Calling on an expert panel, panelists discussed the management of cash flow, the impact this could have on the supply chain processes, and how to diminish late payments.  You can watch a recording of this Facebook Live event to learn more. 

4. Eagle Labs Virtual Events

Barclays’ programme of virtual events covers a range of topics from cashflow management to building resilience to help entrepreneurs and start-ups navigate these uncertain times. Forthcoming events include a session on thinking differently about social media marketing and an event to demystify AI, machine learning, and machine intelligence. All events are free to attend and open to anyone. For more information visit the Eagle Lab event page.

Entrepreneurs for Research

Which country has done the most to fight coronavirus? With a delayed lockdown, botched testing regime, track and trace failings, and one of the highest death rates per million, the UK probably wouldn’t be top of your list. But perhaps it should. Noted economist Tyler Cowen makes a strong case for why the UK’s response to COVID-19 has actually been world-class – at least in one crucial way.

Cowen specifically thinks the UK’s biomedical response has been remarkable, and that’s what matters most to the world. Whether this week’s preliminary results that the Oxford developed vaccine induces an immune reaction, or the trials of the cheap steroid dexamethasone, which have gone on to save lives around the world, he ranks the UK’s response number one.

While the UK and US are maligned across the world for their poor public health responses, Cowen thinks it’s interesting how few people lecture the Australians or the South Koreans for not having a better biomedical research establishment: “It is yet another sign of how societies tend to undervalue innovation — which makes the UK’s contribution all the more important.”

Being a world-leader has involved a lot of public and private sector R&D funding, and the government plans to double R&D to £22bn per year within five years. The challenge though, as set out in a recent Public First paper, will be sustaining this commitment in the face of fiscal events, elections and economic uncertainties.

Commissioned by the Wellcome Trust and Campaign for Science and Engineering, the report sets out how to practically garner support for continued spending. One idea is to encourage individuals and organisations from specific sectors to form coalitions, such as an ‘Entrepreneurs for Research’ group, which could make the case for why research funding matters to them or their business.

For most economists, the case for public funding for R&D is obvious: economic spillovers. The famous estimate from William Nordhaus is that innovators are only able to capture 2.2% of the total value to society of new inventions. This both explains why innovators are so important to society and should be celebrated, but also why some public funding is needed (ie. it can't be easily captured and is so not adequately incentivised)

History teaches us that in the battle of ideas, too often the wrong ones win out. Perhaps we need more than economic arguments. Perhaps we need that Entrepreneurs for Research group to ensure the UK continues to play a leading role in future global challenges. 

Cap or trade
Creator Fund has a report out this week which finds that 57% of founders who’ve passed through the venture capital firm’s doors have a foreign-born founder. This chimes with our research which found that 49% of the UK’s fastest-growing startups have at least one foreign-born co-founder.

Encouragingly, given the context of COVID, healthcare startups lead the way, with 16% of university startups in healthcare and a further 4% in biotech. There are lots of interesting facts in the pithy report, including areas where the Creator Fund’s investors would like to see more activity from university startups: improving clinical trials, culture meat and leather, gaming, technology solution for the elderly, and B2B SaaS startups.

The report finds Chinese students are most likely to start a company. As Chinese founder Shawn Du says: “I came here to Imperial to study because I wanted to start a company and thought the UK had the best talent for building my team.”

Yesterday, Onward, a think tank closely aligned with Theresa May’s leadership, put out a report arguing for fewer foreign students in UK universities – specifically Chinese students. Onward thinks British students are being crowded out by Chinese students. This is wrongheaded, as all the evidence shows that foreign students effectively subsidise more places for British students and research activity in our universities. 

In no other sector would anyone dare to call on the government to cap a successful British export of a UK product or service on such flimsy evidence. If there are impediments for the higher education sector in scaling to increase places, let's focus on those instead of capping exports.

Turning away the next generation of foreign-born founders would be a bad policy at the best of times – it would be tragic now.

GovStart 2020
PUBLIC has just opened its sixth-month growth programme to help tech startups transform the public sector. It takes startups at different stages and in various sectors, working with products that have powerful public sector applications, providing them with the tailored support, strategy and networks. Applications close in mid-August. Find out more here.
 
Apprenticeships
For the hundreds of you signed up to our Policy Updates, you might have seen one earlier today on the latest announcements around apprenticeships. It was written by Tim Smith from WhiteHat. It covers details on bonuses for hiring apprentices, greater access for SMEs and the dropping of the 50% university ‘target’. Read it here, and sign up to future updates here. And if you're an expert who would like to help entrepreneurs know how changes to legislation will impact their business, get in touch. 

Read the whole newsletter here, and sign up here.

