In the final instalment of this year’s The Apprentice, one of the less implausible finalists pitched a recipe-buying website which he speculated might be worth over a hundred million within five years, if successful. Sugar turned on him. “Get on an aeroplane to America,” he admonished. “They have an appetite for these kinds of mad, long term ideas. This country, we don’t have the venture capitalists and that kind of stuff to shove the money into it.”
“Mad” is a funny word for an investor to use. Most VCs – and there are several in London who may wish to make themselves known to Lord Sugar – learn the hard way that if the team is smart, the last thing you want to do is insult their baby. And it’s unclear in this case that Nick, a successful, creative and socially well-adjusted serial entrepreneur, had a business plan that was especially ugly.
Dozens of foodie sites have raised institutional money, most at valuations which dwarf the implied £250,000 pre-money that Sugar had in mind. Furthermore, any number of funded, high-growth start-ups have achieved nine-figure exit valuations within five years of inception. (When they succeed.)
But while it’s easy to dismiss reality television as more television than reality, Sugar’s intemperate advice has a grain of truth in it: American attitudes to business really are worlds apart from ours. It’s evident in the people we put on pedestals. When interviewing fresh-faced graduates who claim to want to run their own businesses, I routinely ask which British entrepreneurs have inspired them. Like the question about famous Belgians, nobody can name more than two.
Time and again I hear the names of Branson and Sugar, the twin peaks of British entrepreneurial attainment. But what kind of role models are these men for bright young graduates? One was educated at the school of hard knocks and the other at the University of Life; one was born with a trader’s nose for the deal and the other a media man’s nose for the story. Both are an awfully far cry from the stubbly set that code all day and party all night in Shoreditch.
Entrepreneurs tend to start companies in their own image. So it’s particularly disappointing that in a city like London, possibly the most sophisticated city on the planet, we aren’t doing a better job of giving profile to the smart, ingenious, creative types of entrepreneur rather than the cantankerous, aggressive ones.
We have a few who at least sometimes call the UK home: people like Mike Lynch (Autonomy), Niklas Zennstrom (Skype), Michael Birch (Bebo) and Bernard Liautaud (Business Objects), for instance. But we don’t put them on primetime TV shows. The only businesspeople given profile in the UK media, who regularly grace the business pages of the dailies, are the CEOs of M&S, Tescos and BP—impressive figures, no doubt, but captains of industry not entrepreneurs.
One thing that Sugar’s irascible management style does have in common with American entrepreneurship is its raw impatience. onefinestay has recently begun building its team in the US. The most notable thing to us, for junior and senior roles alike, is how quickly people can start once recruited. While key hires in London are typically obliged to work out two or even three months of notice, in the States periods of more than two weeks are almost unknown. That single fact dramatically improves labour mobility.
For a start-up with fast-changing hiring needs, it’s magical. But while regulation and market norms have an effect, those things are symptoms not causes. Underlying the lack of high concept entrepreneurship in the UK is a notable paucity of successful, high-profile entrepreneurs who have built businesses predicated on big ideas and the application of technology.
Ultimately, it’s only the people with such “mad, long term” ideas who succeed that have the potential to act as beacons for future graduates. It’s the success of last decade’s Stanford Computer Science class which inspires this decade’s intake. Entrepreneurship is an unfair game. A few win big, and almost none who does could not have succeeded elsewhere.
That in turn implies that we need to lure the best and brightest away from the arts, the old professions and the City. Yes they need to be aggressive. But more so, they need to be creative, thoughtful and collaborative. We need to encourage them to start world-class and world-changing businesses which are structurally innovative and use technology in novel ways. And we need to retain that top talent within the UK. All of which means we need much stronger public endorsement of “mad” entrepreneurship.
What better first step than to stop giving airtime to battle-worn tycoons? Let’s fill the designer lofts of Dragon’s Den and the minimalist boardrooms of The Apprentice with some successful “mad” entrepreneurs – the kind who took “mad” bets on “mad” technologies and achieved “mad” returns by doing so. We know it works in America. It would be more like today’s reality in the parts of London where innovation is happening. And it would make much better TV.