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INSIDE:

Enterprise and Entrepreneurship You want to start a business at York? Former South Korean Prime minister on green growth Are Social Enterprises worth anything? 1

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Contents Worldwide economic update..................

4 Syria special..................................... 5 Start a business at the University of York........ 7 Why social enterprise is for the bin............. 9 Social Entrepreneurship ........................ 11 How do we FeedYork’s homeless? ............ 13 Government entrepreneurial policy ........... 15 Interview with Dr. Han Seung Soo .............. 16 New media ..................................... 20 Young Rewired State ........................... 22 Interview with Chris Etheridge ................. 24 The York Entrepreneurs Society ................ 27 The BRIC wall ................................... 29 Enternships ...................................... 31

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Economics Society

The University of York

Editorial

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n this edition we hope to compile the experiences and resources key to doing something individual and entrepreneurial whilst you are at York. Whether in orthodox business or as part of an alternative business structure such as a Social Enterprise. Whether just starting to build your personal network (see the interview with Chris Ethridge) or setting out to rule a country (see the interview with former South Korean Prime Minister, Dr Han Seung-Soo); this edition covers the broad spectrum of enterprise and entrepreneurship and the different meanings these terms can come to contain whilst you are at university and beyond. In one memorable conversation I had with an Economics student at York, I received the following response to my complaints about the Economics department, the Economics society and the university: “ I averaged a first last year and landed a graduate job that pays £58k/anum (sic) so I wouldn’t say it was a waste of time personally ... perhaps for less able students.” It made me realise that some people really do just see university as a means to an end; no matter how dry the course is, no matter whether they dreamed of banking as an imaginative, cleareyed 12 year old: propaganda from the big banks and the siren-call of an unbelievable salary is sufficient to turn us into driven, arrogant and materialistic university-machines, collecting positions in societies for our CVs and racking up scores high enough to impress Goldman. But seeing university as a means to an end is, to my eyes, an utterly wasteful way to approach these three years. At some point, “progress” will clearly present itself to you as a meaningless path to the day you die. Collecting experiences, like badges on a scout shirt or photos in an album is helpful for interviews, it is

Upcoming: Annual Economics Society Christmas Ball and Elections: details tba

great as a way of persuading people that you have not pissed away your time; but it simply isn’t the same as really being here because you want to enjoy being here. I hope this is obvious, but people are not just sinewy, living CVs: no matter how the SchoolUniversity-Job-market production chain attempts to package us. I am irritated by every imperfection and euphoric every time it feels just right. Anything else seems too much like apathy, even if my own attitude is emotionally exhausting, occasionally grating and persistently high-horse-istic. Whilst getting a good job is obviously a key and essential reason for coming to university, and for doing anything, if this is the only reason, I cannot help but feel that you will not get as much out of the things you do as you potentially could. I hope that you find in this edition a directory of some of the unshaped resources abundantly at your disposal at this fantastic university and create something brilliant and memorable during your time here. We also happily include a nostalgic but searing glance back at the contents of a previous edition with a feature on the Syrian economy. This is a must-read article written by the pioneering Econsoc member behind our elegant new website. - Equilibrium Editors

Dominic Falcao

Upasana Bhaumik

Printing: Sub-editor: James Lomas Graphic designer: Jessica Ochalek 3

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Worldwide Economic Update By Harry Quilter-Pinner; Vice President of the Economics Society. Currently on a yearlong internship at the Foreign and Commonwealth office.

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Eurozone: Hardly resolved but more stable.

The fundamentals of the Eurozone crisis remain but it’s been a reasonably positive month in the Mediterranean with fears of a Greek exit temporarily at bay. The Eurozone crisis is far from resolved. Portugal, Spain and Greece all face years of austerity, the latter needing to find €13.5 billion in the next two years alone. Meanwhile growth remains elusive; economic activity in Europe contracted by 0.25% in the first quarter of 2012 according to the IMF. Even Germany, the powerhouse of Europe, is facing weaker growth. Four leading German economic think tanks have cut Germany’s predicted growth in 2013 to just 1% and warned that any escalation in the Eurozone crisis could cause a double dip recession. The IMF has also weighed into the debate, reducing growth forecasts for 2013 across Europe (see figure 1). Although just two months ago there was an air of inevitability around a ‘Grexit,’ which would have almost certainly led to the breakup of the Euro, this has been shelved thanks to better management of the crisis, the creation of a banking union and September saw the ECB announce plans to buy up the debts of struggling European countries. Furthermore both Greece and Portugal have clamed markets by progressing with aus-

terity measures. However, while economic tension has receded somewhat, political tension remains. Protests in Portugal and Spain over austerity continue. In Greece, Angela Merkel’s visit sparked riots. Despite these problems, the Nobel Prize for peace was recently awarded to the European Union, for having turned Europe ‘from a continent of war to a continent of peace’. The US fiscal cliff: There’s at least one landslide in this Presidential election Recent data from the US suggests there is some light relief for the beleaguered US economy but the long term outlook remains grim, with poor economic growth and a large deficit to deal with. Ultimately the American presidential election in November will be decided on the economy. Obama’s inability to defend his economic record in the recent Presidential television debate is one of the reasons for Romney’s more positive polling figures; yet a short term upturn could push Obama ahead. The Bureau of Labour Statistics announced that unemployment had fallen to 7.8% in September from 8.1% a month before. Meanwhile the participation rate, the share of the labour force working or looking for work, has also increased representing a further boost to the macro economy. Fi-

nally, the FED has announced the open ended purchase of mortgagebacked bonds which has spurred stock markets to a five year high. However the long term economic outlook in the US looks gloomy. Thus far, growth in 2012 has averaged a very ordinary 2%. This may even decline in the fourth quarter. By far the most pressing problem facing Obama or Romney is deficit reduction and America’s looming fiscal cliff: $600 billion worth of tax cuts introduced by President Bush which will automatically end in 2013, thus knocking 4% off GDP. This would undoubtedly return the US into recession, bringing down much of the world economy with it. Emerging markets: Slowing down? The last decade has seen the birth of the Emerging Markets, however recent events point to an economic slowdown in the world’s fastest growing economies. The so called Emerging Markets have been one of capitalisms greatest success stories, challenging the rise of developmentalism. At times over the last decade both China and India saw growth in excess of 10%, with Brazil and South Africa not far behind. Even as America and Europe stumbled in the midst of an economic crisis in 2010, China and India’s growth exceeded 9%.

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EQUILIBRIUM Significant growth in these countries, as well as in others such as Indonesia, Turkey and Nigeria, is now considered key to worldwide economic balance. Demand for goods and services from developing countries is the only way to ensure a recovery in worldwide economic growth. It is therefore extremely worrying that the last year has seen a severe slowdown in economic growth in the emerging economies. In the second quarter of 2012 China announced its lowest growth in three years and Indian growth is now at its lowest since 2004. South African growth has fallen to just 2.6%, with a similar figure seen in Brazil. Why are the emerging economies beginning to submerge? Some of this fall in growth is due to the Eurozone spill over effect. Europe is one of the largest markets for emerging markets buying about 19% of Chinese exports and 22% of South Africa. Another reason is economic mismanagement by these countries, the most notable example being China who has kept interest rates high. However it is arguable that the remarkable growth rates seen in these countries were caused by high commodity prices and easy credit (see Sam Yates’ article, this edition), which has now dried up. If the latter is true it is questionable whether growth at that level is attainable in the future. This leaves the world wide economy with a demand void and we must ask: who can fill it?

SYRIA SPECIAL The Syrian economy: What happens to an economy in a state of conflict? By Harry Quilter-Pinner

Vice President of the Economics Society. Currently on a yearlong internship at the Foreign and Commonwealth office.

Summary

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he UN estimates that 23,000 people have been killed in the Syrian civil war; that’s nearly 2 people every hour for 18 months. However death is not just caused by weapons; the deterioration in the Syrian economy could add considerably to this figure, both now and in the future. Humanitarian aid must be provided over the winter to save lives in the short term. Furthermore, Western governments must start planning for the significant task of rebuilding Syria’s economy post Assad.

population, in disarray. The Syrian economy has customarily been reliant on the state for coordination and economic management. All produce, both oil and agriculture, is sold by individuals or companies to the state. The state then exports it or redistributes it amongst the Syrian people.

“In the past, oil and gas revenues have constituted around 20 percent of Syrian GDP and 25 percent of total government revenue.”

