Howard Bell is a Venture Partner at Octopus Ventures, with a focus on business and product strategy. He has mentored more than 20 companies, repeatedly launched and built distinctive, scalable business models and has led business development and marketing teams throughout his career.
The UK entrepreneur community is thriving. Talent, ambition, inspiration and sticking-power is coming through more than ever. Investors are more patient, more holistic and less risk-averse. They’re better at supporting their capital and the founders who attracted it in the first place.
But where are the truly world-beating UK companies? By ‘world-beating’ I mean the ones the person on the street will have heard of. Not just in London and L.A., but in Manila, Buenos Aires and Anchorage too.
Ask these people for a famous British company and their answer will probably still be ‘Rolls Royce’. Not Arm Holdings, not SkyScanner, not Zoopla. These and many others have been great British successes in recent years. But still, Rolls Royce is the archetypal — and somewhat mythical — British world-beating brand name.
Isn’t it time for an update?
The many positives
We’re doing a lot of things well in the UK. Tech transfer out of our universities (which are undoubtedly world-leading in themselves) is gaining traction. The National Graphene Institute at Manchester University is a good example and Octopus Venture’s Luke Hakes sits on the board, plugging it straight into the commercial pipeline.
Entrepreneur First demonstrates and feeds the fertility of the UK entrepreneurial ecosystem, drawing talent from the likes of Google, Goldman Sachs and Stanford.
The barriers to entry are lower. It’s technically easier to set up and run a small business than ever before, and the UK is holding its own despite Brexit. There’s more talent, more capital and more investment happening here than ever before.
The risk-averse, sceptical culture of investment of past decades is well and truly dead. Companies like Farfetch, Deliveroo and Worldremit are making significant inroads into foreign markets, even the impenetrable giant, China. And, happily, there are still plenty of problems to be solved, which are the lifeblood of innovation.
Now for the caveats
Europe’s biggest tech companies are Scandinavian (led by Spotify), German and now Dutch with Adyen. The UK has its share, but do ASOS, Deliveroo and Boohoo carry the brand recognition and operational clout to be named ‘world-beating’?
These and others, like Funding Circle, are great businesses, make no mistake. But we’re looking here for the names that could measure up to, rather than snap at the heels, or be swallowed up by, the tech giants: FAAMG (Facebook, Apple, Amazon, Microsoft and Google). And let’s not forget the Eastern titans: Alibaba and TenCent among them.
PayPal and eBay disrupted banking and retail, but times have changed. Back then, I was part of the team that took PayPal in the UK from a handful of users and no licence, to 20 million users, FCA approval and £200 million revenue in five years.
Today, there are still problems to solve, but the giants’ shadows fall far further and heavier. Disruption is no longer the buzzword it was.
Scope for greater ambition
This is not to say the outlook is gloomy. It’s simply to point out the scope for greater ambition. We’ve managed to avoid the word ‘unicorn’ until now, but the unvarnished truth is that our British unicorns achieve glittering exits rather than established global fame in their own right.
This in itself is not a bad thing. These days, foreign ownership (of the likes of Skyscanner, Swiftkey and Magic Pony) doesn’t steal away talent and resource from our shores. In fact, it retains and grows teams here, drawing in further investment.
But let’s ask the question. When will there be a home-grown company that competes all over the world, in its own right? This is what ‘world-beating’ means.
Things are good, but let’s set our sights much, much higher.