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The Challenges Faced by SMEs as They Grow

Introductory Presentation given to Inaugural Meeting of the Harwell Oxford Technology Entrepreneurs Forum (TEF) on 12th June 2012
(given in my role as an Ambassador for the TEF)

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The Challenges Faced by SMEs as They Grow

  1. 1. Inaugural Meeting for Harwell OxfordTechnology Entrepreneur Forum (TEF)The challenges faced bySMEs as they growDr Martin Dare-EdwardsUK Country Manager, Infineum12th June 2012
  2. 2. The challenges faced by SMEs as they growThe Drive for Growth• Oxfordshire LEP’s Mission “to increase the number of high-value- adding sustainable jobs in Oxfordshire” • Incentives for companies starting-up and growing in Oxfordshire Science Vale Enterprise Zone (Harwell Oxford and Milton Park)• GrowthAccelerator - helping ambitious business achieve rapid and sustainable Growth• StartUp Britain (includes provision of guidance for Growth)• Primary source of those new jobs will come from i. Foreign Direct Investment (e.g. Element 6) ii. Growth of existing SMEs (especially in the £1-100M turnover range) (i.e. substantially more jobs to be created than from new Start-ups)
  3. 3. The challenges faced by SMEs as they grow• Funding • Huge decline in Bank Lending; that offered is on stringent terms (Despite £76billion Merlin agreement); VC Investment also depressed • Many Financing Initiatives (needs guidance from experience) • Enterprise Finance Guarantee (£600M), and Exporters EFG • Enterprise Capital Fund • Community Development Finance Institutions (disadvantaged communities) • Capital for Enterprise (BIS sponsored arms length Fund of Funds investor) overseeing the management of Venture Capital and Loan Funds • Business Angel Co-investment Fund • UK Innovation Investment Fund • Business Growth Fund (£2.5billion “long term capital” and active partner invested into fast growing medium sized companies… delivered locally) • Business Angel Investment • Strong Oxfordshire activity particularly facilitated by Oxford Innovation (OION, OEI, TVIN) 3
  4. 4. The challenges faced by SMEs as they grow• Skills Gaps • Much degree-level scientific expertise exists in Oxfordshire, but recruitment largely brings in resource from rest of UK, + Europe • Shortage of engineering-technical skills at NVQ 3-4; Major drive to promote technical Apprenticeships, and initiating higher technical apprenticeship (NVQ 4/5). Note option of sharing an apprentice using a business park as host • Note new NVQ courses focusing on Entrepreneurship (OCVC – Peter Jones Enterprise Academy NVQ 2&3), and Apprentice Schemes targeted to provide support to SMEs (Enterprising Skills in a Business Environment NVQ3 and Innovation & Growth NVQ4) • Leadership, Business Planning and Innovation support Note Mentoring support for High Growth Potential businesses from “GrowthAccelerator” (need to have aspiration and basis to double turnover in 3 years) • Marketing and Sales Skills (including market assessment & analysis) • Human Resource Management (including recruitment & development) 4
  5. 5. The challenges faced by SMEs as they grow• IP protection • (Suitably protected) Technology and/or design provide scope for differentiation to close out competition and generate higher margin • Copious experienced IP lawyer resource in Oxfordshire • Oxfordshire has a high density of patents, but poor commercialisation rate – but note “Marblar” launch (backed by the IP Group) providing crowdsourcing approach to exploit dormant IP• Export • Particular encouragement by government for export • Challenging to initiate but much support from UKTI, including financial • Key benefit also to access higher growth markets (i.e. outside Europe) 5
  6. 6. Mutual Support to Overcome Challenges forSME GrowthHarwell Oxford Technology Entrepreneur Forum• Mission • …to become a think tank for the commercialisation of innovation and growth within the High Tech sector. • …to become a community where leaders of High Tech SMEs can meet to share knowledge & best practice, collaborate, inspire and provide mutual support in order to achieve growth and success.• Aims • … to encourage business collaboration between members • … to bring opportunities from outside the forum, likely to be of interest to membership, with the specific objective of helping member companies to become established and grow. 6