The Economy that was

In the short term

The Syrian economy has traditionally been based around oil and agriculture. Both of these sectors have been crippled by conflict leaving the economy, and the Syrian

However, as it wages war on its own citizens, the Syrian government is no longer fulfilling its distributional role. The civil war in Syria has ensured that internal distribution 5

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EQUILIBRIUM of goods has completely broken down. Uncertainty is rife and the population no longer trust the state to supply sufficient food. Producers have begun hoarding agricultural goods to ensure their own survival. This has caused severe food shortages and significant inflation, which the central bank reported at 36% in June. The result has been wide spread starvation and deprivation amongst the nonfood producing element of the population. The oil industry has also been drastically affected by the war. Western partners, notably Europe, have introduced sanctions on Syrian oil exports in an attempt to force President Bashar Assad, the Syrian dictator, out of power. In

“...in total, 589,000 buildings – including residential homes, schools, mosques, churches and hospitals – have been destroyed.” the past, oil and gas revenues have constituted around 20 percent of Syrian GDP and 25 percent of total government revenue. However sanctions have dramatically reduced oil revenue which has a knock on effect on GDP. Syrtol, the state owned oil company, has attempted to find new markets to export its oil to, but cannot do so at a rate quick enough to stabilise oil revenues. In total, Western sanctions on Syrian oil are estimated to have cost the government $4 billion in lost revenues. As well as causing a fall in GDP this has led to a severe foreign currency crisis which has hampered the ability of the central bank to

intervene in the economy or service Syrian debt. The macroeconomic environment has essentially broken down. Sanctions have also impacted on Syria via its imports. Syria is a net importer of petrol and energy. EU sanctions have reduced energy supply to Syria, as a way of putting pressure on the dictatorial regime. This energy shortage is worsened by the destruction of key infrastructure used for distributing energy. Electricity and heating blackouts are common. This is clearly a drag on economic activity as it creates uncertainty and interrupts any machine based production. In the long term firms cannot function without reliable power and heat. More importantly, nor can human beings. If sustained, blackouts, along with food shortage could lead to a severe loss of life over the

winter. The United Nations’ Food and Agriculture Organization and the World Food Programme (WFP) estimates that about 1.5 million people in Syria need immediate food aid and that one in three rural residents will need help, both in terms of food and heat, over the next three months. No end in sight Conflict of this type also has significant long term consequences. There has been a large amount of capital lost during the war. Per-

“The Western world must respond.” haps the most obvious forms of capital damaged during the war are buildings and infrastructure. As already noted, distributional networks for energy and oil production have been destroyed. However, significant capital

Father holds his dead son after the bombings in Aleppo, Oct. 3, 2012 Credit: Time Magazine

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EQUILIBRIUM destruction has been pervasive throughout the Syrian economy. The London-based Syrian Network for Human Rights estimates that, in total, 589,000 buildings – including residential homes, schools, mosques, churches and hospitals – have been destroyed, with thousands more severely damaged. It will take huge amounts of investment and a generation of Syrians to rebuild this infrastructure. Until this is done, there will be no ready source of economic growth. Finally Syria has lost an extraordinary amount of human capital during the conflict. This is not just through loss of life, which is undoubtedly significant, but also refugees leaving the country. Those fleeing Syria number 311,000 so far, however

the UN estimates this could rise to 710,000 by the end of the year. All of these factors make Syria’s long term economic future bleak, even if Assad is unseated in the near future.

finances, to rebuild Syrian public services ensuring growth and prosperity for the Syrian people in the future. Failing to provide this

The West has a role to play The Western world must respond. It is imperative that Europe and the US provides humanitarian aid to Syria’s struggling population over the winter. This will help prevent further unnecessary loss of life. In the longer term we must also recognise our role in legitimising Assad’s regime pre Arab Spring and compensate the Syrian people accordingly. The West should use its expertise in health and education, as well as its

Woman mourns the loss of her husband and two children who were killed after their home was shelled. She survived. March 10, 2012 Credit: Time Magazine

support could be just as destructive, and make us just as culpable as Bashar Ashad and his dictatorial regime.

START A BUSINESS AT THE UNIVERSITY OF YORK! U

niversity is one of the best places to begin to cut your teeth in enterprise. Even though students don’t have much, if any, income and need to look after the money they have, they rarely have mortgages, families or unexpected costs to deal with. As a result, it is one of the less risky times to test out some ideas and learn the basics of running a business. Not only that, but the development of the Ron Cooke Hub, on Heslington East, signals the University of York’s intention to continue to drive entrepreneurship at the university. There are plenty of

opportunities for funding, advice, networking and the use of the excellent facilities at the university which any aspiring entrepreneur can and should make use of. Similarly, recent government initiatives such as the SEIS scheme have opened up new opportunities for funding at a national level. Starting things off Once an entrepreneur has come up with an idea that they are confident has a chance, they need to test it out to see if their feeling is well-founded. This can sometimes

be done for free, using surveys, market research and free advertising to gauge interest. However, at some point, the idea will need to be funded to take it into the next phase of development. In recent years, the university has provided a Proof of Concept fund. The fund can provide financial backing of between £250-1000 to help establish whether a business idea may be successful. Although the website claims that the deadline for applications has passed, it continues to fund successful applications, supporting a number of business ideas last year. More 7

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EQUILIBRIUM information can be found on the University of York website. University of York competitions You can also acquire funding through competitions held on campus. Last year, the university ran an event called York Solutions, in which teams were required to come up with a solution to a commercial or social problem of their choice and present their ideas to a panel of judges. The event, sponsored by Santander, provided the winning teams with £1000 each to invest in their solution. The overall winner, Shaan Bassi, received an additional £500 for his HIV awareness campaign. The York Entrepreneurs Society will also create opportunities for winning prize money, as well as work experience, through competitions during the year. The Society’s flagship event, The York Apprentice, involves five days of challenges with the winning team securing a prize pot of up to £1500.

throughout the year; more information can be obtained by emailing entrepreneurs@york.ac.uk. In addition, The Careers Service and Enterprise Office provide a wide range of opportunities for learning. The Student Internship Bureau (SIB) advertises paid opportunities for York students which can provide the chance to develop skills and meet individuals in

“The University’s £750 million development on Heslington East has created a range of facilities and opportunities for entrepreneurs.” sectors that you are interested in working in. A final excellent resource which remains underused is the university alumni network,

tact these individuals- you never know what opportunities you could find from doing so. The University’s £750 million development on Heslington East has created a range of facilities and opportunities for entrepreneurs. The campus houses the Ron Cooke Hub, which contains a number of excellent facilities. There are hi-tech multimedia facilities, including Apple Macs complete with design software for student use, app development facilities and a Springboard space, in which start-ups can rent office space at good rates. There are a range of start-ups already based on Hes-

Another great strength of the university environment is the multiplicity of occasions to network and find out about business opportunities. For example, the York Entrepreneurs Society provides a

“Once an entrepreneur has come up with an idea that they are confident has a chance, they need to test it out to see if their feeling is well-founded.” platform for networking, learning, discussion and involvement in a range of interesting events

Ron Cooke Hub / (c) Martine Hamilton Knight

which contains entrepreneurs in a wide range of fields, from technology start ups, to successful service businesses, like Richard Harpin’s Homeserve. The Careers Service can provide advice on how to con-

lington East in the Springboard and Catalyst, which provides an excellent opportunity for students to introduce themselves and learn from other young entrepreneurs. Meeting with individuals who

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EQUILIBRIUM have already started along the entrepreneurial path allows you to be aware of some of the pitfalls that novices fall into, so that you can more easily avoid them.

less work required of the professional, the cheaper your legal fees will eventually be.

Young businesses often need some sort of legal advice for aspects of their business; for example, advice on how to structure terms and conditions. The Law Department on Heslington East is a valuable

Nationally, there has been a major shift in the government’s focus to SMEs in order to stimulate the economy. The launch of their SEIS scheme, which provides tax incentives to investors in small businesses, has meant that high net-worth individuals are looking to invest in promising start ups as a financially attractive option for their money. The scheme remains

“Meeting with individuals who have already started along the entrepreneurial path allows you to be aware of some of the pitfalls that novices fall into...” resource for this information, and assistance from law students can often be obtained for free. This can be very useful in getting a solid foundation for your legal documents before having a professional lawyer check them through. The

A national perspective

officially open until April 2013 (but may well be extended), and entrepreneurs looking to obtain funding should look out for regional events involving angel investors and web-based platforms linking investors with start-ups, such as Kickstarter and Seedrs. If you want to be an entrepreneur, you need all the help you can get, because it is a very steep learning curve. However, the opportunities for support and learning at the University of York mean that there is no better time to try to turn your ideas into reality.

