Weconnect 24 nov 2015

Preparing our children for the future: Are we doing enough as educators, entrepreneurs and parents - to help students think about the jobs that will be when they complete their formal education?

WEConnect

Sherry Coutu CBE#scaleup#founders4school

24 November, 2015

Document typeDateCONFIDENTIAL AND PROPRIETARYAny use of this material without specific permission of McKinsey & Company is strictly prohibited

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE1

2And this is Jean Laponce. My professor at university.

3And this is my mom. Her last job was as a civil servant n office manager at the Prince George airport. She went back to work when I was 7 as a receptionist at the local doctors office.

4Father

5First person I met who had gone to university. He was passionate about what he did and he convinced me that I was bright enough to go to university.

6Jean Laponce

7Steve Shirley: She was the first role model I had: She has an amazing story and it inspired me to do a few other things

ENTREPRENEURSHIP2000Floated second Start-up1986 Came to the UK to attend the London School of Economics1987Became a Computer Programmer1991Studied Business at Harvard1994Joined my first start-up1995Founded second Start-upSherry Coutu CBE < 20001997first startup sold#scaleup

THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE

#scaleup

9

We are doing very well on Start-ups...

The Scale-Up Institute #scaleupSherry Coutu CBE

But we are doing less well at growing them (!)

The Scale-Up Institute#scaleupSherry Coutu CBE

THERE IS A SCALE-UP GAPMany European economies, including UK are as effective as US in creating new businesses

Not enough of them grow displacing older firms

This lack of scale up means the economy as a whole loses on productivity and growth.Nesta (2011). A Look at Business Growth and Contraction in Europe THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE

#scaleuphttp://www.scaleupreport.com

Nesta (2011). A Look at Business Growth and Contraction in Europe 12

Very Few Start-ups Survive and GrowUK businesses that started in 1998 10 years later and beyond

221,731

83,165

8,649

5,934All businesses that started with at least 1 employeeBusinesses that survived in 2008Survivors with 10+ employees in 2008Survivors that achieved at least 1 year of high growth

100%37.5%3.9%2.7%The Scale-Up Institute#scaleupSherry Coutu CBE

13

Research by the academic David Storey has found that the

median annual sales of a six-year-old firm in the UK are less than 23,000

avg < 23,000 #scaleup

|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE1436 Storey, D. (2008). EvaluatingSME Policies and Programmes:Technical and Political Dimensions.The Oxford Handbook ofEntrepreneurship. Retrieved from:http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780199546992.001.0001/oxfordhb-9780199546992-e-10

See more at: http://www.nesta.org.uk/blog/missing-100-billion#sthash.RVZfCQp9.dpuf

Research by the academic David Storey found that

Just one per cent have sales of more than 1 million six years after they star1 % > 1m#scaleup

|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE1536 Storey, D. (2008). EvaluatingSME Policies and Programmes:Technical and Political Dimensions.The Oxford Handbook ofEntrepreneurship. Retrieved from:http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780199546992.001.0001/oxfordhb-9780199546992-e-10

See more at: http://www.nesta.org.uk/blog/missing-100-billion#sthash.RVZfCQp9.dpuf

SCALEUPS DO CONTRIBUTE TO PRODUCTIVITY

BIS data show that in the UK average turnover per employee is:

170,000 for firms with 250 plus employees

164,000 for firms with 50 to 249 employees

134,000 for firms with between 10 and 49 employees39

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE1636 Storey, D. (2008). EvaluatingSME Policies and Programmes:Technical and Political Dimensions.The Oxford Handbook ofEntrepreneurship. Retrieved from:http://www.oxfordhandbooks.com/view/10.1093/oxfordhb/9780199546992.001.0001/oxfordhb-9780199546992-e-10