Female Enterprise In Our New Economy

The Government has laid out a suite of policies to support the UK’s female entrepreneurs. We covered the Government’s efforts to support diversity in our blog last week. While the Future Fund’s diversity data is a step in the right direction, it is clear that there is still work to be done. In this week’s blog, we cover the launch of a new Female Ventures Fund, updates to the Government support schemes on offer, and highlights from our Members.

FEMALE FOUNDER HIGHLIGHTS

Here is a quick wrap up of this week’s news highlights, featuring some of our inspiring Members:

• The Women’s Enterprise Policy Group (WEPG), which represents leading experts and academic leaders across the UK, is urging the Chancellor to give women’s enterprise a voice and a seat at the policy table. In a Bdaily article Prof Julia Rouse, co-chair of the WEPG is quoted as having said “developing gender-responsive policy for women requires our expertise - we can help analyse how COVID-19 is impacting women-led businesses, monitor policy impact and help shape and implement policies that work for women”.

• Alternative investment fund manager Innvotec has launched a new fund to invest exclusively in female-founded enterprises. The Female Ventures Fund (FVF) is to invest in early-stage businesses founded or co-founded by women. The Seed Enterprise Investment Scheme (SEIS) fund will also look to encourage more women into the venture capital space.

• Julia Elliott Brown, our Member, and founder of Enter the Arena is running a series of podcast interviews with inspiring female entrepreneurs sharing their honest stories on equity fundraising. You can listen to the podcast series here.

• June Angelides, our Member and founder of Mums in Tech, has been named in Forbes list of 25 Leading Black British Business People To Follow. You can follow June on Twitter here.

GOVERNMENT SUPPORT

1. Summer Economic Update - Plan for Jobs 2020

The Chancellor presented his 'Plan for Jobs' to Parliament to outline how the government will boost job creation. 

The plan includes: 

• A Job Retention Bonus that will be introduced to help firms keep furloughed workers;

• A new £2 billion Kickstart Scheme of new, fully subsidised jobs for young people across the UK;

• A total of £1.6 billion invested in scaling up employment support schemes, training and apprenticeships to help people looking for a job;

• Bringing forward work on £8.8 billion of new infrastructure, decarbonisation and maintenance projects;

• A temporary increase to the Nil Rate Band of Residential SDLT (Stamp Duty) from £125,000 to £500,000;

• The rate of VAT applied on most tourism and hospitality-related activities will be cut from 20% to 5%; and

• A new Eat Out to Help Out discount to encourage people to safely return to earing out at restaurants.

Laura Tenison, our Member and founder of Jojo Maman Bebe spoke to News 24 about the Chancellor's Summer Economic Update, welcoming the meal reduction plan. "The best thing for me is the midday meal because we desperately want people out of their homes with any PPE who wish to wear and enter our stores."

2. Launch of the Sustainable Innovation Fund

The Government has launched a £200 million package to help innovative businesses bounce back from the impact of the COVID-19 pandemic and keep their cutting-edge projects and ideas alive. The Sustainable Innovation Fund will help power the UK’s economic recovery and develop new sustainable opportunities for businesses while also helping the UK to meet its ambitions to cut carbon emissions to net-zero by 2050. 

Businesses can apply for support through the Sustainable Innovation Fund here and find out more about the package here. 

3. More start-up and innovative firms will be eligible to apply for the Future Fund

The Future Fund’s eligibility criteria have been changed. UK companies who have participated in highly selective accelerator programmes and were required, as part of that programme, to have parent companies outside of the UK will now be able to apply for the Future Fund. Find out more here. 

4. Support for university research and innovation

The Government has announced 2 new packages to support research jobs and ground-breaking projects impacted by the COVID-19 pandemic. A new research funding scheme will open in Autumn to cover up to 80% of a university’s income losses from a decline in international students and around £280 million in funding will be made available to enable universities to continue their cutting edge research. Find out more here. 

 BARCLAYS SUPPORT AND OPPORTUNITIES
 
1. Female Founders Forum 2020 Digital Events
 
In light of COVID-19, we have been busily re-invigorating our 2020 Female Founders Forum event schedule. This year, we will be hosting a series of Webinars on key policy issues pertinent to our female founders to help support them through COVID-19 and beyond. 
 
We are creating 7 virtual scale-up hubs for regions across the UK, including Manchester, Birmingham, Leeds, Newcastle, Cardiff, Southampton and Edinburgh. The virtual scale-up hubs will bring together aspiring and established female founders through inspiring and engaging stories and content. 
 
We will keep you informed about the scale-up hubs and Webinars in our Newsletters. If you know any inspiring female founders in these regions, send them through to jess@tenentrepreneurs.org.