Focus Box In addition to the departments and websites mentioned in this article, below are some website links that contain other useful information and are well worth look at. www.yorkmeansbusiness.co.uk www.bsyny.co.uk www.businessinyou.bis.gov.uk www.yorksife.co.uk

Alienating the milk of human kindness: why social enterprise is for the bin By Dan Howdon, a PhD student at the Centre for Health Economics at the University of York and affiliated to the Health, Econometrics and Data Group, focusing on inequality of opportunity in health and the impacts of lifestyles and circumstances on individuals’ health. ocial enterprise connotations of fuzzy niceness, is a seemingly Well, at least with entrepreneurs, and a social institution in which to universally popuwe know what we’re getting: invest your outmoded feelings of lar concept: all profit-maximising, borderline solidarity, or caring. So, what is a three party leaders sing its praises. psychopaths going all out to make social enterprise? Even supported by your leading what they can for themselves1. liberal newspaper through theSocial enterprise, however, is truly They’re either organisations “with guardian’s socialenterprisenetwork a term for the Blond-Glasman2 era primarily social objectives whose (sic), surely social entrepreneurs of political terminological brainsurpluses are principally reinare at least preferable to the mind crash: a horrendously slippery vested for that purpose”, or “owned of your local confused Marxist? concept to pin down, but with by those who work in it” or with

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EQUILIBRIUM “mainly social and environmental aims [and not paying] more than 50 per cent of trading profits or surpluses to owners or shareholders”3. There’s no clear consensus here. ClearlySo (another one)

“...at least with entrepreneurs, we know what we’re getting: profitmaximising, borderline psychopaths going all out to make what they can for themselves.1” even listed the infamous organisation A4e as a social enterprise, until it turned out that they were doing things that got them a bad press. Something that exists solely as a “hurrah” term cannot be associated with something that is bad.

enterprise Fifteen describes itself as having at its heart “a desire to enable young people to believe in themselves, to show them their past can be left behind and persuade them the future is theirs to create”6. A4e’s “Surround Yourself with Positive People” advice leaflet suggests talking to a counsellor or psychologist if you can’t find enough shiny happy people to boost your employability campaign. Certainly, you shouldn’t be ‘depressed, overeager or frantic’. If you and people around you are depressed (if, for instance, you’re all unemployed with little immediate prospect of employment), medicalise your own condition

Rather wonderfully, the government’s biggest report into social enterprises states that “The Big Society concept was not clearly understood by SEs in the study group, although they like the idea, believing it captures much of what they already do”4. In other words, they don’t know what it is, but they think it’s what they do. It’s become hugely passé to mock the Big Society, but while the askance looks from liberal comedians on Have I Got News For You have all but ended, the vacuity at its heart continues to pollute our social discourse.

and, presumably, preferably theirs too. ‘Besides, who wants to work with a naysayer? No one!’7

What many of these organisations fundamentally share is an insulting can-do, get-up-and-go approach with asinine piffle posing as useful advice (“Why it is important to have a good memory at work”5). Jamie Oliver’s social

Of course, the purpose of a system is what it does, and the push for social enterprises certainly looks like a push for both ceasing to fund, and privatising, services. The same governmental report into social enterprise states “SEs in

particular provide a good fit with the government’s aim of developing the ‘Big Society’, and could play a distinctive part in relation to deficit reduction... [helping to aid] a move away from the assumption that public services must necessarily be provided by public sector agencies.” Some of them may even be set up and staffed by wonderfully well-meaning people, but they’re not political organisations, they’re not even pressure groups, and they have no popular social basis. Good intentions are inevitably crushed by the bigger picture of (current) government policy: that of widespread cuts to public spending.

There almost certainly is something in devolving decisions regarding small-scale policy to local group, but this both requires funding from central government, and patently isn’t apt to care for general social needs. Social enterprises, by and large, constitute a fundamentally antidemocratic means of substituting for genu-

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EQUILIBRIUM inely bottom-up action. Relatedly, it seems that the proliferation of social enterprises as an acclaimed good thing is yet another victim of the “great man of history” fallacy. As a greater man than any social entrepreneur once said, and as any social entrepreneur would never say, “I would not lead you into the promised land if I could, because if I led you in, someone else would lead you out. You must use your

“What many of these organisations fundamentally share is an insulting can-do, get-up-and-go approach with asinine piffle posing as useful advice.”

heads as well as your hands, and get yourself out of your present condition.”8 Social entrepreneurs will never effect any meaningful social change because they aren’t supposed to. Social entrepreneurs are asked to “be the change [they] wish to see in the world”9: it is cer-

tainly unclear, at least to me, how one can be full communism.

“Social entrepreneurs will never effect any meaningful social change because they aren’t supposed to.” Since this is supposed to be an economics publication, let’s end with some economics. I think the conventional wisdom of social enterprises being an unabashed good thing is an almost necessary corollary of the demand for

microeconomic foundations for macroeconomics. Social problems must be inherently reducible to lots of minor problems to be dealt with by, in the unimprovable words of the Housemartins, lots of little Florence Nightingales10. The structuring of society is no longer up for grabs, so best find yourself a local hero. In conclusion, when David Cameron, Ed Miliband and Nick Clegg start praising something that seems nice and shiny, it’s time to go short.

Let’s call them for what they are. Philip Blond and Maurice Glasman, the two Big Thinkers who brought you Red Toryism and (yes!) Blue Labour, respectively. Of course, they both say nice things about social enterprise (I don’t even need to check this to know it to be true). 3 They also have silly names, like ThinkForward or 2020health. 4 http://tinyurl.com/7kfn982 5 Off the Streets and into Work, http://www.osw.org.uk/ 6 http://www.fifteen.net/about 7 An amusing/terrifying account of the A4e experience is available at http://tinyurl. com/93n9e78. “He laughed at my idea that we should deal with this issue as a society”. 8 http://tinyurl.com/95erpub 9 http://tinyurl.com/95ykekw - this particular example of nonsense from “Pamela Positive” is definitely worth a few minutes of your laughter. 10 http://tinyurl.com/9tz6fa2. I actually quite like Florence Nightingale, which could very well be the disclaimer this article requires 1 2

Social Entrepreneurship By Vicnan Pannirselvam

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ur Bismarckloving, baby-hugging skins crawl at the thought of big business getting its tentacles into society; corporate sharks making a quick buck off the plight of people in need – like John Doe, our useful narrative device who not only is hearing-impaired, but also has a convenient criminal record, making him particularly undesirable in the job market. We feel that not only should the  

government ensure than John has the basic quality of life, but that it should also protect him from unscrupulous profiteering.

but confusion as to what it entails.

However, I must confess to being a bit of a shark myself; while I have long been accused of being a bleeding heart, my grounding is firmly in the murky world of social enterprise.

Herein lies one of the greatest secrets of the community (as it were): we aren’t quite sure ourselves. While the passion in the discussions and debates people have all around the world do revolve around how best to save the world, a lot of heat is generated by disagreeing over what social

The world is murky, not just due to the perceived moral ambiguity,

What the Heck is Social Enterprise?

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EQUILIBRIUM entrepreneurship really is. To slay the demon, we need to get into its constituent parts; here’s an unscientific guide to the very many different views the encapsulate the field, distilled by my judgemental involvement over the years: Enterprises that embrace a social cause That these businesses hold close to their unholy bosoms a desire to right some wrong raises many suspicions; they do so either by setting up separate philanthropic arms, like Shell, or via programmes often referred to as corporate social responsibility efforts. The ire felt stems from the fact that these wrongs to be righted could have been caused by the firms themselves; all they are doing is attempting to redeem their souls from the doom of public relations karma, as seems to be slight irony of Shell setting up a foundation to support sustainable development – not helped by the charity getting involved with lobbying the UK government in 2006 for a Russian project mired in environmental concerns. Motivations aside, these programmes tend to be implemented via non-governmental/-profit organisations: for example, a company funds a charity to give John a hearing aid. Enterprises with multiple bottom-lines. If a conventional business is defined by its attention to a single

bottom-line of profit, this view holds that a social enterprise has multiple bottom-lines: profit, rectifying the social issue it has targeted, and particularly now (due to drowning polar bears) also its environmental impact. Within this approach, there are two broad ways to meet the social bottom-line; directly hiring (or in any other way, providing a source of income) for beneficiaries, or a providing a product/service/process that solves a problem. People working to save the world, who use entrepreneurial innovation Another way of thinking about social entrepreneurship is the use of innovation and approaches more common in the world of start-ups and entrepreneurship to address a mission. This significantly broadens the scope, stepping away from needing businesses to be involved altogether. It is the approach that the Ashoka Foundation, whose fellows include Grameen Bank’s Mohammad Yunus and the World Blind Cricket Council’s George Abraham, adopts. As they do not run as or operationally associated with a business, they fall outside this particular discussion; however, as this definition does hold great sway, it is useful to be aware of it when thinking about social entrepreneurship. It is therefore difficult to tar all of social entrepreneurship with the same brush; likewise, we would have to be also wary of praising all activity reporting a social enterprise model.

