View from a small business (1)

Note: This post first featured on “The Art of…” blog, under my name: David Atkinson

Aside from my “freelance thinking”, I am also a hands-on entrepreneur/business owner-manager. My own (service-sector) business has developed from a single-person consultancy – in which I provided project and risk management consultancy services under sub-contract to major European and UK-based engineering projects – to a specialist mergers and acquisitions business.

Together with the more philosophical posts on this blog, I also hope to bring some sense of an SME’s reality to the fore – a personally perspective of being “in business”. What is it that I, as a business manager, find to be of concern to me? Am I bothered about the amount of “red tape”? How did I go about some aspect of my business; how was it that I solved some particular issue? Here, in the spirit of co-operation and mutual support, I also welcome any comment on this thread in the form of a new question that invites an answer.

However, to close this initial post, at the launch of the NorthernLeadershipAcademyI happened to meet with a most interesting individual. Our conversation turned to what I (and he) believed to be the most pressing concern of any small business trying to grow. How do I, as a small (unknown and perhaps unproven) business, attract the funds to develop new business ideas and concepts? This is not about leadership – unless one wants to examine who might lead in this case – it is about the raising of capital investment under conditions of risk. This particular individual commented that he had recently been involved with the establishment of a multi-million pound, grant-funded business development scheme. Such “venture finance” schemes are potentially the life-blood of innovation – certainly a potential contributor to any perceived economic “gap-closing” (regional or otherwise). Yet, where is the leadership required to develop innovation in the face of financial institutions and fund-managers that exhibit excessively risk-averse attitudes to investment? In the UKthere is at least a perception that our venture finance sector can be so risk-averse that they collectively feel their first role is the protection of the funds against adverse risk.

In my own business I was able to secure finance under the Government-assisted Small Firms Loan Scheme (as administered by the major UK banks). However, although my “new” business was less than 2 years old at the time of borrowing, as a legal entity (a private limited company) the company had existed for over 5. Changes in the Small Firms Loan lending rules now mean that while my business (at the time of writing) is “technically” still less than 3 years old, the company is no longer eligible for further such financing. The increase in the use of set “protocols” for the determination of decisions reduces the opportunity for the “intelligent” application of reason. It is a symptom of a risk-averse society in which we are increasingly devaluing the contribution of individual thought. We are continually constrained by policies that are driven by generalised, empiric observation. Is a potential net-effect a society where we no-longer need leadership (in business or politics)?