 2. Virtual Event – with Nicky Goulimis (co-founder and COO of Nova Credit)

Nicky Goulimis, the Co-Founder and COO of Nova Credit will be joining Juliet Rogan, Head of Barclays High Growth and Entrepreneurs, for an informative discussion on how to rapidly scale and expand your business. In this session on Thursday 9 July at 5 pm, you’ll find out how Nova Credit went from light-bulb moment to a $50m Series B funding round, and learn more about Nicky’s experiences as a successful female founder. To sign up for this event, please register here.

3. Barclays Back to Business Programme
 
Barclays has launched a free toolkit to help small and medium-sized enterprises (SMEs) across the UK get back on their feet as they navigate the uncertainty created by COVID-19. The ‘Barclays Back to Business’ programme has been designed in partnership with the Cambridge Judge Business School and is open to all UK SMEs. The toolkit is designed to help business owners assess the overall health of their business, and create a tailored resilience plan for challenging periods. It is packed with practical tools including a working capital calculator, cash flow forecasts, and guidance on managing supply chain relationships.
 
Register your interest here. Cambridge Judge Business School will get in touch to confirm your place on the programme, including how to access the online platform, which launches on 22 June 2020. For more information, check out Barclays Back to Business Programme.

 4. Barclays Coronavirus Support Hub

The Barclays coronavirus support hub provides the latest information, tools, and guidance to support businesses throughout the coronavirus pandemic. This hub includes information about Barclays’ products, webinars, Facebook live events, and more information on how to access Government schemes. You can also download Barclays’ coronavirus checklist to support your business resilience planning throughout this period. There is also an updated FAQ section on this hub.

Fixing Leviathan

Here’s an idea. Let’s scrap (nearly) every tax – whether on individuals or businesses – and replace it with a progressive consumption tax. Ed Conway proposes this in The Times today, but it’s a very British idea that’s been circulating since at least from the time of Thomas Hobbes.

In Leviathan, Hobbes argued that we should tax consumption as it’s the material manifestation of the enjoyment of life. Like so much of his thinking, it has stood the test of centuries, though we now have a few additional reasons to think it’s a good idea. Famed British economists of the last century Nicholas Kaldor and James Meade have shown that consumption taxes provide significant efficiency gains. A consumption tax eliminates the incentive to consume things now by ending the tax on savings, and reduces the effective tax on capital encouraging greater investment, which in turn leads to economic growth.

It may sound like an idea that only the rich could get behind, but as The Economist reported a decade ago Robert H. Frank posited it as a solution to inequality, and others, like Isabel Correia, have argued it could include a lump-sum transfer like a universal basic income. We could afford to pay for the progressiveness of this on the back of higher rates of economic growth.

At the end of the year we will properly leave the European Union. The last-minute deal that will presumably be struck with the EU and other Free Trade Agreements will mean there will be many areas where we’ll be limited on what we can do, despite Brexit. Often, though not always, this is to our advantage, but we will be able to go it alone on taxation.

Completely overhauling the tax system would be no mean feat. But then again, neither is exiting a trading block during a pandemic.

Masking the truth
Sam Dumitiru makes a forceful case on our blog as to why the government is right to make face coverings mandatory in all shops and supermarkets from next Friday. It’s a rebuke to the Telegraph journalist Timothy Stanley and others who are refusing to shop because of it.

The choice isn’t between wearing masks and continuing our lives as we did before the pandemic. It’s between wearing masks and the need for more stringent curbs on freedoms – including more lockdowns. It’s perplexing that an unmerry band of conservatives are shirking this very minor duty at a time of national crisis, and that an even less merry band of self-styled libertarians prefer to be locked in their homes than wear a bit of cloth on their face.

Luckily, they are in a tiny minority. Sam’s article cites opinion polls showing that people feel safer with masks. Britain’s high street entrepreneurs need people to feel safe to return – masks do exactly that.

Silver linings
What a difference a crisis makes. As we argued in Upgrade, businesses should be encouraged to make better use of digital technologies to tackle the sluggish productivity which characterised the pre-Covid economy and bounce back faster post lockdown.

As we noted, a lot of this is already happening. A new report from twillo confirms this, revealing that 97% of enterprise decision makers believe the pandemic sped up their company’s digital transformation, with 95% of all companies are seeking new ways of engaging customers. 

Businesses are busy pivoting. Isn’t it about time that government did the same?

FSB on EMBs
The Federation of Small Businesses has a report on the obstacles holding back the UK’s ethnic minority entrepreneurs. It finds that ethnic minority businesses (EMBs) contributed £25 billion to the UK economy at the last count – equivalent to the economic contribution of Greater Manchester – and are more likely to export than their non-EMB counterparts. However, EMBs are often detached from mainstream business support, and struggle disproportionately when it comes to accessing finance. 