Various approaches have their merits, and their own place in the civil society eco-system. It is great to have the private sector dipping into deep pockets to fund programmes; but there is little end difference between that and a charity with a brilliant fundraiser. The true value of social enterprise, in my opinion, lies in its sustainability: by including revenue streams, the cafe that hires John does not need to (if all goes as it is supposed to) depend on donations to give him a livelihood. It can be, and is argued in some parts of the world – particularly those with robust social welfare programmes – that this just allows governments to shirk on their responsibility to all sectors of society. While it is difficult for me to fully appreciate an argument against the alleviation of a programme’s tax burden, the valueadd that social enterprises have lies in that they can also operate in a different place all together. While the government can ensure that John has a basic income, it would be difficult for it to replicate the efforts of the firm that has overhauled the design, supplychain, and manufacturing processes of hearing aids – allowing John and others to buy and maintain the devices at an unprecedentedly low cost. Activities like these appear to be outside the realm of the government: either due to a lack of mandate to be moving within that space, or a lack of expertise. While it is in no means a comprehensive defence of social enterprise, it is not meant to be. No generalisa-

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EQUILIBRIUM tion, neither positive nor negative, can serve to be a useful analysis of such a variegated field. Social enterprises also operate in spaces outside of conventional businesses; informed by their cause, they can be designed to fail in the long run. Unlike any other corporation which rates its successes by growth in profit, processes, and/or consumer-base, a social-enterprise (and indeed any civil society body) could be focused on putting itself out of

business. Imagine electronics that do not fail the day after their warranties expire (we have all had a gadget that has done this), but last forever! A caveat: a social enterprise should go out of business only if it has either nullified its customer/ beneficiary base, or can no longer provide the best product to that base. While a firm might not be able to prevent hearing disabilities, it can ensure that no other firm produces cheaper hearing aids.

A final source of discomfort, related to the unease that it should be the government who helps support people and not private industry, is that it is morally wrong to generate a profit out of serving people. Though it probably stems from my own moral bankruptcy, it strikes me that such opposition is more self-serving than anything else. I would not presume to begrudge John an improved quality of life because of my own reservations. A social enterprise goes some distance in correcting the dissatisfactions we have over the priorities of a capitalist society. As one of Facebook’s first employees said: “The best minds of my generation are thinking about how to make people click ads. That sucks.” I’d much rather be able to reward them to improve the lives of people like John, and my own.

Credit: Ashoka Innovators for the Public

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How do we FeedYork’s homeless?

ell me about FeedYork: what exactly do you do? What problem do you solve and why is yours the best solution to this problem? The idea for the project came from the fact that supermarkets and retailers throw away around 6% of all food waste in the UK. Even if this seems like a relatively small percentage, more than 50% of the

food is still edible. Organisations like Fareshare redistribute this wasted food to those who need it the most, however they do not operate in York. Therefore, we thought it would be a good idea to link donors and charities and help them set up schemes of redistribution. However, FeedYork is not only

about giving food. The duality of our project consists in reducing waste, but also try and enable people to develop their skills. The particularity of FeedYork is that we would like to customise the scheme we help set up between a donor and a charity so that it also fits with the aims of the latter. For instance, we work with Orwin House who takes care of individu13

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EQUILIBRIUM als with a long-term alcohol abuse problems, which we are trying to set up with a local greengrocer

“FeedYork is not only about giving food.” and a deli. The scheme, which we would like to set up as a normal scheme at first, aims to finally involve the residents in the process of redistribution, by asking them to go collect the food, complete inventory sheets etc… How do you fund FeedYork? FeedYork is more of a charity project rather than a social enterprise, as we do not make profit. However, various applications for funding such as the YorkSolutions challenge organised by the university gave us the possibility to secure some funds to finance any costs the project may raise. Do other cities do this? Yes, there are a number of nationwide organisations such as Fareshare and Foodcycle. These schemes however encounter some difficulties due to the unfavourable legal framework in the UK regarding food donations. Some countries have much better conditions, for example the US legislation provides better conditions for charity donations of food thanks to the “Bill Emerson Good Sa-

maritan Food Donation Act” that minimalizes the donor liability What happens to FeedYork when you finish at York? FeedYork is under the realm of YorkSife (Student In Free Enterprise), which means it has to fulfil certain project criteria, including sustainability. We hope that once the schemes are set up between the two parties, they will continue without our help once they are organised and the contact is established.

We have encountered a number of problems along the way, especially since UK legislation does not cover charities that deal with food that may present health issues. This complicates getting donors to join the program, especially big supermarkets. However we have managed to get Asda on board thanks to a memorandum

“... we have managed to get Asda on board...” Why doesn’t the local government do anything like this? Have you contacted them? Have they supported you? We have currently secured the support of the York City Council to help us in the project from January next year onwards. As for the national government, Kerry McCarthy, Labour MP for Bristol East, has brought forward in March a European food waste bill aiming to oblige retailers to give wasted food to charity, as well as setting up the equivalent in the UK of the US Good Samaritan Food Donation Act, which exempts from prosecution any food banks and donors who donate surplus food in good faith, if the food turns out to have caused food poisoning, for example. The bill did not pass, but it at least raised awareness on the problem. What has been the most challenging aspect of FeedYork?

of understanding. Moreover, some charities do not have the personnel or time to fully engage in the organisation of scheme, slowing down the process. These problems have lead us to restructure the project and concentrate on setting first a regular scheme between Asda and the Salvation Army, before moving on gradually to other schemes that are, for now, on hold. What would your ultimate vision for FeedYork be? Our ultimate vision of FeedYork would be a self-running program with sustainable schemes based on a communication between the charities and the retailers as well as an active involvement of the residents in the process, provided with a health and safety training funded by us.

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Government entrepreneurial policy: faith unrewarded

By Harry Lambert, 2nd year PPE student and York and the current Politics editor for Nouse

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here are few things a Friedman free marketeer and Hamiltonian interventionist would agree on, but the two would likely find common ground on one issue – one of the most central, enduring and abiding responsibilities of government is to set the conditions most favourable to the development of private enterprise. Indeed, amongst political thinkers of all stripes, or at least all non-Marxist ones, there is almost universal agreement on the importance of doing so. This mission is one the Coalition government have not ignored. Aside from their theoretical attempt to reduce the public deficit, few things have been as stressed by ministers as much as the need to help and promote business. As Parker (2011) has argued, drawing from the analyses of Logan and Molotch, all governments are ultimately driven by a need to create growth. Policies to bolster entrepreneurship inevitably become crucial.

dium sized businesses, or SMEs. This strategy is understandable. As a recent EU-commissioned report has shown, 85% of new jobs created between 2002 and 2010 were by SMEs.1 The government’s approach to helping create and de-

“At the heart of Coalition policy has been a focus on small and medium sized businesses.”

velop these ‘engines of growth’ has centered on three areas: scrapping regulatory restrictions, opening up access to capital for existing business, and making it easier to start a business.

The government’s focus on ridding business of red tape is nothing new. Under the previous Labour government such efforts were repackaged as ‘better’ rather than less regulation, but their mission remained the same, and agencies devoted to this purpose ranged from The Regulatory Impact Unit to the Better Regulation Task Force and Panel for Regulatory Accountability. Evaluating the Coalition’s alternative efforts is challenging. Ministers can point to fewer regulations but that is no success in itself. (continued on page 19)

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Dr. Han Seung Soo Interview with York University

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hat are your views on the Green Development of South Korea and what lessons are to be learnt from other countries? The Republic of Korea experienced tremendous economic growth in the relatively short time period of about half a century. While the positive implications emerging from such progress cannot be doubted, what is also clear

aimed at addressing the root of these challenges. Through green growth we aim to shift our development paradigm in order that we can continue to pursue economic growth, while also ensuring environmental and climatic sustainability. This will be done by setting ambitious but realistic targets and implementing policies and practices that will bring with them short-term costs, but will, in the longer run, not only benefit us, but

Of course, Korea is not alone in its pursuit of green growth and there are lessons to be offered by the example of other countries. One such country is Denmark. If Korea is a “fast mover” on green growth, Denmark is the “first mover.” Denmark’s recently declared goal to transform its entire energy supply to based solely on renewable energy by 2050 is a reflection of its longstanding commitment to green growth. Both Denmark and Korea can learn much from each other’s experiences and this is the basis upon which the Green Growth Alliance between the two nations was established in 2011. What progress has been made by the GGGI? The Global Green Growth Institute (GGGI) was established in June of 2010 at the initiative of the Korean government to serve as a global “think and act tank” dedicated to disseminating green growth and supporting developing

is that we have had to experience our fair share of obstacles that prevent our continued evolution. Notably, our quest for rapid, quantity-oriented economic expansion driven by the consumption of fossil fuels has given rise to considerable environmental degradation and climate change, and we have come to realize the high costs that such challenges create. Korea’s green growth strategy is

ensure our sustainable future. Examples of such measures include creating new engines of growth through investment in clean and renewable energy, green technologies that maximize efficiency and minimize waste, as well as the mitigation of climate change by cutting greenhouse gas emissions and managing precious resources such as water in a more efficient and sustainable manner.

