Channelling Pittsburgh

Silicon Valley grandee, tech venture capitalist and Y-Combinator accelerator founder Paul Graham recently posted this piece about how Pittsburgh, Pennsylvania could become a startup hub.

Here's his summary of what he said the 300k population city could do:-

• Encourage local restaurants
• Save old buildings
• Become bicycle-friendly
• Take advantage of density
• Make CMU [the local university] the best
• Promote tolerance

These objectives sound pretty familar to anyone living in Leicester, don't you think?

He including a particularly interesting section about what universities should or shouldn't do to encourage enterprise:-

"Shouldn't universities be setting up programs with words like 'innovation' and 'entrepreneurship' in their names? No, they should not. These kind of things almost always turn out to be disappointments. They're pursuing the wrong targets. The way to get innovation is not to aim for innovation but to aim for something more specific, like better batteries or better 3D printing. And the way to learn about entrepreneurship is to do it, which you can't in school."

Hear, hear!

Paul Atkinson - RIP

I recently learnt of the untimely death of Paul Atkinson of Leicester-based Atkinson Design Associates.

You can read a full obituary in Design Week but it's astonishing that Apple's chief designer Sir Jonthan Ive's college design teacher is almost completely unknown in Leicester.

I'd barely got to know Paul when he passed away. He was so full of first-rate ideas for art galleries and design festivals, not to mention his own design output. He was the driving force behind the seminal Design Leicestershire book.

He did so much to celebrate our local design talent - shouldn't we do something to celebrate him?

The Best Kind of Business Events

Business owners often feel like they should be networking more but what sort of events work best and who should be running them?

I’ve tried to answer this question by outlining and critiquing four common event formats….

1. Generic Business Exhibitions

These sorts of events are most often run by public sector organisations or chambers of commerce who wish to be seen to ‘support business’ as a box-ticking exercise. Typically, they will be open to any sort of business exhibitor to rent a stand.

Events like these strongly self-select generic business services companies as exhibitors – companies such as lawyers, accountants and marketing agencies who can sell to the widest section of visitors. They are pretty much useless to companies selling to new or niche markets.

These events can make for a nice fun day away from the office but are rarely productive for either exhibitors or visitors. The exceptional few exhibitors who do make it work usually have a product so desirable that there are far better, more scalable means of promoting their services.

By about 2pm these are typified by a large number of tired people in suits aching to sit down. The only real winners are the event venues, roll-up banner printers and suit dry cleaners.

2. Industry-Specific Exhibitions

A.k.a. “plumbers’ conventions” – these events pack large numbers of similar businesses into a single hall and trade on exhibitors’ fear of missing out.

These exist in all industries and are the sorts of things you will see at Earls Court, ExCel or the NEC.

These events can be good for visitors who have a particular purchase in mind but they are very much dog-eat-dog for the exhibitors. They tend to attract 'tyre-kickers' rather than ideal customers who will love exhibitors' products.

Exhibit if you’re launching a new product and want to get feedback or talk to the press but be prepared to come away with no leads at all. They can work well as a focal point for meeting existing or prospective clients by prior arrangement: "I'll be at Exhibition X - come and say hi".

3. Presentation Lectures

Speeches from businesses who have ‘made it’ are a common sight at events as organisers aim to bask in the presenter’s reflected glory. In actual fact, such speakers rarely share any meaningful advice (least of all accounts of the mistakes they made) and attendees’ inspiration on the day can often fade into feelings of inadequacy afterwards.

Speakers at such events tend to have their own promotional (or egotistical) agenda or are being paid to speak – none of these motivations augur well for lasting impact on the audience.

If you’re going to go to these sorts of events, make sure you’re one of the speakers otherwise go watch The Apprentice instead!

4. Community and Ecosystem Events

These are events where the participants leave their sales patter at the door and focus on learning, sharing and getting to know each other properly.

These are by far the best sorts of events but they require participants to take a “rising tide lifts all boats” attitude instead of seeing business as a zero-sum game.

They tend to favour open networks in specific geographic-areas like cities, where there is a likelihood of the participants meeting regularly in the future.

Examples of such events include hackathons, art festivals, startup weekends, masterclasses and mentoring sessions. They are a common sight in startup communities and creative groups where participants share similar problems but are not in competition with each other.

The power of these events is that they help nurture communities far more and over a longer period of time than any other event format.

The idea of a business community can seem pretty oxymoronic when everyone is taking part in a race-to-the-bottom fight to sell stuff, but for innovative, creative and intellectual property-based businesses especially, they are an incredibly powerful way of sharing knowledge and growing local ecosystems collaboratively.