We’ll explore some of the issues raised in this report – and others – in an event with the APPG for Entrepreneurship, supported by NatWest. We now have a time and date: 11am on 6th August. If you want me to send you a diary invite so you can save the date in your calendar just drop me an email. Speaker details to follow next week!

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Mask mandates will help the High Street

From July 24th onwards, face coverings will be mandatory in all shops and supermarkets in England. It’s move that’s been broadly welcomed, one poll found 80% of the public supported the mandate, and one that’s arguably overdue, Germany made them mandatory in late April. However, some people aren’t convinced. In the Telegraph, Timothy Stanley writes:

…the problem with this sort of “new normal” is that it aims to bring Britain back to life yet makes life so unpleasant that many people will prefer to stay away. In other words it repels at least as much as it attracts.

I hate masks but I respect other people, respect the law and will obey it – hence I’m going to avoid public transport for so long as it treats me like a highly infectious child. I’ll walk or, better still, decline all invitations.

On a similar note, IEA Director General and Times columnist, Mark Littlewood tweeted:

I don’t want to hear from anyone who backs this absurd move about “saving the high street” ever again. This is lunacy. I’ll be doing as much shopping as possible through Amazon from now on.

Objections to mask mandates tend to either be based on an appeal to liberty, or a belief that wearing a mask is so inconvenient that it will put people off shopping on the high street.

I disagree and I think masks will be key to securing the economic recovery. First, It’s important to understand why the economy has contracted. Whether the lockdown or the virus itself are to blame for the recession, may sound like splitting hairs, but actually has major implications for policymakers.

For instance, if people are staying home because of fear of the virus, then policies such as Eat Out to Help Out vouchers and VAT cuts will do little to coax people back out.  As the New Statesman’s Stephen Bush writes:

If you believe – as I do – that the cause of the downturn is the demand shock caused by people voluntarily observing social distancing and lockdown measures, then there’s a limit to what the government can do with fiscal stimulus. It’s much more important that they demonstrate that the virus is safely under control.

While it’s hard to deny that lockdown measures dampened economic activity, they don’t deserve all the credit. As Ryan Bourne notes for ConservativeHome:

Sweden, which didn’t lockdown to the same extent, similarly suggests voluntary distancing has been the key driver of downturns.  Data from Citymapper  shows that transport mobility in Stockholm fell 70 percent by the start of March. Travel to  the holiday island of Gotland was down 96 percent  compared with Easter last year, despite no government orders banning it.

…

Here, OpenTable data shows that UK restaurant bookings fell 82 percent by March 17th against last year, a full three days before Boris Johnson closed restaurants.  City Mapper  shows mobility in London had fallen 75 per cent the day before full lockdown was announced, with Manchester and Birmingham exhibiting similar patterns.

Ryan points me in the direction of a new study that tries to quantify the respective impacts of voluntary and involuntary social distancing. In “Private Precaution and Public Restrictions: What Drives Social Distancing and Industry Foot Traffic in the COVID-19 Era?” economists Christopher Cronin and William Evans find that mobility data:

…at the national and state levels start to change dramatically in a short window from March 8-14, well before state or local restrictions of note are in place. 

Specifically, the data shows:

Private, self-regulating behaviour explains more than three-quarters of the decline in foot traffic in most industries. Restrictive regulation explains half the decline in foot traffic in essential retail and 75 percent of the increase in the fraction home all day. In this latter result, public school closings have a substantial effect.

NB: (For a UK focused analysis, see this great Bank Underground post - HT Mike Bird)

If mandatory mask use can then reduce the risk of catching the virus (and evidence suggests it can), then it will reassure consumers and increase high street activity. This isn’t to say there aren’t costs to face masks, many people find them uncomfortable, and they can be particularly inconvenient for glasses wearers. But, if fear of the virus is keeping people at home, then the benefits will likely outweigh the costs.

A new poll from Kekst CNC suggests that mask mandates may make people feel safer. Of those polled, 42% said seeing other people in masks made them feel reassured, while just 5% said they made them feel scared or less safe than usual.

Of course, if mask mandates reassure consumers, it prompts the question – why haven’t shops imposed them anyway? The issue is you only benefit from reassuring customers if you can advertise your mandate. This isn’t easy and unless you have a direct route of communication with your customers, it isn’t cheap. As a result, shops that decide to go it alone receive few benefits, while at the same time losing out on the non-mask wearing trade (unless they provide the mask themselves).

Furthermore, the mandate will also reduce virus prevalence more generally, reducing the risk you’ll come into contact with a coronavirus carrier, masked or otherwise.