“Through green growth we aim to shift our development paradigm” countries in their efforts to implement their own green growth strategies. Shortly after its inception, GGGI started work with several governments including those of Ethiopia, Indonesia and Brazil to explore green growth opportunities in their respective countries. Since then, GGGI’s work

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EQUILIBRIUM has contributed significantly in shaping the green growth policies of the abovementioned countries as well as a host of others, including Cambodia, Kazakhstan, the United Arab Emirates and more. GGGI has also strived to disseminate and sharpen the theoretical concept of green growth in partnership with other leading institutions and organizations through research partnerships such as the Green Growth Knowledge Platform (collaborative effort by GGGI, the World Bank, UNEP and OECD). GGGI is now in the midst of a new phase in its institutional development. On the sidelines of Rio+20 this past June, GGGI gathered the signatures of 16 countries who have signed the Agreement on the Establishment of the Global

“Depleting fossil fuel reserves, soaring global demand and concern about greenhouse emissions have created significant incentives for the development and deployment of renewable energy sources...”

Green Growth Institute. With this important development, GGGI has created the foundation upon which it can transform into a fullfledged international organization. The principle benefit of international organization conversion will be in enhancing the Institute’s capacity and legitimacy. What impact will this have upon global economics and the future?

Interest in green growth is clearly reflected in the global economic trend. While the recent global financial crisis has meant that governments have had to invari-

“Historically, Korean society placed high priority on public service, then on agriculture, manufacturing and lastly commerce and services.”

ably focus on addressing shortterm fiscal concerns, more and more countries, both developed and developing, realize the need for, and opportunities arising from, green growth. Environmental degradation, climate change, resource depletion and the myriad negative ramifications that result from economic expansion via the “brown economy” do not simply end at national boundaries. Such challenges are global in nature and countries both developed and developing, as well as private enterprises, are making significant shifts in policy and business practice to address these concerns and lay foundations for a more sustainable path based on green growth. How is the environment shaping global business? The environment has significant ramifications on how business is conducted. For example, within developed countries, strong regulations to prevent further environmental degradation have forced its dirty industries to conform to better standards. Meanwhile,

some have resorted to evading regulations by transferring their businesses elsewhere, usually to developing countries where such regulations either do not exist or are not enforced well. But as more developing countries adopt green growth policies and measures this will further increase the costs of doing business in an environmentally unsustainable manner, thereby creating more incentives to shift towards cleaner, green industries. Another way in which we can witness the environment shaping global business is in the area of clean and green technologies, particularly renewable energy. Depleting fossil fuel reserves, soaring global demand and concern about greenhouse emissions have created significant incentives for the

development and deployment of renewable energy sources such as wind, solar and hydro. As more investment is directed towards such technologies and global production increases, the global renewable energy market will continue to expand, creating viable alternatives to fossil fuels and giving rise to new jobs and growth 17

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EQUILIBRIUM opportunities. People talk more about China than South Korea, despite its incredible technical and economics advancement – is this something South Koreans should worry about? China’s economic growth for the last 3 decades has been phenomenal and I hope that China con-

and currently over 80 percent of the high school graduates go to colleges. The highest rate in the world! The educational system is continuously adapting itself to the needs of the society and tries to reflect the pace and content of technological development. Innovation has been the key to Korea’s economic success and how to organize education to promote innovation is an important agenda

society began to pay great respect to the successful entrepreneurs. What does South Korea need to keep on doing to be ahead of the rest? Continuous innovation in all areas. In an age of internet, for example, Korea is one of the most wired countries in the world and therefore, has become the test market for the new IT products. Not only in the area of IT but in the areas of CT(culture), bio tech and life science, and environmentally-friendly energy sector. Korea wishes to be one of the fast movers. What are your memories of York University? Any fond thoughts or frustrations?

Chair of OECD Ministerial, Dr. Han Seung Soo and BBC’s David Eades

tinues to grow fast in the future as in the past. China is now the Korea’s largest trading partner and Korean economy can further gain by closely being associated with China. We can grow together to the benefit of both and our economic relationship can be a positive-sum game. In this respect, it is somewhat worrisome that there is a sign of Chinese economy slowing down. How is the educational system of South Korea changing to adapt to modern needs, and what are the major issues facing continued development? Korean people have always placed very high values on education

for education in Korea. What is your view on entrepreneurship in South Korea? How is entrepreneurship seen as a career path in society? Entrepreneurship is very highly valued in Korea today. Historically, Korean society placed high priority on public service, then on agriculture, manufacturing and lastly commerce and services. However, now, the priority has been turned upside down. In old days, the brightest always went to join public service after passing very competitive higher civil service examinations. Nowadays, many young bright graduates go to join the private sector and the

York in the beginning was the place where you can not do anything but study and study. Perseverance was the only consolation then! I started studying economics at York and owe a lot to teachers, particularly to Sir Alan Peacock for my future career as a successful professional economist. York was then the center of public finance in Europe specializing in the impact of economic integration on taxes and expenditure. I chose to write my doctoral thesis on the impact of integration on government expenditure and my doctoral theses, The Growth and Function of the European Budget was, through international competition, awarded the 6th European Communities Prize in 1971 with 100,000 BFr and the round-theworld trip with my wife!

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EQUILIBRIUM Ultimately, their actions must be measured by how far they create sustainable growth. To some, the relentless recession has left this question unanswerable; to others, it is evidence that they have failed. Either way, their attempts must be measured in the long term, not just in terms of economic returns but in how they maintain an effective regulatory structure, to ensure that growth lasts. A zealous approach to business deregulation risks gutting investor guards in the name of growth, as the US Congress recently did with their attempt to boost job creation through the JOBS Act – a measure even Bloomberg criticized. History has not rewarded conservatives’ faith in the power of deregulation to create growth. Acts to liberalize financial markets in the US at the turn of the century, under the 1999 Gramm-LeachBliley Act and 2000 Commodity Futures Modernization Act,

looked useful in the short-run but were major causes of the financial crisis the Coalition’s efforts are a response too. Similarly, lax regulation in the UK left the country similarly exposed. The Govern-

“attempts must be measured in the long term.”

ment must resist the urge to follow US policies on this front – as the Oscar-winning film maker Charles Ferguson has argued, they

are ‘inexplicably held as a standard’. The government’s attempts to boost lending to business through the Project Merlin agreement, reached with the four major high street banks for 2011, was far from

“While such measures are commendable their scale are limited: just 4,500 individuals were accepted in the NEA’s first nine months.” a clear success. The banks just missed their lending targets to SMEs, but, more importantly, the agreement allowed them to report increases in lending capacity to existing customers as lending to new projects, when they could just increase their customers’ borrowing limits. As Robert Peston noted at the time, the significance of meeting any targets would therefore be ‘hard to gauge’.2 As for the Coalition’s efforts to make it easier to start a business: they are laudable. StartUp, for instance, is a useful attempt at bringing together knowledge and providing help for early-stage start ups. And under the New Enterprise Allowance, a scheme designed to get the long-term unemployed back into work, successful job seekers will receive an allowance, loan and mentoring to start a business. But while such measures are commendable their scale are limited: just 4,500 individuals were accepted in the NEA’s first nine months.