These sorts of networks are the secret sauce that give rise to Silicon Valleys or artistic movements. Crucially, these work best as self-organised events which are led by the participants and supported (but not led) by public sector organisations.

Leicester Comedy Festival, now in it's 23rd year, is a brilliant example of an ecosystem event. As well as being a vehicle for top-class established comedians, it helps nurture new talent, supports venues all over the city and is a fantastic PR and economic draw for the Leicester.

                                                                                                                       

Next time you consider attending a business event, ask yourself why the exhibitors or presenters are there. If you don’t like the answer, then it’s probably time to run your own event. It’s surprisingly easy to do and you can start small using tools such as Meetup.com or Eventbrite.

Aim to build (or contribute to) a community rather than just hosting a one-off event. Focus on something that helps your whole industry rather than just your particular profession. 

For example, a plumber is far more likely to attract homeowners if there are electricians and kitchen fitters at the event too. Encourage advice-sharing rather than hard-selling.

If you're a public sector officer, why not get to know and support the ringleaders of existing groups better instead of running expensive generic events yourselves? Your efforts will be far better targeted and will support people who have a long-term vested interest in the success of your area.

Smashing The Factory Whistle

It's official - Leicester has a tech sector!

My lobbying TechCityUK.com last year seems to have paid off as we have been featured on their 2016 Tech Nation report (page 30): http://www.techcityuk.com/technation/

I appreciate there's always a certain amount of spin associated with such reports but they do serve to highlight a more ambitious mode of business which I think Leicester needs to latch on to. We have a 'factory whistle’ mindset where too many of those who do start their own businesses do not aspire beyond the freelance, consultant or professional services agency models.

This seems to be echoed by official business support agencies who seem to value job creation over all other aspects of business growth. No one can argue against creating jobs but what about the quality, sustainability and wealth-creation potential of those jobs?

Our business development agencies rightly focus on our strengths in particular industry sectors (https://www.llep.org.uk/strategies-and-plans/sector-growth-plans/) but we hear less about the nature of specific businesses that are supported. Are we shipping pies or pie recipe books?

I’ve spent 14 years working in the software and creative industry in Leicester and have increasing experience of the ‘Silicon Valley’ tech startup model. These are a world away from the traditional Leicester hosiery mills but it sometimes feels like the city’s aspirations haven’t moved on from there.

I would like to see people from all sectors move higher up the food chain and break out of the "selling time for money" business model that so many are stuck in (myself included to some extent).

Creative and innovative people are the key to this, there are loads of them in Leicester and they inhabit all industries and all walks of life but you can't really call them a 'sector'. If J.K. Rowling or Mark Zuckerberg turned up in Leicester there would be a huge media scrum but who is giving meaningful support to those who aspire to these sorts of intellectual property-based business models?

My own small efforts in this regard have been to establish a growing tech startup community in the city but I would like to see a much wider community of IP-based businesses. I think the secret is in the cross-disciplinary mixing and getting people to aspire beyond the factory whistle:-

Copywriters can become authors.

Coders can sell apps or SaaS applications.

Actors can become playwrights.

Art workers can become artists.

Designers can license their designs.

Scientists and engineers can license patents.

These sorts of ideas almost always start with individuals and very small teams and it all seems a world away from the 'big hitters' that our economic development people seem to favour. But these are where the world-changing ideas and businesses come from and I beleive Leicester has the all right raw materials for the sort of 'indie' scene that nurtures these.

I don't think the 'sector' approach is helpful here. Technology pervades all areas of life nowadays but try getting an app or a website off the ground without a graphic designer, marketeer or lawyer (not to mention the person who had the idea in the first place who could be from any industry.)

Local success stories like Jadu or CrowdLab (both technology-based but both born out Leicester's creative industry) are testament to this.


What do you call it?

Like Wiley, we kind-of have a naming issue. 'Intellectual Property' sounds like something that only a law firm would talk about, 'Tech' and 'Creative' are too skill-specific, 'Startups' can either mean Silicon Valley or just any new business. 'Innovation' is over-used by the public sector and has connotations of just tech/labs.

What's the right label for creative and innovative businesses that trade on their intellectual property or run scalable Silicon-Valley business models and who do not sell their time for money? Suggestions please...


What needs to be done?

1. Leicester City Council should prioritise getting a city centre co-working space over building Docks 2, 3, 4 and 5 or trying to build a cookie-cutter science park.

2. The LLEP need to come and meet the micro-businesses instead of hiding behind their dreadful Biz Gateway website - get out of City Hall guys!

