Two of the UK’s leading entrepreneurs were in Sheffield at the launch of the results of the Entrepreneur Survey 2011 of the Yorkshire & Humber Region.
Julie Meyer, CEO at Ariadne Capital and BBC online dragon was the co-founder of First Tuesday which was sold for $50 million. Lara Morgan started her own toiletries company, Pacific Direct, with £350 and sold it for £20 million.
They spoke at the launch of the findings of the survey of 100 entrepreneurs in the Yorkshire and Humber Region which shows that three quarters have either hit or exceeded their projected revenue growth targets in the last 12 months and are expecting more than 10 per cent growth in the coming year. Almost a quarter of businesses surveyed are even projecting growth of greater than 50 per cent.
The survey was carried out during July and August by independent firm of chartered accountants Barber Harrison & Platt (BHP) and law firm Nabarro, in association with YABA (Yorkshire Association of Business Angels). Assessing companies, most of which were less than five years old in a range of sectors and across the region, the survey focused on owner-managed businesses with an annual turnover between £250,000 and £5 million.
Lara Morgan advised entrepreneurs against selling equity in their companies: “I’d sell my grandmother before I sold equity,” she said. “People are in far too much of a hurry to give away equity early on in their businesses when, with a bit of patience and imagination, and perhaps some bravery in borrowing, that’s a better way of doing it without selling your grandmother.”
Julie Meyer enthused that – despite the economic climate – this can be a good time to set up a company and she advised that start-ups can benefit from working with much larger businesses which can help incubate and develop young companies.
Andrea Cropley, Corporate Partner and Head of Regional Strategy at Nabarro, says: “The survey demonstrates that the Yorkshire and Humber Region is home to many self-motivated owner managers who have continued to grow organically and who are generally optimistic about their futures.
“However, the region faces some serious challenges if entrepreneurial effort is to be the bedrock of its economic future. The survey suggests that growth is incremental and that there remains a domestic focus to future ambitions.
“The survey also reveals few young entrepreneurs. Of the 100 company owners surveyed, 65 per cent were aged 35-54 and only one was under 25 years old.
“We don’t believe that there is a shortage of ideas, but evidence suggests that hard to access, expensive funding is stifling the drive and ambition of the younger generation.”
Lisa Leighton, head of Entrepreneurial Advisory Services at BHP, said: “Along with the good news about the growth of many of the region’s young companies this survey reveals the need for a much greater understanding of – and access to – sources of finance in order to fund growth.
“The survey clearly illustrates the fact that a small proportion of entrepreneurs obtain funding from what should be obvious routes. Only 16 per cent have received investment from external investors – and that includes family and friends.”