But even if you take the view that lockdown rules take most of the credit for changes in consumer behaviour, you should still welcome mask mandates as by reducing R they make outbreaks, and by consequence, lockdowns, less likely.

Upgrade

The big news for entrepreneurs this week was the launch of Upgrade, our new report on closing the digital gap and lifting productivity for SMEs, which was launched at a packed Webinar by Paul Scully, the Small Business Minister.

Ok, maybe the Chancellor’s the Summer Statement pips it to the post. But you can read about both in my article for City AM on why we need a productivity revolution. I argue that the real test of this government comes next, and will require reforms across all areas of government that put increasing productivity at the centre of our economic recovery.

(You can find out more details about how the Job Retention Bonus, Kickstart Scheme, and other Summer Statement announcements will impact your business in our latest Policy Update.) 

The best explanation of Upgrade, which was commissioned by Xero, comes from our research director and author of the report Sam Dumitriu. In his CapX article Sam discusses how Upgrade highlights the potential to raise wages through increased digital adoption among the UK’s SMEs. 

Analysing the Enterprise Research Centre’s Micro Business Britain survey, the report finds that the 4.09m workers employed by micro businesses would receive a £4,050 average productivity boost if digital adoption rates among micro businesses were doubled.

This isn’t a pie in the sky ambition – EU data reveals the UK has a particularly large proportion of businesses (38%) with very low levels of digital adoption compared to countries like Sweden and the Netherlands, where just over a fifth (23%) of firms have very low levels of digital adoption. While in Finland, just one in ten (11%) have low levels of adoption. 

We think this represents some relatively low-hanging fruit for the economic recovery. Not least, because so many businesses are already undergoing digital transformations due to the pandemic. But we have nine policy recommendations in the report to ensure it sticks and have produced a handy two-page summary if you don't have time to read the whole report. Also, here’s Sam explaining a few of them:

“Upgrading the UK’s SMEs will require making it easier to finance digitisation by modernising the R&D tax credit’s 70’s style definition of research. It will also mean making it easier for workers to self-fund training and learn new digital skills. For instance, at the moment a graphic designer cannot claim tax relief for taking a course in digital marketing, even though it could lead to new business in the future.”

“It’s also important to make it easier for businesses to identify digital opportunities. Advice serves an important role, but the Government must not overstep its mark. Businesses are more likely to trust other businesses than politicians"...  "That’s why it’s important to outsource advice to trusted business organisations. Funding is useful, but delivery should be left to the real experts.”

Eamonn to that
If one report on how new technologies can help tackle Britain’s productivity isn’t enough for you, Eamonn Ives of the Centre for Policy studies has another for you: Platforms for Growth.

Among other things it calls for an urgent review of the Apprenticeship Levy to ensure employers use funds to invest in digital training that will deliver recognised productivity benefits for their businesses, and a comprehensive new cyber security strategy to take effect after 2021 to provide reassurance for those who operate online.

Free lunches
Emma Jones, Founder of Enterprise Nation and Adviser to the network, has pulled out the stops again, launching the Recovery Advice for Business scheme.

The Recovery Advice for Business scheme, which is supported by the Government, will give small firms access to free, one-to-one advice with an expert adviser to help them through the pandemic and prepare them for long-term recovery.

Advice offered will include accountancy, legal, advertising, marketing, recruitment and digital. It is free until the end of the year and is supported by ICAEW, CIPD, The Law Society and the Advertising Association.

Are you a startup looking to raise £300k to £3m? KPMG and Central Research Laboratory have an intensive 3-day programme – packed with founder talks, VC clinics, pitch coaching, financial reviews and negotiation workshops, aiming to give you the tools and knowledge to successfully raise your next major round of investment. Find out more and register to apply through Eventbrite.

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Make Lockdown Switch to Digital Permanent to Secure Economic Recovery

A new report from The Entrepreneurs Network, commissioned by cloud accounting platform Xero, argues that small firms should make better use of digital technologies to tackle the sluggish productivity which characterised the pre-Covid economy and bounce back faster post lockdown.

Upgrade: Closing the digital gap and lifting productivity for SMEs reveals:

• If the 1.1m micro-businesses (0-9 employees) doubled their uptake of key digital technologies, the UK economy would get a £16.6bn boost.

• This would restore four-fifths of lost productivity growth since the financial crisis, and enable businesses to bounce back faster post-lockdown.

• The small business response to lockdown with shops switching to selling online and offices going remote shows that major digital transformation is achievable.

• As the economy reopens, it is vital that the switch to digital becomes permanent and more small businesses make the most use of the right digital tools.

• The report calls on the government to widen the scope of the R&D tax credit to make it easier for SMEs to invest in innovation.