6% 54 %JOB CREATION IS LINKED TO COMPANIES THAT ARE HIGH GROWTH (2009)#scaleup

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE17OECD (2014) Young SMEs, growth and job creation. Retrieved from http://www.oecd.org/sti/young-SME-growth-and-job-creation.pdf Stangler, D. (March 2010), High Growth Firms and the Future of the American Economy. Retrieved from http://www.kauffman.org/~/media/kauffman_org/research%20reports%20and%20covers/2010/04/highgrowthfirmsstudy.pdf Recent reports from the US, EU and other leading economies have demonstrated that in aggregate young companies have been responsible for 100 per cent of net new job creation. The OEC D has conducted a detailed study across 18 countriesanalysing the link between the dynamic of business growth (as measured byemployment) and economic growth. This found that companies which have beenin existence more than five years, in aggregate, reduced employment every yearbetween 2001 and 2011; whereas, companies which were less than five years oldwere, in aggregate, net job creators in each of these years.24 24 OECD (2014), The Dynamicsof Employment Growth: New Evidencefrom 18 Countries. Retrievedfrom: http://www.oecd-ilibrary.org/docserver/download/5jz417hj6hg6.pdf?expires=1408440163&id=id&accname=guest&checksum=67DB-405D7A298298BF7C62BD-82982CCE

40%

A summary of these two slides:...what this means is that:the workplace is changing and we need to prepare our children with a compatible skillset. The way we educate our children needs to adapt to meet it.the three Rs are still importantthe growth of technology industries adds focus to STEMa shift to lots of small businesses requires more creative and entrepreneurial skills

to nurture and raise a single child into a successful human being takes much longer and is a more complex and arduous process for society than to introduce an additional child into the world

http://www.scaleupreport.com

21Isenberg, D. (2012). FocusEntrepreneurship Policy on Scale-Up, Not Start-Up. Harvard BusinessReview. Retrieved from http://blogs.hbr.org/2012/11/focus-entrepreneurship-policy/

http://www.scaleupreport.com How do I help you become one of the next unicorns ?

|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE

6 main gaps to focus on

THE SCALE-UP INITIATIVE Sherry Coutu CBE

#scaleupThe Evidence Gap: public and private sector organisations identify, target and evaluate their support to scale-up companies.The Skills Gap: improve the ecosystem so scale-ups can find employees with the skills they needThe Leadership Capacity gap: building their leadership capabilityThe Sales Gap: accessing customers in other markets / home marketThe Finance Gap: accessing the right combination of financeThe Infrastructure Gap: navigating infrastructure

|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE23Additional GVA


#scaleupThe Evidence Gap: public and private sector organisations identify, target and evaluate their support to scale-up companies.

|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE24Additional GVA

Are You in favour of the Government INTERNALLY sharing (with other government departments or agencies) the fact that your company is one the fastest growing companies in any sector?


97% of Scaleups CEOS Are in favour of the Government INTERNALLY sharing (with other government departments or agencies) the fact that your company is one the fastest growing companies in any sector?

97%OF 163 SCALE-UPS97% WERE IN FAVOUR


8,923THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE

#scaleup

27

SCALE-UPS ARE THROUGHOUT THE COUNTRY

Find them all here! http://www.scaleupbritain.com Scale-ups are found in each of the 39 LEP areas

6,659 (75 per cent) are located outside London.

On average a LEP will have approximately 228 scale-ups in their area.

#scaleup

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE

Lucinda Bruce Gardyne from Genius FoodsInspired by her childs allergy to gluten and her passion for chemistry, Lucinda set about creating a loaf so her eight year old son Robin, who had a wheat allergy, could dip bread soldiers in his boiled eggs at breakfast.

Founders4Schools

https://www.everywoman.com/article/julie-deane-cambridge-satchel-company-shares-her-story-success

Claire Hooper from Duofertility:Inspired by how far the founders had taken it, Claire recently left her portfolio career which she had pursued post selling her first company to solve the fertility problem we career oriented women face

Founders4Schools


Brynne HerbertMove GuidesFounders4Schools


Jenny GriffithsSnapfashionFounders4Schools



#scaleupThe Skills Gap: improve the ecosystem so scale-ups can find employees with the skills they need

33Additional GVA

I would be able to grow my company faster if university graduates had the skills needed to meet my customer demand

82%OF 163 SCALE-UPS AGREE

ATTRACTING TALENT, SKILLS AND BUILDING LEADERSHIP


Todays students will be working for and creating tomorrows companies.