If one was to judge government policy by the number of initiatives launched, it has been comprehensive. No fewer than ten major, focused schemes are in operation, from the Business Angel CoInvestment Fund to the Seed Enterprise Investment Scheme. Nevertheless, in the two years since May-July 2010, employment has risen by just 1.5% and youth employment has fallen by nearly 3%.3 This despite such schemes being accompanied by a marked and consistent fall in corporation tax, from 28% to 23%. Figures from the Bank of England show lending to SMEs has only just began to rise, after falling throughout 2011 despite Project Merlin.4 And since taking office the Coalition have not been able to reduce the cost of credit for SMEs; indeed, for smaller ones it has risen steadily.5 The Coalition’s faith in the private sector’s ability to make up for public sector spending cuts – a key plank of their economic strategy – has yet to be rewarded.

http://ec.europa.eu/enterprise/policies/sme/ facts-figures-analysis/performance-review/ files/supporting-documents/2012/do-smescreate-more-and-better-jobs_en.pdf 2 http://www.bbc.co.uk/news/business-14280628 3 http://www.parliament.uk/briefing-papers/ SN02796 4 http://www.bankofengland.co.uk/publications/Documents/other/monetary/trendsApril12.pdf 5 http://www.parliament.uk/briefing-papers/ 1

SN06056

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How is new media changing the world we live in? By Upasana Bhaumik The following essay was written for Morgan Stanley’s New Media Essay Contest this year, where it was awarded 1st prize

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larm goes off, wake up, find your phone, check your email, log onto Facebook, scroll through your Twitter feed, get out of bed. Coffee break, log onto Facebook, discover a link to a friend’s blog post containing a link to a YouTube video which has become viral. Have a problem, educational, electronic or emotional? Google your way to a forum with posts from people you’ve never met and never will meet, and there you will find your answer. New media is everywhere, and part of every moment. It aims to be available for everyone, regardless of race or religion, country or community. The London riots which occurred in summer 2011 may have been exacerbated through sites such as Facebook. However, the following morning, a community clean up operation had begun – via Twitter. That’s new media, there to connect the new age world, where we all want many of the same things – peace, prosperity, freedom and fun, interpretations of which may vary person to person. New media empowers us, and by doing so, empowers the society we live in. We can use it to create this century’s Gandhi (as man-

aged by the team behind Anna Hazare’s campaign to end corruption in India), and we can use it to criticize the very same movement. For most people, there is nothing stopping us from writing about how we feel about a person, a song or a revolution. Today’s generation feels pressure to sort out the problems in the world, and any way of being able to contribute to the solution makes them feel good. We

with people they would otherwise never be able to talk with. LinkedIn has managed to connect people from villages in opposite parts of the world. Apps on our phone mean that you get updated about current affairs when you want to get updated, not when someone else decides to update you. We are in charge, and we have the power to make a change. We live under the glare of this new media – a

Credit: Tiffany Dawn Nicholson / http://www.flickr.com/photos/tiffanykrumpack/

share pictures, videos and music, anything to make the world a better place. We are becoming nosier, we are becoming closer, we are sharing knowledge at a rate which was once unimaginable.

small blog accusing a multinational company of harming a village has the power to bring down the multinational – all it needs is the will of others using new media to help spread the word.

New media has had an impact on all. Skype has helped many small businesses communicate

The millennial generation is apt at using new media to spread the latest trend, but also surprisingly

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EQUILIBRIUM apt at reminding us about those who do not have the power to communicate with us so directly. Charities have taken new media as a tool to raise awareness about issues which need solving, and in turn the millennials are spreading news of the less fortunate. It is there to inspire the youth of today, to tell them that they can achieve what they want to achieve, regardless of what they may perceive as barriers. It is there to inspire, both a child who has access to the internet for a few minutes a week thanks to an NGO, and a child who spends the majority of their free time on the internet. New media is trying to end the cycle of people doing things because they are the norm – it is trying to get people to take a different approach from their day to day habits. The world has many things which need changing if it is to be a world of equality and tolerance, and spreading the word through as many different means as possible can only be a good thing. New media means that many are fortunate enough to know more than they could ever have hoped for. We spend more time than ever on electronic devices, and it seems that rather than being a curse, this can be a force for good. It is being used to keep the financial markets rolling, it is being used to by governments, religions and foot

ball teams to spread soft power. It is all about power and using it to spread knowledge efficiently and equitably. We are always on our toes – no one knows what the next big story on Facebook will be, no one knows who will be the next Rebecca Black thanks to YouTube and no one knows which campaign will be trending on Twitter. What we do know is that what some-

one sat in Alaska can access, can also be accessed by someone sat in Antwerp who may then spread the message to someone sat in Amman. Globalisation was once about politicians dining, yet now it may well be about an enthusiastic and impressionable twentysomething in Japan finding out about a social enterprise in Ma

lawi through a forum. Thanks to new media, unity has taken on a new meaning. Nobel prize winner Tagore once wrote that his ideal country was one where ‘knowledge was free’ and ‘where the world has not been broken up into fragments by narrow domestic walls’ – nearly a century later, we may have found the easiest way of making his dream come true. Not everyone has to be as innovative as the next, and one person can take a lazier approach than the other, but it boils down to the same thing. They are all using new media to make this new generation of people fit into their idea of what the new world should look like – united. After all, with the great power of new media comes great responsibility. You don’t want to be the only one not participating in what’s ‘trending’.

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Young Rewired State – rise of the young British coder

By Dominic Falcão, Third

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his summer I worked for a social enterprise that helped self-taught programmers under 18 meet other programmers and develop their talents. These kids have built incredible things: a navigation webpage that directs you by major landmarks (rather than by abstract distances and road names which are inevitably obscured by overgrown bushes or have been torn down by bored adolescents). A virtual game of top trumps comparing members of parliament using real, live data. An app that locates all of your friends who have nothing to do within a certain radius and suggests activities that you can do together. These apps are cutting-edge, commercially viable and often fairly polished. They are each created in a week. A single week. By children under 18.

It’s called Young Rewired State and it is incredible and mind-blowing and instils in every aged onlooker the terror of inadequacy. Not only do these programmers come up with these ideas, they actually ex-

“...these kids are incredible, and outpace the majority of tech start-ups in London for agile problemsolving.” ecute them. There are hundreds of kids in this network, and growing, and they are supported by a rapidly burgeoning ecosystem of local businesses and mentors; alumni of the scheme and professionals who are drawn to the awesome spectacle of unbridled imagination creating magnificent things. These kids are incredible, and outpace

Year PPE student, Unive rsity

of York

the majority of tech start-ups in London for agile problem-solving. How does it work? Several hundred young people scattered across the country are challenged to build digital products for mobile and web, using at least one piece of open data. They go to “centres”, spaces with WiFi and the necessary equipment, along with YRS mentors and alumni and start building. These centres each host a team for a week and help stimulate the ideation and creation processes, sharing their expertise and guidance. On the Friday of the week everyone heads towards a single location in the UK for the climax of the week. The “Festival of Code”, the presentations in front of a panel of esteemed judges and the

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EQUILIBRIUM awarding of prizes. The festival involves food, drink and speeches from thought-leaders before some of the YRSers go to sleep and others spend the night finishing their projects. Prizes are awarded after two rounds of presentations and have included such mischievous categories such as “most likely to annoy a government official” as well as “code a better country” and “best in show”. Why YRS? Here is some background. The UK struggles to remain competitive in the modern globalised economy: manufacture is cheaper in developing countries and technology is done more effectively in others who have already begun to specialise. Sweden is green. Germany is automobile. The US is aerospace, Web 2.0. South Korea is mobile telecoms and shipping. India and China are engineering, manufacturing in general and are becoming developer hubs too. The UK is a service economy with a dwindling number of services over which it can offer a competitive edge. One day we will finally admit that, but for global warming’s prospects of turning the so-called “Devonshire Riviera” into a quasi-Mediterranean paradise, we have few reasons to bet on our tourist industry as

“The UK is a service economy with a dwindling number of services over which it can offer a competitive edge.” the future saviour of the British economy.

It seems obvious that changing the way we think about innovation is a crucial part of addressing this issue: innovation accounted for 63%

State funding) was on ICT, twice as much as any other industrial sector.2

of economic growth between 2000 and 20081. Thus, with arguably the best higher education system in the world, it should be concerning learning to read Nesta’s report:

And whilst organisations such as the Royal Society, individuals such as Eric Schmidt and David Cameron, have remarked upon the inadequacy of the status quo in education, it is often young people who are able to put the point most succinctly:

“Investment in innovation by UK businesses started slowing in 2000, and decreased slowly but steadily as a percentage of output all through the last decade. Fixed asset investment was increasingly dominated by bricks and mortar, with less and less being invested in high tech kit”. Certainly, one of the clearest bottlenecks for making the UK a prime destination for innovative business, and one of the most commented issues, has been the total under-provision and irrelevance of computing education in the UK, despite the fact that computing has, by all accounts, become a truly integral part of innovation. 25% of all EU business R&D spend in 2007 (excluding

[we can encourage more kids to start coding by] “Scrapping the secretary-training ICT curriculum, replacing it with one which teaches more about how technologies work and how to manipulate them.” (Young Rewired State attendee, 2012) It is already too late for many students whose lives will rely on and revolve around these technologies. This skills deficit holds up the entire system. At the level of computing, the NextGen, Royal Society and BCS reports made it clear that computing must become part of the national curriculum. Thankfully, this 23

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EQUILIBRIUM is underway following the Ofsted report on ICT, 2011, the scrapping of ICT as a compulsory subject from 2014 and the recognition by Michael Gove that: “Computer Science is a rigorous, fascinating and intellectually challenging subject... and is merging with other scientific fields into new hybrid research subjects like computational biology... We will certainly consider including Computer Science as an option in the English Baccalaureate3” As a lean, intermediate alternative, the model demonstrated by Young Rewired State is to employ grass-roots virality that can spread from the existing kernel of people who are passionate about their skill and counteract the decline in

interest in programming that occurs because of the existing lack of support in schools. Yet, one of the biggest problems for developing a competent and vibrant population of programmers and developers in the UK is the false and anachronistic dichotomy between “ideas” and “execution” that seems to be at the forefront of both business and government mentality in the UK. The discordant reality is that virtually all new businesses are unequivocally dependent on developers to progress from the idea stage. Developers tell them what is possible and impossible, what are efficient and inefficient solutions: the very boundaries and details of the fuzzy blueprint that entrepreneurs lay upon their tables.