• It also backs support for peer-to-peer learning initiatives so business-owners can overcome knowledge barriers by learning from entrepreneurs in similar situations.

• To tackle digital skill shortages, it proposes allowing tax relief for self-funded training and improving awareness of existing digital training programmes.

Upgrade shows many small firms are failing to make use of the right digital tools.  It finds that although the UK is one of the world’s most innovative economies hosting over 70 tech unicorns, over a third (38%) of small businesses are not adopting tried-and-tested tech.This is important because if the UK’s 1.1 million micro businesses doubled their uptake of key digital technologies it would lead to a total £16.6bn boost to the economy. This amounts to a £4,050 average productivity boost for the 4.09m workers employed by micro businesses, restoring four-fifths of lost productivity growth between the financial crisis and the lockdown. 

While the UK's productivity has on average underperformed relative to other major economies, top-performing UK companies are on par with the most productive businesses in the world. The problem is the large gap between the UKs ‘leaders and laggards’. Technology adoption is a similar story. Although the UK is home to world-leading tech businesses, many SMEs do not do the basics.

Over a third (38%) of UK SMEs have very low levels of digital adoption. According to the EU’s Digital Intensity Index, which measures the use of digital tech by businesses, many lack a website, social media presence, or fast broadband. By contrast, in Sweden and the Netherlands just over a fifth (23%) of firms have very low levels of digital adoption. In Finland, just one in ten (11%) have low levels of adoption.

Sam Dumitriu, Research Director at The Entrepreneurs Network and author of the report, says:

“Recent events have highlighted the importance of digital technology in enabling businesses to continue trading in the most difficult of circumstances. It is now time to take advantage of a massive opportunity to boost productivity by increasing the rate of digital adoption. “Britain is a world-leader in innovation, but too often best practices are not spreading to all SMEs.”

Gary Turner, UK Managing Director, Xero says:

“One of the achievements of so many small firms in recent months has been how they have been able to pivot their business models to operate differently. They are discovering new digital ways to achieve greater value, scale and resilience. 

“As the economy reopens and small firms look to rebuild, we must close the digital divide to help small firms bounce back more quickly. Hence, the lessons in this study on how we can encourage firms to make more use of the right technology are more important than ever.”

Policy recommendations

We identify three key barriers to digital adoption: knowledge, skills, and finance. The report recommends nine policies to ensure that businesses have the information to identify digital solutions, the finance to invest in them, and the skills to implement them:

Knowledge

1. Prioritise support for peer-to-peer learning initiatives. Peer-to-peer learning is a tried and tested approach for increasing SME adoption of business best practices.

2. Outsource the provision of advice to trusted groups. This should be delivered through trusted business organisations.

3. Do more to leverage relationships between SMEs and accountants. Accountants are often a trusted source of information to SMEs.

Skills 

1. Allow tax relief for self-funded training. This would make self-funded training cheaper and bring the UK’s tax-code in line with other OECD countries. It could be limited to pre-approved digital training schemes to ensure that the goal of increasing business productivity is prioritised.

2. Improve awareness of and access to digital training. The government should trial different approaches to see what best increases the uptake of different schemes

Finance

1. Ensure better awareness of tech grant schemes. SMEs often struggle to keep up with schemes on offer as they change so the government should make sure that the messaging on future grant schemes is effective.

2. Improve the impact of tech grant schemes. The government should increase the impact of these schemes by tying funding to participation in knowledge-sharing networks.

3. Allow R&D tax relief for user interface and user experience development work. Businesses should be allowed to claim R&D tax relief on digitisation projects.

4. Improve the promotion and access to R&D tax credit schemes. HMRC should provide clearer feedback on rejected applications.

Big Deal

Boris Johnson is promising to "build build build". Aping President Franklin D. Roosevelt, Boris has a ‘New Deal’, “to build the homes, to fix the NHS, to tackle the skills crisis, to mend the indefensible gap in opportunity and productivity and connectivity between the regions of the UK". 

Chancellor Rishi Sunak will put some more meat on the bones of this announcement in next week’s summer statement. As recommended in last week’s newsletter, he is expected to focus on efforts to support employment. 

The Chancellor is believed to be examining options to encourage companies to hire young people. The most straightforward way to do this would be a wage subsidy for companies taking on new staff or preserving jobs. An alternative could be a cut to employers’ national insurance contributions, although the concern will be that it might not translate into new jobs. Whatever is announced on Wednesday, we will let you know how it impacts entrepreneurs via our Policy Update (our latest on more support for startups can be found here). 

