1. International Enterprise Promotion Convention Harrogate 2009
“Understanding Start Ups”
Presented by Graham Hales MIBC MCMI
Principal Consultant, DeHales & Associates
Business & Management Consultants
Yorkshire & Humber Regional Chair, Institute of Business Consulting
National Finalist in Best Business Adviser Award for Newly Established Business 1998
DeHales & Associates, Business Consultants

2. Aim
“To stimulate and challenge current thinking of start up businesses and their sustainability with a view to providing a better understanding of the dynamics that influence business birth rate strategies”

3. What is a Start up Business?
Definition:
A ‘business’ which has recently
commenced trading and is in its
infancy stages of development i.e.
a kindergarten business
©. DeHales & Assoc.

4. What are the characteristics of a good start -up?
Management self belief
Business culture
Cost conscious attitude
Cash is king
Customer focused
High level of energy and activity
Vision of success

5. DeHales Business Model for Start-Ups
Stages of Development
Market Segment
Technological &
Environmental
Growth
Consolidation
Manufacturing
Trading
Trades & Services
Resourcing
Social Enterprise
Research, Testing & Planning
Value
Time
Conceptualisation
Hobbyist
Trader
Contractor
Inventor
Franchisee
Graduate
High Growth
Start Up/ Entrepreneur Types
© DeHales & Associates 2009

6. SME’s In Europe Micro-businesses are the real giants of the European
economy
Micro-enterprise = 91.5%
Small = 7.3%
Medium-sized = 1.1%
Large = 0.2%
European SMEs represent:
99.8% of all European enterprises
67.1% of private-sector jobs
more than 80% of employment in some industrial sectors such as the manufacture of metal products, construction and furniture.
Source: Eurostat,

7. Business Incubation
Business Incubation is a unique and highly flexible combination of business development processes, infrastructure and people, designed to  support entrepreneurs and nurture and grow new and small businesses, products and innovations through the early stages of development and/or change.
Source: UKBI

8. International Enterprise Promotion Convention
Global Incubation
Source: UKBI
DeHales & Associates, Business Consultants

9. UK Incubation Survival Rates
98.7% survive during Business Incubation
87% survive over 5 years
Source: UKBI

10. Trends in Business Births & Deaths
The estimated birth rate of businesses increased in 2008 from 432,300 in 2007 to 436,600 bringing the overall number of businesses to approx. 2.9 million
Barclays Business Statistics
There was an 18.0 per cent increase in business 'births' in the UK between 2006 and There were 302,000 births in 2007, a birth rate of 13.1 per cent compared with 2006 when there were 256,000 births, a birth rate of 11.6 per cent.
Deaths
There were provisionally 228,000 business 'deaths' in 2007, a death rate of 9.9 per cent. This compares with 209,000 business deaths in 2006 and a death rate of 9.5 per cent. This gives an increase in business deaths between 2006 and 2007 of 9.2 percent
Office of National Statistics
Sustainability
In 2007 the net gain in businesses i.e. birth rate less death rate was 204,300. A ‘sustainability factor’ of 47%.

11. UK Business Birth & Death Rates 2000 - 2007
Source: Office of National Statistics

12. Stages of Business Development
Enterprise/Incubation Model
‘Holistic & Continuous’
Practical Advice, Coaching & Support
Business Knowledge
Business Proposition
Investment
Customer Demand
Premises
Legislation
Commence Trading
Cash Flow
Consolidation
Growth
Stages of Business Development
© DeHales & Associates

13. Business Link Model ‘Project Based’
Business Advice and Support
Legislation
Business Knowledge
Business Proposition
Investment
Customer Demand
Premises
Commence Trading
Cash Flow
Consolidation
Growth
Stages of Business Development
© DeHales & Associates

14. Government Spending on Small Business Support
A report from Library House suggests that the government is spending £12bn a year on small business, without producing any measurable effect.
For every pound spent at least 33.5 pence is lost in the various layers of bureaucracy, the report’s authors say.
“From this review it is clear that Business Support has become a booming business sector in its own right”
“Yet its failure to provide effective support is both a waste of the taxpayers’ money and a lost opportunity to grow an entrepreneurial economy. “We must radically re-think how government supports small business, entrepreneurs and innovation.”
Source: The Richard Report 2007

15. The Changing Provision of Public Funding for Small Business Support
Treasury
Department of Business, Innovation & Skills
3 changes in 4 years
Enterprise Directorate
Previously SBS
? Future
Regional Development Agency
ERDF
Business Link
Tendered every 3 years
Enterprise & Business Support Organisations
2-3 year contracts

16. Conclusions Q. What do Start Up Businesses need? A. An matched culture
Less bureaucracy
Practical & holistic mentoring
Better access to bespoke finance solutions
‘Enterprise Financing’ at lower interest rates
Premises: Easy In – Easy Out Terms
More flexibility in planning regulations

17. Conclusions Q. What Start Up Businesses do not need? A.
More bureaucracy
Brokerage & signposting
Financing restrictions
High interest rates & match funding
Lengthy lease terms
Personal guarantees

18. Conclusions Q. What does Government need to do? A.
Satisfy the needs of Start Up businesses and stop treating like established businesses
Stop using short term strategies for supporting enterprise and innovation
Focus support on business creation AND sustainability.
Focus on the quality and sustainability of business support

19. Where Now? "Small Business Act" for Europe
Adopted in June 2008, the SBA aims to improve the overall approach to entrepreneurship, to irreversibly anchor the "Think Small first" principle in policy making from regulation to public service, and to promote SMEs' growth by helping them tackle the remaining problems which hamper their development.
The Small Business Act for Europe applies to all companies which are independent and have fewer than 250 employees: 99% of all European businesses.
Source: European Commission

20. What will it mean to Start-Ups
The time needed to start a new company should be no more than one week.
One-stop-shops should be provided to facilitate start-ups and recruitment procedures.
A new statute for a European Private Company will allow SMEs to start up and operate according to the same company law provisions throughout Europe.
All EU measures to support SMEs are designed with craft and small enterprises in mind.
Source: European Commission