Note: This post first featured on “The Art of…” blog, under my name: David Atkinson http://davidsartof.blogspot.com/
Gateway to Investment (G2i) the London-based Investment Readiness Programme, have recently (1st July) issued a post relating to the UK Government’s plan for a UK INNOVATION FUND .
The G2i post prompted me to consider the game of Chinese Whispers.
The essence of my observation, here, is the G2i post-writer’s mention of an assumption made by Lord Drayson, the Science and Innovation minister. Apparently (according to the post), Lord Drayson has championed the need for such a UK INNOVATION FUND to put an end to the equity gap in the UK, based on the assumption that the fund will “…attract more investors, entrepreneurs and companies to the UK.” Is this really a key objective of the fund? What does such an assumption say about the state of innovation in the UK? Are we really so devoid of our own innovative capacity, that we must now seek to import further capacity through making available public funds for “external entrepreneurs and investors” to profit from?
All may not be as it appears… Government aims for £1 billion venture capital fund to invest in the businesses of the future
The G2i post, I assume, was based on an earlier news release (issued by the Government’s own COI); the “official” press release casts the UK INNOVATION FUND in a subtly different light. “The Prime Minister has today [29 June] announced the creation of the UK Innovation Investment Fund to invest in technology-based businesses with high growth potential. The new fund will focus on investing in growing small businesses, start-ups and spin-outs, in digital and life sciences, clean technology and advanced manufacturing.” Significantly – to my mind – no mention is made of any assumption about the fund being used draw-in non-local/UK innovators or funding.
The fund, it appears, rather than being targeted at drawing in such external support to UK Innovation, as might be read in the G2i post, is perceived to be required to invest in key sectors, where (UK) support will be given to the UK’s most promising start-ups and existing small companies.
Venture capital finance is frequently seen as the lifeblood of innovation; VC finance is crucial to realising the creative idea as an innovative product or service. Given the UK’s investment in science and technology research, further investment is required – as put by Lord Drayson – to “…safeguard the Government’s record…” in this area.
On the face of it then, if access to venture capital is one of the critical factors in developing innovative companies, products and services in the UK, then the promise of a UK Innovation Investment Fund could be seen as a welcome addition to the options faced by British Entrepreneurs. However, does it attack the real problem? Are there enough viable UK investment propositions, backed by viable UK-based management teams, for the venture capital funds already available in the UK market place?
Simply making more money available to invest will not address the fact that there has to be a supply of viable investment propositions available to invest in. An idea, stemming from some advanced research centre or other (commercial or academic), still needs the right team behind it. The so-called “equity gap” arises, in large part therefore, through the difficulty in finding the right people to manage right ideas through to fruition (i.e. production and delivery). Investment in a fund of funds: THE UK INNOVATION INVESTMENT FUND, will not address this very real concern.
And my observation? Of Chinese Whispers? Well, the G2i post was brought to my attention by Twitter: a valuable networking tool. In less than 140 characters I was treated to the headline: UK Innovation Plan – solution to the equity gap or doomed to fail? But, following the embedded link in the “tweet”, the G2i post merely offered what, on the face of it, appeared to be an inaccurate re-post of a formal press release. No attempt had been made to suggest the rationale for the head-line: the problematic of the investment gap.
Given the proliferation of (inter)networking tools, there is a danger, in any re-posting of information, that the real message becomes so obscured by noise and inaccuracy, that any potential “knowledge transfer” fails; any potential debate is stifled; and the background noise that is the constant chatter and re-chatter of diluted, and ultimately meaningless, factoids and suppositions, increases – unchecked.
I like the G2i post; it draws attention to an interesting problematic in policy-driven attempts to address the UK’s “equity gap”. I think, however, that what would be useful in an opinion piece is more opinion and less whispered repetition.
Solution to the equity gap or doomed to fail?
And my opinion? Well, the UK INNOVATION INVESTMENT FUND will neither be a failure nor a total solution: just one more option added to the complex landscape of alternative initiatives that will ensure management of the UK innovation scene will remain a commercial challenge.