One tweak could be around the Apprenticeship Levy. Former MP Nick Boles is calling on the government to deliver an apprenticeship guarantee for young people by allowing employers to use apprenticeship levy funds to pay the first year’s wages for all new apprentices under 25, while Robert Halfon MP argues in the FT that the Prime Minister should offer an apprenticeship guarantee to every young person.

The Apprenticeship Levy certainly needs reforming. It requires employers with a payroll of over £3m to pay 0.5% of their wage bill to fund apprenticeships, but it’s not incentivising employers to take on apprentices. The government responded to its failings in 2018 by allowing levy-paying employers to transfer 25% of their levy payments to employers in their supply chain, but this didn’t go far enough.

We argued in Management Matters that companies should be able to transfer 50% of their levy along the supply chain and that the Levy should be rebranded as a more flexible general training levy to allow greater flexibility in terms of appropriate training – particularly shorter courses. Sajid Javid called for something similar in his recent, extensive Centre for Policy Studies report After the Crisis.

Putting the economy in stasis was exactly the right reaction when the virus hit. It’s now clear that we need to tap into the agility of entrepreneurs building products and delivering services to meet changing demands taking place across our economy. Whatever is announced next week, the focus shouldn’t be on stimulating demand for what people wanted before Covid-19 – it needs to be about empowering entrepreneurs to adapt to a world in flux.

Go with the flow
The British Library’s Start-ups in London Libraries delivers webinars and across 10 borough libraries. The aim is to provide information access and support for individuals and start-ups looking to start and build their businesses, especially focused on disadvantaged groups. They are looking for an expert to volunteer to provide a training session on cash flows and balance sheets for startups. If you willing and able to lend a hand – or you know someone can – drop them an email.

Spider, man
The Postcode Lotteries Green Challenge has announced the 25 start-ups that have made it through the first stage of the international competition supporting green entrepreneurs. Seven of the companies are British, including Jiva Materials, which is manufacturing the world’s first fully recyclable printed circuit board to easily and safely recover precious metals, and Spintex, which through a spider inspired process artificially spins the high performance silk fibres. If you like your glass half full, check out all the amazing nominees' innovations.

We believe entrepreneurs will be key to solving many of the world’s biggest challenges – including environmental ones. That’s why we’re busy undertaking a research project on green entrepreneurship with the Enterprise Trust. Find out more here and drop Eamonn Ives an email if you want to get involved.

Startup steps from h
Disruption, The Panoply and h Foundation have developed the Future Leaders Programme in response to coronavirus. It is focused on supporting 21 to 30-year-old entrepreneurs who are BAME, from a low-income background or who have a disability. The 9-week fully digital programme includes a £200 per week bursary, a mentor, workshops and a final pitch event. Apply here.

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Diversity and the Future Fund

Back in April 2020, Emma Sinclair MBE, one of our Female Founders and Hephzi Pemberton started a petition calling on the HM Treasury to align the Future Fund with the diversity agenda. In their open letter to Rishi Sunak, they raised some serious concerns that the Future Fund could exacerbate existing inequalities for the UK’s diverse founders. Namely, that diverse founders are less likely to have raised at least £250k of funding already, less likely to have ‘warm introductions’ and therefore less likely to have access to the Future Fund. 

In an article for Sifted, John Glen MP, Economic Secretary to the Treasury, signalled his commitment to ensuring the Future Fund did not only benefit established, male-dominated, London-based businesses. He said that the Fund would support female founders by becoming a signatory of the Government’s Investing in Women Code and provide monthly reporting on the diversity of recipients, including regional spread. 

The British Business Bank has published its first set of data on the 252 companies who have been approved for matched-funding from the Future Fund.

So did the government’s efforts to support diversity work?

On a positive note, 79% of funding went to companies with mixed gender management teams. However, if we look at the data for all-women management teams, just 3 have received funding out of the total 252. By contrast, 66 all-male management teams received funding. 

As Amy Lewin noted in her Sifted article on the Future Fund’s first set of diversity data, it is worth mentioning that the data applies to the ‘senior management team’ - not just founders. By contrast, when we track the equity funding gap, we only focus on startups with female founders. This means that the headline statistics are slightly more favourable for the government.  

When it comes to ethnicity, 113 teams were of mixed ethnicity, 109 were all-white teams and only 12 were all-BAME. 

On the diversity of the fund, Deborah Okenla, founder of YSYS said to Amy Lewin in her Sifted article that “it’s a positive start to see The Treasury commit to collecting and publishing the data. We can see from the data that we still have a long way to go. And we need to understand what the data shows for specific groups, such as black founders within the BAME categorisation, and move beyond binary gender.”

The Extend Ventures and YSYS Report on the impact of COVID-19 on Diverse Founders Startups revealed that almost half (48%) of BAME business owners did not expect to access or qualify for any government support schemes.

