Scotland’s enterprise culture – no longer desperate

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Scotland has a poor record when it comes to business start ups. Our entrepreneurial culture lags behind most other industrial countries, and compares far less favourably with the rest of the UK. But since 2011 something has begun to change. Our start-up rate has improved, pushing us closer to the average for northern Europe. According to research reported on in The Global Entrepreneurship Monitor, published in June 2013, “the country now has a higher start-up rate than the ‘Arc of Prosperity’ smaller countries of northern Europe, which had been seen as a target for Scotland to emulate.”

Amongst young people – and graduates in particular – there has been a dramatic improvement. Indeed, most of the new start-up activity can be accounted for by graduates. Significantly, 10% of new start-ups are launched by people from outside the UK – further emphasising the long-standing value of immigrant communities to enterprise in the UK.

All this is indeed positive news, but there remain problems and trends that need to be understood and dealt with urgently. For a country contemplating political independence, Scotland must make considerably more progress in entrepreneurial terms. If it fails to do so, then while its government would belong to the Scots, its economic destiny would be determined by those well outside of its borders.

Scottish start-ups: a youth movement

The role of Scotland’s graduates in accounting for most new start-up activity is encouraging. Clearly, given labour market conditions, many graduates are realising that in recessionary Britain then you make a job, not take a job. In other words, starting up in business isn’t simply an option. It may be the only option. But it’s not a particularly difficult option. In our world of Kickstarter, social media, flexible production systems, Amazon, Etsy and the like, then it has never been easier to finance, promote, produce and distribute. A recent article in the Harvard Business Review – Economies of Unscale: Why Business Has Never Been Easier for the Little Guy – makes this very case: “in a world with economies of unscale, we are empowered to take advantage of an extensive array of new, amazing services to build sustainable companies.”

The only downside in this is that, as the Global Entrepreneurship Monitor observes, once the goal of self-employment has been successfully achieved, there is often little aspiration to grow the business or employ other people. Today’s enterprise culture is more about pursuing the values of personal and professional autonomy than wealth creation and growth. It is a distinctly un-Tory approach to enterprise.

The other problem is that institutionally and politically, Scotland has not seen the development of an enterprise-friendly economy and culture as a particular priority. So, while start-ups may emerge in Scotland, to thrive they increasingly have to head south. Professor Jonathan Levie of the Hunter Centre for Entrepreneurship at the University of Strathclyde has data showing that as many as 40,000 early-stage Scottish entrepreneurs have moved to England. While Scotland’s start-up rate lags behind the rest of the UK, allowing so many of its emergent entrepreneurs to move to England, suggests a wholesale policy vacuum in Scotland’s business support infrastructure. 

This vacuum is gradually being filled as Scotland’s Universities have begun to recognise that their emphasis on employability must be complemented by a focus on enterprise. This has led to new incubators and other welcome initiatives to support the enterprise of their graduates. Universities Scotland, the umbrella organisation representing the sector, recently published a report suggesting we look west for inspiration. It highlights Massachusetts Institute of Technology (MIT), whose enterprising alumni have created 25,800 companies employing 3.3 million people and turning over $3 trillion. MIT’s success is as much about entrepreneurship as it is about world-class research, and despite ambitious words, the former remains a weakness in Scotland’s educational culture. As one recent commentary observed, the real issue is much more fundamental than knowledge transfer mechanisms: “How can Scotland’s education system be made more entrepreneurial? The issue most commonly identified is the way that schools, colleges and universities approach failure.” 

It is indeed. Most of our educational culture only recognises and encourages success. It is risk averse. 

Learn from Scotland’s makers

If Scotland really wants to accelerate entrepreneurialism then the solution is clear – look to its thriving craft economy, and learn its lessons. Scotland’s makers are doing it for themselves; they are fearlessly crafting a new economy. And most of them are doing this because they have been educated in a culture that encourages risk and does not penalise failure: the culture of Scottish art schools.

Across Scotland there are some excellent examples of enterprising design, craft and other creative practices: an entrepreneurial strength upon which Scotland’s future must be built. They may be small-scale, and emergent, they may operate on tight margins and face challenges of growth – but they are giving form to a new entrepreneurial spirit, providing inspiration to those following them, and breathing a new cultural vitality into our towns and cities. They are demonstrating that there’s more to visiting Scotland than seeing the landscape and visiting the Edinburgh Festival; there is a sparky, proud and uniquely creative culture that now infuses our once down at heel urban spaces.