What YRS shows, through the hundreds of unique prototypes it creates every year is that developers themselves, given space and equipment can squash that dichotomy: they are problem-oriented, design-thinkers, capable of taking embryonic ideation to rapid, lean execution in weeks, rather than months. Proper investment in this talent sector would very clearly be a more fertile destination for investment in terms of UK innovative production and growth: YRS is solid and unquestionable evidence of this. http://www.nesta.org.uk/areas_of_work/ economic_growth/assets/features/plan_i 2 http://www.computingatschool.org.uk/data/ uploads/BCS_Computing_Fact_Sheet.pdf 1

3

Michael Gove’s speech at BETT January 2012

Interview with Chris Etheridge C

hris Etheridge studied an undergraduate degree and masters in Politics at the University of York, founded his first company whilst at the university and is working on his second. His first company, Yatterbox co-founded with University of York student Matthew Freckelton, provides a unique digital monitoring platform that tracks all UK politicians, across every social network, in realtime. His second, a social network called Flairshare, is a community in which university students showcase their talents and compete with others.

How did it all start? I accidentally fell into being an entrepreneur; it wasn’t something I was consciously going to do at all. I think I was about 14 when I decided I was going to do a Politics degree, and it was always going to be York. I didn’t actually look around the university before I went to York: I literally just decided I was going there and that was it. I knew it had a good Politics course and I knew York was a lovely place. So I decided I was going there, doing Politics, and I knew this before I even started my GCSEs. I have always been

Chris Etheridge

very focused and known what I was doing and where I was going. And then, I got to York, started enjoying the course, got involved in everything, student union, the Conservative Party, Politics Society (I helped set it up!) It was really in third year when I ran for a sabbatical YUSU position when I bumped into Matt Freckelton that things really kicked off. We

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EQUILIBRIUM were talking about the general election and we realised that you couldn’t follow politics all in one place online; you’d have to have loads and loads of tabs open: even Twitter doesn’t allow this because you have to identify all politicians you are interested in before you can actually put them in a feed.

clear sense of direction in the past, that I knew I wanted to go into Politics that put me in touch with a lot of useful people and made everything possible.

You have to make an effort to get in touch with the people who will be useful to you straightaway – if you do that, people will remember you and you will get things done.

How do you go about building that network?

Are you never worried that people will steal your ideas?

It’s easy to explain. There are certain websites that you should join if you are an entrepreneur or someone with that mindset. One is called Meetup.com; a website which sends you drinking and linking events in London, it set you up with event after event

Many people fear this, but there are many barriers to pinching ideas: one is, no matter how clearly someone explains something in words, if you haven’t got a paper copy of a proposal or plan, you are unlikely to interpret the proposal in the same way. But also,

“It’s not about what skills you have, it’s about whether you can get people to do something with you.”

with likeminded people. You sort of bump into people and things happen. It’s really about opening yourself up to as many possibilities as possible. The young institute of Directors is another website that will fire things at you.

able to get people to invest in it. But it really is just that I had made the contacts in previous years. Perhaps it was partly down to my

If you do go to these events and meet people, you need to send follow up emails pretty much 24 hours after you meet them, latest.

you’ll get more out of networking if you tell people about your idea. For example, by networking I have met all the people who have helped me build this site – if I hadn’t, I’d be stuck on my own. If you don’t take that risk; you won’t get anywhere. Entrepreneurs are gamblers.

So we got a ltd company started, got funding and got this thing built. So it was all an accident, I was planning on going into a research position when I met Matt and changed direction. Can you highlight anything as the most important part of the process that lead up to the founding of Yatterbox? It’s down to networking. I know an awful lot of people just through campaigning. If you want to get something done it’s really down to who you know. It’s not about what skills you have, it’s about whether you can get people to do something with you. It’s a placefilling thing; you just have to find the right team to fill all the places. I’m not a programmer, I can’t code websites, but I was able to find people who could. As a business, Facebook was very unusual in that Zuckerberg was able to code and

How did you identify that Yatterbox was going to make money? 25

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EQUILIBRIUM The thing about Yatterbox is that it wasn’t originally a sound financial idea. It was an idea that we liked. I mean, Yatterbox originally was about putting the public in touch with politicians. Eventually, we moved from providing a service to the public towards providing a service for companies: we’ve built a “back-end” data analytics system and are trying to solve the “big data problem”. What we mean is that we collect about 5,000 updates a day and have stored about 2m. That data is no use to people,

Most people think that without clear revenue streams it will be impossible to attract funding. I disagree. Many businesses come about from simply being good ideas that are then adjusted for commercial purposes. Facebook is

“...you’ll get more out of networking if you tell people about your idea.” a good example – it was just a cool idea in the first place. It’s when you’ve got a good idea, enthusiasm and can put the right team together that investors get impressed. When an investor sees a really capable team and a good product, even if it’s not commercially viable, if it’s solving a problem then you can usually do something to make money with that idea. Furthermore, once you’ve built things you often learn much more about them, especially when you see how users interact with it and get feedback. Tell us about Flairshare

A year of social media usage by UK Politicians over the course of 2012. This has been compiled by Yatterbox in partnership with the Policy Exchange for the 2012 UK Political Party Conference Season.

they don’t have time to look at it, but it becomes useful if you are able to build tools which make it possible to understand interesting things from that data: this is the “back-end” of our system. That’s where the revenue stream is. Without a commercial idea in the first place, how did you get funding?

It began when I was analysing social networking sites and trying to work out why they are popular. I realised that Facebook has solved the problem of “I want to keep in touch with my friends” very well. Yet both its strength and its weakness is this focus on the immediate friends network; what it doesn’t give you is an organised format to show off what you are good at to other people who are interested in the same things. Yes you’ve got groups, but the feeds are organised so that once something leaves the

live feed you lose it and never see it again. Part of this is that you might want to compete: Facebook doesn’t allow you to compete. It doesn’t tell you how good you are in comparison to other people, which is useful particularly in the job market, where graduates are looking to stand out. For example, if I am an artist, I upload art to the Flairshare website,

“It’s when you’ve got a good idea, enthusiasm and can put the right team together that investors get impressed.” tag it as artwork, and allow everyone with this interest to quickly find it and rate it. Flairshare will then work out how many points I have versus other artists, and how many points the University of York gets for my contribution to

art. The end result will be guardian style rankings which show everyone how the University of York stands for art and where I stand as an artist versus every other student.

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The York Entrepreneurs Society and why you should join W

hat is an entrepreneur? Most definitions you’ll find simplify to this: someone who takes risks, financial and otherwise, to operate a business or businesses with the aim of profit and reward. There’s one crucial word there: risk. An entrepreneur dares to try, sees failures as mere obstacles and often has an unrivalled ambition to succeed. So, have you got what it takes?

challenging tasks over a week to win a substantial prize pot- £1500 in 2012. The event has become a key one for YES as it fits nicely with the society’s aims of allowing students to gain enterprise-relevant skills through doing. In 2012, teams had the opportunity to get a guided tour around Leeds Brewery, led by co-founder Sam Moss.

developed a whole host of careerrelevant skills. Sam benefited toothanking the participants, he said jokingly: ‘I’m just going to steal all these brilliant ideas now and make use of them without paying you a penny!’