In our latest FFF Newsletter, we covered Erika Brodnock’s thoughts. Erika is co-founder of Extend Ventures and one of our Female Founders. Speaking to Amy Lewin from Sifted, Erika said “For too long, minority entrepreneurs have remained unsupported and have needed to ‘fend for themselves’... we need to ensure this isn’t going to be the same for newer businesses”.

So how can we change the status quo? 

With support from Barclays, we are continuing in our efforts this year to provide female entrepreneurs with the support, advice and networks they need to succeed. We will be sending out invitations to our digital events in our FFF Newsletter, which you can sign up to here.

BAME entrepreneurship policy overlaps with some of our previous work on immigrant founders – and Sam Dumitriu has just written an excellent article making a powerful case for why we should let asylum seekers work – but, of course, it is also about British-born BAME entrepreneurs. 

With support from NatWest, we’re also putting together an APPG for Entrepreneurship Webinar on BAME entrepreneurship. You can register your interest by dropping us an email. We hope and expect that this will be the start of some more focused policy work.

Just the Job

As the economy slowly opens up, entrepreneurs will need access to workers with the right skills to drive the recovery.

To that end, the CBI has released a report on Building a World-Class Innovation and Digital Economy. It measures the UK against the other G7 countries and is packed full of familiar policies that we back. One that stood out, which I’ve not discussed here before, is transforming Job Centres (now Jobcentre Plus) into Jobs and Skills Hubs. 

Jobs and Skills Hubs would harness the expertise of colleges, universities, unions, businesses, and Local Enterprise Partnerships to provide the rapid matching of people to new job opportunities and sourcing high quality training in areas of future demand in the local labour market. As furlough is withdrawn, this could be vital for supporting the rising number of unemployed.

This brings to mind a recent article by Jonathan Portes and Tony Wilson, which calls for us to ape successful countries like Denmark in the way we support employment. But as with any reforms like this, the devil is in the implementation. As Heather Rolfe from the think tank Demos argues: “For this to work, the low-grade box-ticking ‘employment skills’ courses where participants repeatedly write CVs, need replacing by real training courses, leading to technical skills and designed and delivered in partnership with local colleges and employers.”

Job Centre reform won't grab as many headlines as a cut to VAT (which is looking increasingly likely), but it would probably be a better use of limited resources. As Ryan Bourne argues in The Telegraph: “the government would get far more “bang for the buck” diverting funds into actively encouraging new hires or at least offering retraining or job-matching services for workers who find their old roles defunct.” (If you're still not convinced about the limited economic benefits of cutting VAT, read Edward Troup's dissection of the idea).

Lunch and learn
On Tuesday, Viscount (Matt) Ridley and Dr Anton Howes will discuss how innovation works. I can’t wait for this one, as I grew up devouring Matt’s brilliant books. I would particularly recommend The Red Queen: Sex and the Evolution of Human Nature. He will be discussing some of the ideas in his new book, titled appropriately enough, How Innovation Works. 

Anton has started working with us as Head of Innovation Research, but he is first and foremost one of the UK’s experts on Britain's acceleration of innovation that gave rise to the Industrial Revolution. His first book has just been published. Arts and Minds tells the story of Britain's subscription-funded national improvement agency, the Royal Society for the Encouragement of Arts, Manufactures and Commerce (RSA).

It’s bound to be a fascinating discussion. It’s at 1pm on Tuesday, so you might want to tune in over a spot of lunch. Find out more here.

Level heads
Levelling up investment across the country will require level heads. As Sam Dumitiru writes on our blog, for every success story like Israel’s famous Yozma programme, there are a dozen failed attempts where public money has been wasted with little to show for it. Drawing on the work of Josh Lerner, Sam details the common pitfalls of governments using venture capital to level up and concludes that we should limit interventions to match funding with the private sector. Read it here.

Design for life
The British Design Fund has got in touch about an opportunity to apply for the 2020 global Design Intelligence Awards, hosted by the China Academy of Art. These awards recognise innovation in four categories: cultural innovation, living wisdom, industrial equipment and digital economy, and are designed for both established businesses with products in market and early stage innovators with prototypes capable of being brought to market. 

Ben Griffin, Innovation Lead for Design at Innovate UK, is one of the judges. The deadline is 6 July and last year’s winner Open Bionics, which is developing the next generation of bionic limbs, took home 1 million Yuan (around £115,000). Find out more here.

Seeing the wood
Our friends at Enterprise Nation have announced the Amazon Small Business Accelerator, a major support package for 200,000 small businesses across the UK. By joining the programme you can access a bundle of business offers worth over £2,000. Find out more here.

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