The Vital 6%: How High-Growth innovative businesses generate prosperity & Jobs report by NESTA Oct 2009The Digital Manifesto: How Companies and Countries Can win in the Digital Economy, BCG Jan 2012


Closing The Scale-Up Gap: Human Capital Schools & Universities

Entrepreneurship in curriculum?Entrepreneurs on board of Governors?Local Scale-up leaders in the class-room as role-models?Proportion of Local Scale-up companies featured in careers fairs?Proportion of work experience features local scale-up companies?Extra-curricular student entrepreneurship activities / clubs?Proportion of students visiting scale-ups on open days?#scaleup

54% of students wish to study STEM

(vs 18% national avg)

87% of students wish to get involved with a project or business

(vs 60% national average)After one, one-hour session

As role models, the entrepreneurs are inspiring a generation of young people to believe in themselves and believe that they too can make a difference.

Tricia Kelleher, Principal, Stephen Perse FoundationFounders4Schools

Speaking to students afterwards they were struck by how well [the founders] spoke but also how much they had achieved

they made entrepreneurialism and a job in High Tech industries seem achievable for all in the room, made students think about career routes that they hadn't previously thought about. They made a really effective connection.

Lisa Thefaut, Enterprise Co-ordinator, Ursuline High School, Wimbledon

Founders4Schools


#scaleupThe Leadership Capacity gap: building their leadership capabilityThe Sales Gap: accessing customers in other markets / home marketThe Finance Gap: accessing the right combination of finance


TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE43Additional GVA

81%OF 163 SCALE-UPS AGREE

The Scale-Up Institute#scaleupSherry Coutu CBEPROCUREMENT

I would be able to grow my company faster if it were easier to attract larger corporates as customers in the UK.Attracting overseas customers more important than overseas investment.


Closing The Scale-Up Gap:Local Government

Celebrate scale-up growth events in your city with the media Invite scale-up leaders to share their experience with studentsCelebrate new customer wins and help create new onesEncourage local universities to offer courses to scale-up leadersMeet with a selection of scale-up leaders every month (3 hours)Persuade real-estate leaders to offer scale-up friendly terms

#scaleup



Closing The Scale-Up Gap: Media

Shine a light on our most successful scale-up leaders and their companies rather than only start-ups.

Profile successful scale-up entrepreneurs at key mile-stones to inspire others (especially the next generation)

Review and hold to account initiatives and policies in entrepreneurship:

Are they about starting or growing businesses? Are they actually providing evidence to support their claims? What is the cost per job created? Are they collaborative?

#scaleup



Closing The Scale-Up Gap:Lawyers, Accountants, Bankers:

Identify mentors with experience and find effective ways to share their knowledge

Publish the the amount you procure from scale-ups

Offer infrastructure / co-working spaces:

#scaleup



Closing The Scale-Up Gap:Large Corporates

Short Term:

Publish the the amount you procure from scale-ups

Long-term:

Support existing initiatives that help teachers and schools develop future business skills in our students

#scaleup



TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBEScaleup TRACKINGhttp://www.scaleupreport.com


Choose a big enough problem

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE51to give yourself room to grow

Embed yourself in the right Network

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE52To benefit from advice and connections of people who will understand the challenges you will face

Recruit People who have done it before

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE53Because many of the problems encountered while scaling are common across organisations

Hire for tomorrow, not for today

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE54Because in a high growth organisation your needs will change extremely rapidly

Embrace Diversity

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE55To broaden the number of problem-solving approaches within your team

Nurture Company Values

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE56As you grow in order to avoid losing a sense of mission and identity

Build systems that scale

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE57From technical infrastructure and data systems to organisational processes

Test product / market fit

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE58Test continuously to stay close to the customer new techniques are needed when you can no longer meet all of your customers individually

Take the right kind of money.. at the right time

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE59And avoid making fundraising an end in itself

Take the right kind of money.. at the right time

TRACKERUnit of measure1 FootnoteSOURCE: SourceTitleUnit of measure|THE SCALE-UP REPORT ON UK ECONOMIC GROWTH Sherry Coutu CBE60And avoid making fundraising an end in itself

Let us start today:We can Reverse The Scale-up Gap20142020

2034#scaleup


61

Intervention potential 1% into HGFs

Employment bandTotal business population 1% of businesses into HGF modeAggregated additional employment impactAggregated additional turnover impact bn

10-49186,7451,86752,2767.1

50-24930,68530743,2877.1

250+6,59566142,56024.5

Total224,0252,240238,12338.72

Weconnect 24 nov 2015

Small Business & Entrepreneurship

Transcript of Weconnect 24 nov 2015