3. Our universities need open their doors to the outside world and realise that they're not necessarily the best environment for getting businesses off the ground. Knowledge transfer is a two way street! 

4. Makers, Artists, Coders, Writers, Scientists, you need to plan your route to quitting the day job, build your own communities and lead our well-intentioned public sector supporters rather than expect them to build everything for you.

Charles Landry, author of The Creative City: A Toolkit for Urban Innovators once described cities like Leicester as "places where good ideas come to die” - are we going to accept this label? 

Leicester Needs a Community Co-working Space

The time is right for Leicester to have a large city-centre co-working space.

Co-working spaces are large, mostly open-plan offices which provide somewhere for freelancers and early-stage entrepreneurs to work cheaply and without commitment. They are a common sight in cities across the World. As well as somewhere for people to work, they also provide a ‘village hall’ for a wider constituency of event organisers (whether involved in business or not.) They are typically open to everyone throughout the day, with evening and weekends access to paying members.

Impact Hub Islington

Support for the first couple of rungs of the entrepreneurial ladder (conceiving ideas and finding other people to work with) is patchy in Leicester as I have touched upon before. Public sector support has historically only kicked-in once someone has a business plan and is ready to commit to renting a proper office.

A co-working space would help fill that gap, creating a fertile environment where a diverse bunch of people from different backgrounds can mix, share ideas and plan enterprises. The potential as a vehicle for graduate retention through getting recent De Montfort University and University of Leicester graduates to stay in Leicester rather than brain-drain to London or elsewhere is significant. It also creates a nursery for new business which compliments existing provision like LCB, Dock, Makers yard and Phoenix which are aimed at more established businesses.

DMU’s Innovation Centre co-working space has been a success in terms of the actual facility and helpful support staff and there is a lot that can be learnt from it. However, the 9-5 opening hours are unworkable for anyone involved in a serious startup and the on-campus location creates a perception of belonging to DMU rather than the wider community.

Other venues such as LCB Depot, Phoenix and local coffee shops can work on a casual basis but they tend to be noisy, have patchy opening hours and aren’t big enough to achieve that ‘critical mass’ that lends itself to frequent serendipitous meetings with interesting people.

There are potential locations at Pioneer Park or Friars Mill but these sites are too far off the radar of students who would be a key potential user group.

Having nurtured Leicester’s startup community and also been involved with other groups such as Creative Coffee, it’s my belief that such a space needs to be situated within or near the triangle formed by Cultural Quarter – DMU – University of Leicester. The proximity of the railway station is also relevant for connections to London and other local cities.

My understanding is that co-working spaces tend to be comparatively low-cost re-fits compared to new build spaces such as Dock. They don’t need to be glamorous Grade-A office space, indeed the Berlin-style ‘shabby-chic’ can often be an attractor to the sorts of people who typically use them.

I don't know what the finance numbers look like but this feels like something that might need public sector funds to get off the ground but should fund the on-going costs itself through membership fees. This seems to be what happens elsewhere.

Having an independent organisation responsible for the day-to-day may also be desirable to avoid any financial dependency or ownership perception issues. It may be worth exploring some of the established franchises out there such as Impact Hub, WeWork, TechHub or Innovation Warehouse. It might also be worth looking at Antenna in Nottingham as a comparison with a similar-sized city.

I note that Leicester Hackspace are currently looking for a new venue and there is an obvious attraction to having them under the same roof as more software or design-orientated users.

This is not a particularly radical idea. There are hundreds of examples of such spaces in cities of a similar size to Leicester and worldwide and there are any number of franchises, models and providers from which best practice can be gleaned.

My personal interest is as A) a space to run events for the Leicester tech startup community which I organise and B) as a place to meet people with great ideas for win-win joint ventures for my web and app development business.

I have already had positively-received discussions with a number of organisations and groups including the two universities, the city council and the LLEP as well as the grass-roots business communities that I am involved in. If you're interested in being involved in this discussion with potential stakeholders then please drop me a line at ben@ultimateweb.co.uk

If you think a co-working space might be somewhere you would want to work yourself then I would encourage you to joing the new meetup group created by Edward Woolley from our local startup community: http://www.meetup.com/Leicester-Co-working/.

UPDATE 21/04/16: If you are interested in using a potential Leicester co-working space, please fill out this brief survey to help understand current demand: http://goo.gl/forms/QfZsAQ2q2p

UPDATE Autumn 2017: We now have a serious project underway to open a Leicester coworking space and are accepting sign-ups from prospective tenants: http://leicestercoworking.co.uk/.

