ENTREPRENEURSHIP - Factors for success

June 11, 2013 12:13 am

Throw away the suit and know execution matters

By Doug Monro

I have five top tips for people thinking of starting their own business.

First, don’t do it! If you do, you’ll be letting yourself in for an immense amount of unrewarded hard graft, a series of failures and the need to keep bouncing back a thousand times when things don’t work.

Next, people matter. Surround yourself with really great people who believe in what you are doing and whom you trust and enjoy working with. Treat them well – and that includes investors.Burning yourself out without knowing if it will ever pay off is certainly not for everyone. If you ignore me and do it anyway, then give it your all. If you start a business halfheartedly, you will not succeed.

Second, it is important to understand your own risk profile. When is the right time for you to a start a company? What financial and personal risk can you afford to take? Do you really know your market? In my case I had corporate experience, an MBA and start-up experience before becoming a founder, so I learnt on someone else’s dime.

Fourth, don’t forget that execution matters. Even if you have five competitors doing the same thing, you can still win if you execute better than them. Luck has nothing to do with it. Spend less time at conferences and coffee mornings, and put more into building and selling a great product. Test, learn, get feedback and iterate fast.

Finally, never wear a suit if you can help it. People who are more concerned about dress code than substance are not worth working with anyway.

Once these rules are established, you will find the UK is broadly entrepreneur friendly.

We have a decent education system, good infrastructure and a flexible labour market. Culturally, we are not as risk hungry as the US, but that is changing.

We now have celebrity entrepreneurs as role models, and even television shows promoting start-up businesses, for all their flaws. We have tax breaks for company founders, such as Entrepreneurs’ Relief, as well as for investors, such as the Enterprise Initiative Scheme.

In the consumer internet sector where Adzuna operates, the UK does not have the history and concentration of start-ups that have developed in Silicon Valley over the past 30 years. But we do have other advantages, including a diverse culture and workforce, and access to London’s media and financial services expertise. For global businesses, London is still the best place to be headquartered.

There is, however, always more the government can do, particularly to reduce the administrative burden on start-ups and their employees. The requirements of Companies House and HMRC remain labyrinthine even to an experienced business manager and qualified accountant like me. What is needed is not rocket science: get everything online, put it in layman’s terms, ask for things only once and only those that are needed, and simplify them.

On taxation, payroll tax breaks to get young businesses going or incentives for employees to profit from stock or options in companies they help create are always welcome.

It is time to tax global corporations properly and challenge their transfer pricing schemes. We need to create a level playing field for all businesses operating in the UK, irrespective of where they are based.

The government should also sort out the banking system to create real competition and customer service, train more computer scientists to fill the talent gap and make the London markets more attractive for technology initial public offerings, to stop us selling so many great British businesses to big US corporations who do not pay UK taxes anyway.