Yes, fourteenth – that’s where this year’s Global Entrepreneurship and Development Index places the UK.
The results are to be formally announced at an event at Imperial College tomorrow.
But those of us who are at the sharp edge of entrepreneurial development in the UK – and that doesn’t include academia, Whitehall, or the enterprise support industry – already recognise the sobering reality behind the enterprise hype. We are simply not in the leading pack.
The report identifies two key factors behind our poor performance. These are the poverty of early stage risk capital provision and a lack of strong entrepreneurial ambition.
At Funding Enterprise we try to deal with the consequences of the first shortage – early stage risk capital – just about every day. Central government is still directing enterprise resources into schemes and initiatives which see the funds soaked up in bureaucracy. Locally administered funds are going into the great morass of local authority payroll bloat which seems to splurge on regardless.
Our tax regimes lag beyond those of our competitors in encouraging investment.
The investment industry generally operates as a money gaming activity either parallel to, or at the direct expense of commercial growth. We lack deep and embedded seed capital capacity premised on steady and largely re-invested returns, not opportunistic and short-terminist slash and burn harvesting of under-ripe assets and merely emergent profits.
The report’s second chief criticism of the UK, lack of entrepreneurial ambition, needs some precise unpacking lest we perpetuate another of our systematic cultural failings.
I am referring to the Canute style of enterprise development: command and it will happen. Insist that there is an entrepreneur in just about everyone; continue to pour money into vacuous and generalist “business support” schemes; treat “entrepreneurship” in sprawling university business schools as if it is an asset class of stand-alone generation.
This sense that we can will an enterprise culture into existence is inane. There can be little improvement in “entrepreneurial ambition” until the conditions in which it can flourish are themselves first improved.
We neglect the Business Big Four, the real pillars of a productive economy, at our growing peril. These are:
Capital: everything from fuller tax breaks to regional private-public investment vehicles.
Skills: a concentration on STEM subjects in schools, a greater industrial vocational focus in universities, serious apprenticeship enhancements within all sectors but particularly in industry.
Regulation: a rolling back of the web of disabling regulation around commerce.
Trade: a huge gearing-up of effort around export.
Next time someone tells you that they are an entrepreneur or an enterprise champion, ask them what real economic value they have created in the last day.
Even more pertinently, ask yourself each morning what real commercial value you are going to create today.
Fourteenth is nowhere near good enough.