Small Talk: Britain can learn a lot from Canada in the global race to woo the entrepreneurs vital to creating jobs
If you took a drive last year out of San Francisco down Highway 101 towards Silicon Valley, you would have sped past a giant billboard emblazoned with a huge red maple leaf. Its sales pitch, “H-1B Problems? Pivot to Canada”, was an appeal to international entrepreneurs who have moved to Silicon Valley but run into problems with the US’s H-1B visa programme for high-skilled workers.
The billboard was paid for by the Canadian government, which hopes those frustrated entrepreneurs will relocate north of the border. To encourage them – and other high-skilled foreign citizens – to do so, it has been offering permanent residence to entrepreneurs who speak English or French, have completed at least one year of college, and can show they can raise funding for their business ventures.
Canada’s Start-Up Visa is not a million miles away from the UK’s Tier 1 Entrepreneur Visa programme, which sets similar requirements. But in Britain, we offer only a temporary permit to live and work in the UK, at least initially.
A report by the independent Centre for Entrepreneurs illustrates why it is foolhardy to put obstacles in the way of these people. One in seven UK companies was set up by a migrant, it reveals, and migrant-founded companies create 14 per cent of all jobs at small and medium-sized companies. In the UK’s migrant community, 17.2 per cent of people have launched their own businesses, compared to only 10.4 per cent of people born in the UK. Migrant entrepreneurs also tend to be younger.
The implication is clear. If Britain wants to foster an entrepreneurial economy, which is crucial for job creation, we should be doing everything we can to attract potential founders of new businesses to this country. Immigrants are coming here to make our jobs, not take them.
The Government is doing more than you might think in this regard. As well as the Entrepreneur Visa, different arms of government are involved in specific projects such as the Sirius Programme, run by UK Trade & Investment, which offers international graduates financial and practical support with getting a business off the ground in Britain. Successful applicants have begun working with business accelerator programmes around the country and qualify for up to £12,000 of financial assistance, plus a mentoring programme and visa endorsement. More than 1,500 graduate entrepreneurs from 93 countries enrolled in Sirius in its first year.
It may be some time before the fruits of this labour are quantifiable, but the work done by the Centre for Entrepreneurs suggests we need more of these programmes – and much less of the toxic rhetoric that surrounds the debate over immigration. Why move to Britain to start your business when you’ll have to put up with this sort of nonsense when you could just as easily move to, say, Canada and be welcomed with open arms?
Matchmaker for hi-tech research projects
Tekcapital is moving quickly. Formed just a year ago, the Oxford-based company will today announce its intention to list on the Alternative Investment Market (Aim) with a £3m fundraising that will value the company at £6m.
Tekcapital’s business model is unusual. Like several established businesses, it aims to put to use the remarkable technologies coming out of universities and research institutions around the world. But rather than developing specific projects, it has built a continually updated database that keeps track of the intellectual property being worked on at more than 3,300 of these establishments in 160 countries. Companies in need of particular tools or technologies can then pay it to access the database to find the projects they need.
Despite its youth, Tekcapital is making rapid progress and hopes the fundraising will enable it to capitalise on its first-mover advantage. It has already signed up seven clients on retainers, including one Fortune 500 company, and is in negotiations with a further 18.
Icap’s exchange can prove its worth
In the two years since the interdealer broker Icap bought Plus Markets’ Plus Stock Exchange and renamed it the Icap Securities and Derivatives Exchange, City analysts have sometimes questioned the firm’s commitment to its stated aim of working with small and medium-sized businesses keen to raise money. The ISDX branding made it sound more like a derivatives market, they pointed out.
At the end of last year, however, ISDX revamped the admissions criteria on its growth market segment, which aims to attract companies not yet ready to meet the higher regulatory standards of its main board. And now that market has picked up its first new company since the revamp – Capital for Colleagues, which wants to raise £2.19m through a listing.
Capital for Colleagues was set up to provide funding and other types of support to employee-owned businesses, a sector that is attracting support from policymakers. The business will therefore be closely watched as it works with these firms – meanwhile, its listing will also serve as an interesting first test of ISDX’s potential.
Small Business Man of the Week: Sebastian Pole, Co-founder, Pukka
“I’m a herbalist by background and when we started Pukka, I had no idea how to set up or run a company. I thought there was definitely a business in organic herbs and teas, but it wasn’t until I saw an advert in a local magazine from someone offering to work with people to develop their businesses that we got going. I was the only person to respond to the advert, which is how I met my business partner, Tim Westwell, 11 years ago.
“Pukka now sells 34 different teas and 75 food supplements and we’re launching new products all the time, including a new range of green teas this month. We’re also in our second year of a partnership with WWF UK, which we’re hoping will raise at least £50,000 through a donation of 20p from each tea sale we make.
“We’ve come a long way from the day when Tim and I literally took £2,000 each out of a cashpoint on our credit cards in order to get the business up and running. That first year, we had sales of about £27,000, compared with £15m last year.
“We started out selling to local independent health food stores and then branched out into dealing through multiples. These days you’ll still find our products in those shops, but you’ll also find us in all the big supermarket chains too, and we’re the number two brand in the fruit and herbal tea sector.”
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