20 Ways That Universities Can Encourage Enterprise

I’ve been working with universities for a number of years, watching how they wrestle with the increased pressure to ‘do business’. I’ve seen some first-rate ideas come from academics and go on to succeed as viable businesses and I’ve seen some dreadful ham-fisted attempts to ‘own’ business too.

Here’s my tech entrepreneur’s take on how universities can develop a more enterprising culture:-

1. Adopt a default position of laissez-faire on all “incidental” staff intellectual property. “Incidental” defined as not directly related to core research or “not what you were paid to discover”. You could make this conditional on said IP being declared to your organisation.
   
2. Distinguish between patentable and non-patentable ideas. Universities should certainly protect applicable ideas with patents and license them to the highest bidder but many highly viable business ideas are not protectable and trying to ‘own’ them is often likely to stifle them. Academics write books all the time and universities don’t make claims on their copyright so why should code or business plans be any different?
   
3. Keeping non-patentable ideas secret in order to protect them is usually a mistake. The chance of someone stealing a business idea is much lower than you think and sharing ideas with a wider constituency of trusted people is the very best way of getting valuable feedback, advice and introductions.
   
4. Clearly state IP and enterprise policy to staff rather than just tucking it away in employment contracts. Express it in a welcoming and supportive way (e.g. “if you’ve had an idea, we’ve got your back”) rather than treating it purely as the “possession” of the institution. An open hand can hold more than a clenched fist.
   
5. Do not assume that academic staff and students are incapable of functioning in business. This approach will undermine the inexperienced people and alienate the capable ones, risking the creation of a black market or losing people altogether.
   
6. Implement fast decision making on licensing. Some universities can take months to decide what should happen to a business idea — for many startups that’s enough time to build the product and start selling it! Be like Stanford and let experienced KTP staff make the call on it rather than having to run it by academic committees.
   
7. Operate a consensual, negotiated approach to equity or royalty shares as opposed to arbitrary or default percentage expectations. Every contributor to a business (staff, students, departments, the university, investors, external business people) should be rewarded fairly according to their contribution over the lifetime of a business. “The idea” is only one component of a successful business and hoarding ideas will yield 100% of nothing.
   
8. There are plenty of amazing outcomes for universities beyond just earning money from IP. These include economic and societal impact, learning opportunities for staff and students, closer relationships with host cities, wealth and job creation for the surrounding region, better graduate retention in the region plus the general reputational value to the university. Be like Stanford and seek the best outcome for ideas not just the institution’s pocket.
   
9. Become an Easy Access IP partner to allows companies and individuals free access to technologies so new products and services can be developed that will benefit society and the economy.
   
10. Publicise university IP and expertise in a searchable format to let the outside world know what you’ve got (hat tip to DMU deputy vice chancellor Professor Andy Collop.)
    
11. Business people are not all sharks intent on robbing you blind (any more than academics are all public-spirited saints!) Build close trusting relationships, especially with businesses in your local area and you will generate good karma that will be paid back for years to come.
    
12. Consider offering a special deal for businesses utilising university IP or expertise that locate near to your institution and/or employ university staff, students or graduates. Can you offer them free business accommodation, free legal advice or preferential consideration in IP rights deals? Establish a ‘special deal’ or a Bayh-Dole Act for your city.
    
13. Allow staff and students sabbaticals to start a business with the right to return guaranteed. This should be no more difficult to administer than maternity/paternity leave or industry placements and is far better than losing them altogether. Returning staff and students will bring back new experiences (whether they succeed or fail) that will enrich the university.
    
14. Host events like postgraduate research festivals or enterprise conferences off-campus and nearer the general public and business community to help expose what you can do.
    
15. Treat knowledge transfer as a two way street. Universities may be great and inventing new things but most often the best people to execute those ideas are off-campus. Attempts at wholly in-house “spin-offs” do not have a great success rate. Great ideas do not care about the badge of the institutions involved — they just need the right set of people to conceive and execute them.
    
16. Get local entrepreneurs involved in university life and build trust with the local business community. This is a far better way of nurturing ideas and businesses and can create the opportunity for the win-win for the whole regional economy.
    
17. Don’t assume that big high-profile companies are necessarily the best businesses to have on campus. You could be just conditioning your graduates to work for The Man when many could gain a far broader range of experience by working in smaller businesses and startups (including their own.) Consider the value of nurturing a homegrown Blackboard, Udacity, Dropbox or even a ParticiPoll (shameless plug!)
    