Dundee is not just a microcosm of this but, I would argue, is at the heart of a new Scotland in the making.

Every year the Professional Jeweller magazine reveals their Top 100 world jewellers – these are the people changing the face of jewellery, creating its look, defining its spirit. And this year two of the Top 100 were from Dundee, both relatively recent graduates of DJCAD. Jane Gowans has developed an enviable world reputation as jeweller to the stars, providing the jewellery of choice for Emile Sande and others. Harvey Nichols provided Jane with her own pop-up shop at their flagship store, demonstrating how craft-based makers can supply successfully to retailers who operate on the world stage. She has every intention of retaining her studio and home in Tayside while she increasingly supplies to a world market.

Kate Pickering is the second Dundee based Top 100 jeweller, not that she’s best known for her jewellery. Kate has created the Vanilla Ink jewellery incubator that each year supports and mentors 10 recent graduates to establish their businesses. This is a unique enterprise that has attracted not just attention from around the world, but now has jewellers applying to work at Vanilla Ink from throughout the UK and overseas. Kate has made Dundee a highly attractive location to establish your jewellery business. The whole ethos she has encouraged is refreshingly ambitious and exploits to the full the new business support tools of our time. The Inkers couldn’t afford the £6K to hire a stand at their industry’s top Earl’s Court trade fair. But as one of Scotland’s first Kickstarter campaigns, they raised the funds in two months and succeeded in building a local support network that will help propel the next batch of Inkers into their chosen career.

Vanilla Ink isn’t just an incubator: it’s a social network in itself, digitally connected, and innovative. It is a designed business. Universities take note: if you want to establish a ground breaking incubator, forget MIT, just go visit Kate Pickering and she’ll show you how it’s done. And spend what you save on the plane fare on some stunning jewellery.

Working in the same building as Vanilla Ink is the woman who won Young Designer of the Year at the 2012 Scottish Fashion Awards. Hayley Scanlan was recently selected to be the sole UK designer to feature in Topshop’s flagship Oxford Street store. With clients who include Jessie J, Hayley has shown how Dundee is also reinventing itself as the place that the stars come for couture. Who would have predicted that, eh?

But there’s part of Hayley’s story that makes her more than an inspiration for just aspiring fashion designers. As the single mum of two young twins, she has responsibilities that the old models of entrepreneurship like Alan Sugar and Richard Branson simply didn’t have. As she told The Scotsman “You just do it,” she says, shrugging. “I want to do the best I can and no one else will do it; it has to be me. It’s hard sometimes, but I just get on with it. I’m happy, even though I’m on my own. They go to a child minder who is absolutely brilliant; I totally trust her. I do miss them sometimes, but everyone has to work.”

Cities need communities, and today more than ever they need creative communities. Such communities provide collective inspiration, they help each other’s Kickstarter campaigns, they celebrate each other’s successes. And – most critically – they help people through the failures, the set backs and the disappointments. Business start ups are not created and sustained and mentored by the market. No, it is the community that does all that. Gillian Easson should know. She and her partner and collaborator Lyall Bruce have been behind some of the key initiatives that have helped forge a real sense of a creative community in the city.

The Creative Dundee network, the Pecha Kucha nights, the mid week meets, these and other initiatives have helped give form and reality to Dundee’s creative community. From my perspective, they provide art and design students with positive reasons to stay in the city. Because Dundee is a place where you make things. Like a creative community for a new city. Gillian was a key member of the NESTA team based in Dundee. But she’s now given that up and gone freelance. She has taken a risk. That’s what folk do in Dundee.

Dundee’s entrepreneurship is different. It’s not just about making a viable business – it’s critically about making vibrant go-ahead cities that enterprising people want to live in. It is not about making money. It’s about creating autonomous meaningful work, new ways of living and supportive communities that sustain this.

Oh and something else about all the examples I’ve given.

They are all women.

Historically, Dundee was built on the social initiative and enterprise of women. It would appear that 21st century Dundee is following in this proud and unique tradition.

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