The statistics when it comes to opening a new business in the UK are astounding – 660,000 new companies are registered every year which equates to 70 new businesses every single hour. So it’s not surprising that a significant proportion of these businesses fail – 60% of newly registered businesses go under in their first three years of trading, with 20% shutting up shop within their first year.
Despite these odds – and an uncertain economy – starting a new business remains an attractive prospect. Between 2018 and 2019, the total business population grew by 200,000 (3.5%), according to the Federation of Small Businesses. Mark Hart, Professor of Small Business and Entrepreneurship at Aston Business School, said the demographic of these entrepreneurs are heavily in favour of UK-born people from ethnic minorities and immigrants to the UK, with both groups nearly twice as likely to be early-stage entrepreneurs compared to white British people, with black people leading the way.
With the market now more uncertain than ever, business founders must battle against the odds, as we prepare to emerge from lockdown after the COVID-19 outbreak to a significantly impaired economy. As such, one of the most valuable ways a successful and established business owner can give back is by mentoring the next wave of young entrepreneurs.
Founded by Connie Nam in 2012, Astrid & Miyu is a contemporary London-based jewellery brand that revolutionises the way consumers shop and wear jewellery. Connie launched a Business Accelerator programme for young retail businesses in May and one specifically for young black entrepreneurs during June 2020. This article looks at five ways business owners can pass their expertise onto the next generation of founders advised by Connie Nam herself.
Draw on your own experiences
Setting up your own business is hard. The risk is high, the hours are long and there are no guarantees for success. One of the hardest parts of founding a start-up is the feeling of loneliness – that you are going through this enormous, stressful life event on your own. It can be helpful and supportive to hear that successful entrepreneurs felt exactly the same way when they were starting. Having access to an empathetic ear from someone who really understands the entrepreneurs’ unique challenges, can be very supportive emotionally, as well as in a business sense.
Offer financial backing
You need capital to start a business and, often, the unforeseen costs will keep coming. Black business founders could benefit from established businesses providing modest grants or loans to see them through the initial bumps when starting out and trying to scale.
Share expertise within your business
When you set up on your own, you do everything – literally. People will always be naturally more comfortable with some tasks than others. For example, an entrepreneur might have a faultless, clear and creative vision for their company, but struggle a little with the numbers. Established business owners can make a difference to start-ups by offering their own expertise, along with the experts within their company from the head of retail to the head of finance.
Introduce mentees to their own support networks
As well as knowing somebody who has gone through these business-starting stresses in the past, it can be great to meet someone going through them now. When businesses mentor a number of start-ups they can introduce the founders to other likeminded entrepreneurs, enabling them to form their own support network. This can be invaluable in terms of forming relationships that support the unique needs of the start-up entrepreneur.
Share useful contacts, from investment partners to commercial property and retail specialists
One of the toughest aspects of business is choosing the right partners to trust, whether that is who you approach for investment or who you partner with for your first commercial space. Established business owners can introduce their mentees to trusted contacts and give them a leg up over the various hurdles they will face.