18. Successful business communities (especially innovative, creative and technology-orientated ones) tend to be loose networks whereas universities tend to be hierarchies. Don’t assume your rank in your organisation will be meaningful outside of it and don’t make outsiders have to wade through your bureaucracy to get things done.
    
19. Encourage or invest in local, off-campus co-working spaces, incubators and accelerators that create the right environments for ideas and skills-sharing between academics, students, local businesses and the wider public.
    
20. Recognise that enterprise is a culture not an academic subject. It is much more like research (especially methodology such as lean startup) than teaching and the only way to learn it is by doing it.
    

Startups in Leicester: How The Public Sector Can Help

Business support for innovative startups in Leicester is not focused on the right things and this symptomatic of a common misunderstanding of what a startup really is.

Public sector organisations often often assume that startups are just young SME companies. They also often end up supporting business services agencies rather than teams focussed on innovative and scalable business ideas.

As a result, support schemes often require startups to write business plans, incorporate, register for VAT, rent office space etc, before they have worked out a clear business model. At best, jumping through these hoops makes extra work for startup entrepreneurs when they should be focussed on prototyping and validating their product. At worst it can be a waste of everyone's time and money.

Young SMEs who are already establishing the paraphernalia of business (office, telephone number, business cards, etc) are certainly worthy of support but they are not really startups and their needs are quite different to startups.

SMEs tend to sell their time and expertise for money which tends to limit their ability to grow. Startups strive to create scalable products with a global reach like Facebook, Dropbox or Twitter. Typically startups derive their income from intellectual property, global sales or subscription-based income.

Again, absolutely nothing wrong with accommodating and nurturing business-to-business SMEs (I've run one such firm myself for the last 12 years) but they are less likely to create profound innovation or help turn your city into a thriving Tech City or Silicon Valley.


What Are Startups and How Can They Be Supported?

The reality is that a true startup is nothing more than an informal bunch of people with a wild idea and the enthusiasm to see where it can take them.

Stanford professor and Lean Methodology pioneer Steve Blank defines a startup as:-

"An organisation formed to search for a repeatable and scalable business model".

These are very speculative organisations who are highly innovative but have a high 'failure' rate. These frequent 'failures' however do not mean bankruptcies and lay-offs - they mean quickly testing business ideas and gaining insight without spending lots of money or over-formalising. They are experiments not companies.

Such innovative organisations should not be pressurised into formalising their businesses prematurely but they are absolutely worthy of support.

Key things that startup entrepreneurs really need include:-

• Sources of inspiration for business ideas.
• Opportunities to meet diverse potential co-founders.
• Moral support and mentoring from peers.
• Informal access to experts in their field.
• Education on quickly validating business ideas and building prototypes (especially Lean Methodology.)

Above all, they need the support of an entrepreneurial ecosystem as championed by Brad Feld in his pioneering book Startup Communities, based on his experience in Boulder, Colorado. Feld is very clear that these need to be entrepreneur-led grass-roots communities rather than top-down public sector initiatives but that doesn't mean that the public sector has no place in an entrepreneurial ecosystem. It just requires a more nuanced, light-touch approach where the public sector feeds rather than leads entrepreneurial activity.

Here are some examples of ways in which the public sector in Leicester could help startups:-

• Fund cheap, large-scale, low-commitment co-working space close to the universities and cultural quarter but let startup-friendly organisations run things.
• Make it easier for community organisers to access free or cheap event venues (especially in the evenings) to spread knowledge.
• Promote existing startup activities to help accumulate a critical mass of participants. 
• Build better bridges with the universities to break the still-present town-and-gown mentality.
• End the artificial pigeon-holing and separation of 'technology' and 'creative' businesses - they need each other.
• Open public sector data to the public to support the civic hack community.

Leicester already has a small but flourishing startup community which I helped found at the beginning of 2013 based on Brad Feld's wisdom. We've gone from a couple of meet-ups a month to typically 5-10 with a wide range of activities including startup weekends, hackathons, seminars and mentoring sessions. We also have the beginnings of a base camp for activities in the form of accelerator and co-working space Incubate Leicester which opened its doors earlier in May 2014.

If Leicester aspires to produce its own Facebook or be a Silicon Valley then it needs to prioritise developing an entrepreneurial culture over ploughing into expensive copycat science parks or giving perks to SMEs. The good news is that raw materials are all around us with two great universities, a cosmopolitan population and a flourishing creative business community.

We've already had some enthusiastic, albeit limited, support from Leicester City Council, University of Leicester and De Montfort University, particularly with hosting startup events. However, there is a lot more potential for support in the way of facilities and activities which focus on informality, serendipity and the growth of the ecosystem.