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The UK’s punishing business regime is at risk of taking its entrepreneurs for granted. They won’t keep trying forever, writes Orlando Martins
I meet a lot of entrepreneurs, both as a headhunter and as founder of Growth Index, which profiles the fastest growing 100 companies in the country by compound annual revenue growth over two years.
Their collective ingenuity never ceases to blow me away: this year, for example, we have companies pioneering new drug discovery platforms, designing new battery systems, rethinking the humble coffee shop, transforming business banking and solving the problem of identity verification online.
These businesses are doing amazing things, creating something new and different, and in so doing renewing and growing the economy to everyone’s benefit. It takes tremendous drive, ambition and resilience on the part of founders and ‘growth CEOs’ to reach this point.
Contrary to myth, however, this resilience is not unlimited, and government should not take for granted that the nation’s entrepreneurs will keep trying, keep accepting difficult conditions and keep quiet about it.
It can be extremely hard emotionally not just to put in the hours that founders do, but often to put your own or your family’s financial security on the line in the process. Mental and physical health crises, suicide, family breakdown and bankruptcy are all potential unintended outcomes for those who take the chance.
Government isn’t responsible for the success or failure of a new business, but its decisions directly affect both the burden on entrepreneurs and their risk-return calculus. Like many other long-term founders, I’m particularly thinking of the National Insurance hike and the effect of changes on inheritance tax.
Inspiring vs deterring the next generation
Entrepreneurship is often multi-generational, even if the business isn’t, maybe because young people have witnessed the trials and tribulations of the previous generation, and saw that it was possible to come through the other side.
I think of my dad. He didn’t dream of being an entrepreneur. He was made redundant from a director level position in a bank, and didn’t have a plan B, so he made one, creating a boutique hotel out of our family home at a time when his mortgage interest rate was running at 19 per cent.
It wasn’t easy for him, or for my mother, who was forced to go on the entrepreneurial journey with him. I saw that spirit of needs-must that many founders – and all parents – have. They didn’t make a million but they did keep us together and made me believe that if they could do it, so could I.
But inspiration only goes so far. There need to be incentives to build a business that lasts, otherwise people will turn away from the idea of entrepreneurship altogether, and our Mittestand will be decimated.
Get it right though, and we could invigorate our start-up and scale-up scene. Historically many of our brightest stars moved to the USA for bigger, better opportunities. In the age of Trump, this founder and talent drain could be reversed, with the UK attracting and retaining more and more great people, but only if we support our growth creators in the way they deserve.
One of the reasons I founded Growth Index was to provide a space for founders and CEOs to support each other through networks and sharing independent thinking, but there needs to be policy support too.
Looking at the top high-growth companies this country has to offer, I’m highly optimistic that the appetite, the talent and the drive are all there if we stop bashing them and let them get on with what they do best.
Orlando Martins is a board advisor, organisational strategist and headhunter. He founded ORESA Executive Search (B-corp) in 2008 and GrowthIndex.com, which ranks and celebrates the fastest-growing UK companies in 2022.
