UK versus USA: the battle of the young entrepreneurs

The government wants to make the UK the best place in the world to start and grow a business. If this is to happen, students and graduates are going to play a big part. As Brown looks across the pond to the ‘enterprise culture’ of the USA, where Larry Page created Google almost from his dorm room, and Facebook, the brainchild of Harvard graduate Mark Zuckerberg, has just been valued at £15bn, he must be wondering if the UK will start to see similar graduate success stories from our own universities.
The signs are looking good. According to the National Council for Graduate Entrepreneurship (NCGE), 11% of students are currently engaged in ‘enterprise and entrepreneurship related activities’, a steady increase from ten years ago. But this is still compared to 50% of US students. So what’s causing the difference?
Entrepreneurialism in the UK is getting more publicity than ever before. TV programmes The Apprentice and Dragons’ Den have both made a huge impact in the way in which is entrepreneurialism is regarded by the public. Traditionally, becoming an entrepreneur was seen as a respectable career in the US, but it did not have the same status in the UK. Strange as it may seem, Alan Sugar and Peter Jones have arguably done more to change this than the PM’s initiatives ever could.
And budding entrepreneurs are now able to access a plethora of information about starting and funding a business venture. Websites such as www.businessweek.co.uk, www.growingbusiness.com, www.enterpriseweek.co.uk, www.startups.co.uk and www.berr.gov.uk offer help for young hopefuls who need advice about anything from funding to legal issues.
Anne Haswell, International Business student at Northumbria University, believes that her generation has seen an increase in support for enterprise-minded students:
“There is so much advice and help out there now, that the opportunities are boundless for young entrepreneurs. Unfortunately that does mean that competition is now higher than ever before and it has become increasingly difficult to come up with something ‘original’ – but that’s just the nature of the beast!”
Government initiatives and high-profile entrepreneurs are also concentrating on spreading the entrepreneurial word among the young. For example serial entrepreneur Oli Barrett launched the Make Your Mark with a Tenner Challenge, an initiative in which 10,000 students were given £10 and just one month to generate as much profit and social impact as they could. Says Matt Thomas, editor of Startups: “Credit must go to the government's Enterprise Insight projects such as Make Your Mark, What If!, and the Social Enterprise Coalition for channelling enterprise funding and support to young people of diverse backgrounds.”
And institutions such as banks are also getting involved in the new wave of entrepreneurialism: in 2008 we will see the results of the HSBC Unipreneurs Awards – which aim to discover and encourage a new generation of university educated entrepreneurs.
The number and profile of young entrepreneurs is consequently rising. Fraser Doherty, for example, is only 18 and is currently managing director of Eat Super Ltd, which produces a range of no added sugar ‘super fruit’ spreads - SuperJams. He was hailed the 2007 Young Entrepreneur of the Year in the NatWest Startups Awards and his product is gracing the shelves in leading supermarkets. “He’s evidence of entrepreneurial potential now being fulfilled at an early age and not lost inside large organisations that seldom recognise the value of young talented people,” says Thomas.
Similarly, Growing Business Magazine’s Young Guns Awards unveiled a profusion of talented entrepreneurs under 30 including Tom Allason who, along with university friend Jay Bregman, founded online courier service eCourier in 2002.
Alex Tew’s business idea was even inspired by the prospect of going to university – daunted by the idea of student debt, he decided to try and make $1m, and came up with the Million Dollar Homepage, selling pixels to advertisers. The idea was so successful that his university career became an unfortunate victim to his entrepreneurial ventures.
And Ben Way, 27, is the founder of The Rainmakers, Brightstation Ventures, ViaPost and The Horsesmouth, and was on the Sunday Times Rich List at the age of just 19.
Another development making entrepreneurship accessible to young people is of course technology. The new Web 2.0 generation has opened the door to a ‘Global Village’ which neither America nor Britain can monopolise. The internet, says Matt Thomas, ‘has shattered the barriers to entry that previously held people back; enabling budding entrepreneurs of any age to instinctively act on and commercialise their ideas’.
Fantastically successful Web 2.0 enterprises such as Last.fm and Where Are You Now? (WAYN), both set up by young entrepreneurs, are testament to this.
As a result, though the UK lags behind the US in terms of entrepreneurial activity, there’s a palpable sense of things changing. With increasing support from the government, more inspiration, high-profile role models, and advances in technology, entrepreneurs of any age are looking at greater chances of success.
There’s something missing in this mix though, and it’s this that the NCGE identified: The role of universities. Fewer than 50% of universities have ‘enterprise characteristics’, according to the NCGE, something it says has to change. Though the enterprise culture may be in existence in schools, on TV and through a plethora of government-sponsored initiatives and events, it still is not there in the echelons of higher education.
Says Ian Robertson, NCGE chief executive:
“We would like to see all universities displaying entrepreneurial characteristics and all students exposed to innovative enterprise and entrepreneurship learning opportunities. Current levels of engagement and provision are unacceptable and damaging to our economic and social prospects.
“The government has spent a lot of money on this over the past ten years, but universities are still not enterprise-friendly, by and large.”
Says Matt Thomas: "More of UK's young people are rightly considering starting a business as a viable career option when leaving school, college or university - or alternatively as a way of funding their studies.” This is encouraging, but the fact that 50% of students in America are involved in entrepreneurial activity still seems staggering to us. Perhaps if the enterprise culture manages to infiltrate its way into higher education, in the way it’s taught and promoted, it won’t seem so for much longer. And it will be the students and the graduates who make the UK the best place in the world to set up a business.