We challenged them to create a detailed marketing strategy for the Brewery’s newly released lager; Leodis, which they presented to a panel, surviving probing questions and a grilling from Sam himself before a winner was announced. The students involved got a lot out of the experience- they met a young, ambitious business owner, whom they were able to remain in contact with after the event, and

some of the most talented, ambitious and interesting individuals studying at York; creating an environment in which they can quickly learn from one another. Within the committee alone, was the founder of a now-flourishing orphanage in Uganda, someone who started an adaptation of Ebay that helps Africans purchase goods online - (he also had a spell working for the Bank of England)

YES is a fantastic society to be involved in because it attracts

Join The York Entrepreneurs Society (YES) and find out. Since its inception, YES has helped students to meet entrepreneurs and business owners, to learn about how to run a business and motivate them to act on achieving their goals. The Society achieves this through events, challenges and talks, to foster and inspire entrepreneurial spirit amongst students

“The annual York Apprentice event sees teams of students compete in a variety of challenging tasks over a week to win a substantial prize pot- £1500 in 2012.” at York. The most notable of these has been the annual York Apprentice event, which sees teams of students compete in a variety of

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EQUILIBRIUM - and an Olympic torch bearer. We also had a Freemasons applicant! However, that’s not to say that you need to have done anything spectacular to join YES- all you need

“YES also tries to build links with the local community, giving members an opportunity to gain experience working with young people.” is an interest for enterprise! You’ll meet students with a whole host of interests, allowing you to share ideas, organise events, develop skills and open up future opportunities for yourself. Connecting you with the right people is a key benefit of the Society. For example, last year one of our members was looking to start an online business based around helping students to use their time effectively, but could not find a web developer. However, after talking to a few YES members he managed to meet a student who ran his own programming business in his home country. They consequently started working together on the project. Similarly, Matt Freckleton, who used to be involved in the society, has at least

one current YES member working for his start-up Yatterbox, which is based on Heslington East. In 2011/12, YES is going to host termly individual Apprentice events, in which students will compete in challenges, based around a specific company, with the winner securing work experience with that firm. This will provide some great opportunities for enhancing students’ CVs. The Society will hold regular opportunities for members to meet up, discuss ideas and get advice about businesses they’ve started or are looking to start. We are in talks with various companies about running workshops on campus for YES members, allowing them to learn about a specific enterpriserelated topic, such as finance, tax or marketing. YES also tries to build links with the local community, giving members an opportunity to gain experience working with young people. In 2011, the Society helped to set up an enterprise day for local primary school children at The Ron Cooke Hub on Heslington East. The day involved year five pupils from a range of schools working in teams designing a new chocolate bar. Tasks ranged from prod-

uct design, marketing, finance and presentation skills. Similar events for 500 pupils were hosted in 2012 in partnership with Tadcaster Grammar School and the University of York’s Student Recruitment and Admissions Department. YES will give you the opportunity to meet like-minded and interesting students and entrepreneurs, develop your own ideas about starting and running a business and provide you with the chance to enhance your CV through participation in the challenges we

hold throughout the year. For anyone who is not currently on our mailing list, please get in touch with us at entrepreneurs@yusu. org. Similarly, if you are involved with a society and you think we should work together, let us know. Email us with ideas and questions too and we’ll do our best to help you however we can. We’re determined to make 2012/13 the best year for the Society yet, so watch this space!

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eorge Hudson, a University of York student, initially founded the society in 2004 with the intention of generating profit from the enterprise. George attempted a number of ambitious schemes whilst at university, one of which was a major festival in the city. When a dose of bad luck rained off the event, he was left to foot the huge bill for all the acts that had arrived. George’s activities with the society taught him a great deal about risk and reward. He secured a place on the prestigious Global Scholars Program in America where he worked with successful entrepreneurs. He was only taken seriously as a businessman when they found out about his festival mishap: failures define an entrepreneur and are an integral part of success. (George has gone on to set up and run a successful media company, GH Media.)

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The BRIC wall By Samuel Yates

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eform is needed for emerging economies to pursue trend growth. Year on year Chinese GDP growth was in double figures, now only managing 7.8% in the second quarter of this year. The IMF in a recent report questioned the sustainability of the growth, stating the last decade may have “generated overly optimistic expectations about potential growth” of emerging economies. Catching the cold Much of this speculation has been aimed at the exhaustion of a boom in the commodity market. ‘Natural resource industries, account for around 41% of the market capitalisation of the BRIC’s’. But the BRIC wall seems to be crumbling under the unstable foundation of a diminishing Chinese appetite for

“... emerging economies have been showing disdain at the lack of competence of European decision makers.” raw materials. This is particularly worrying as Russia relies heavily on its export industry of oil and gas to the 1.34 billion strong population of China. This fall in demand is in part explained by the manufacturing slump experi-

enced by the Chinese exposure to the Euro crisis and consequently a corresponding fall in exports. As such, emerging economies have been showing disdain at the lack of competence of European decision makers. The latter have reacted by suggesting that it is the responsibility of other countries to supply funds to the IMF in order to bolster resources available to Europe. There are arguments two folded. But the old saying ‘the Eurozone sneezes, the whole world catches a cold’ chillingly reverberates down the spine of Chinese export led growth. The race for Economic prosperity is becoming more of an obstacle course than a sprint for policymakers. The Eurozone crisis has knocked demand for Chinese goods meaning there is no longer such an appetite for raw materials. With the Russian reliance on gas and oil exports to China, it seems they will be belligerently punished if diversification isn’t prioritised. But the approach to policy change is unrelentingly prosaic. It isn’t only oil dependence threatening Russia’s structural stability. Russian farmers already owe 1.2 trillion Rubles in terms of government subsidies, yet the Kremlin

over the last two years has vowed to prop up a shortfall in profits totaling an estimated 17.2 billion Rubles. Whilst the finance minister of India, Pranab Mukherjee, has failed to reduce fuel subsides that cost the economy 0.8% of GDP. Not only does this distort the incentive to diversify the economy, it also adds to the pressures of the 9% deficit of GDP overshadowing the economy. It is not only failing policy change within the borders of these countries that is putting pressure growth prospects. It seems that in tough times of high unemployment and low growth, increased protectionism is threatening the sovereignty of Chinese exports. With an election looming on the horizon, The Mellman Group, a democratic polling organization have released a survey showing

that 62% of Americans want to get tougher with China. This sentiment of the economy has been 29

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EQUILIBRIUM encapsulated within a microcosm of this summer’s Olympic games. Revelations that American athletes were wearing Chinese made Ralph Lauren uniforms caused further anger among domestic manufacturers. This is nothing new; the US had bitterly opposed attempts of China to keep the Yuan artificially low for many years. Though this little flame has reignited as the appreciation of the yuan has stalled and reversed a little in 2012. The problems go even deeper into the structural layout of China as they were left with two major hangovers from the commodity binge. Local government debt of 10.7 trillion Yuan and a fall of 2% in house prices. Recently both have been on the rise. Indicating that the economy has responded well to the stimulus measures taken by the government. Despite a growing level of debt, reports suggest banking regulators have increased lending to ‘better qualified’ financial vehicles. These shockwaves from a slump in creditworthiness of banks has been global. The most recognised ones being the Frank Dodd act past by Obama in the States and the recent fines levied on Barclays for manipulating the LIBOR rate. It is therefore questionable whether China itself is making impressive headway in policy change. We still do not know in the long run whether the increased regulation of finance is a desirable. The Frank Dodd act in America has come under heavy criticism from Economists and small businesses alike, with many taking out court injunctions to overhaul the countless number regulations

outlined by the 324 pages strong act. Suggesting that the confining parameters of risk are depressing investment.

to diversify.

What is the future?

The future may still be rosy, in 2002 as now; many predicted growth to curtail off with Chinese government debt was unsustainably high. Yet they experienced the most rapid growth of all time in GDP of any major economy. It may be that the recent blip in growth is just that, with the service sector maintaining healthy growth. The PMI (purchasing managers’ index) rose from 52.3 to 53.1. This is an optimistic outlook for China’s maturing economy and in the end the economy is still growing faster than it was in 2003. However, structural change is necessary is the BRIC’s want to escape the wrath of the boombust demand cycle in the Western World.

Therefore it seems that both a cyclical and structural downturn is being experienced in the emerging markets. To combat the cyclical downturn, many of these emerging economies have much higher interest rates in the region of 6 to 8% compared to near zero in developed economies. This gives scope to employ monetary stimulus measures to rejuvenate domestic demand. Furthermore, to prevent the downturn form being as painful, it may take more extreme measures such as providing more funding to the IMF to help the bailouts of Europe and encourage China to sacrifice their undervalued Yuan. However the reliance on commodities identifies structural problems. As China experiences a slowdown, the other emerging economies relying on Chinese commodity demand need

A gem cannot be polished without friction

Focus Box • BRIC is a grouping acronym that refers to the countries of Brazil, Russia, India and China, which are all deemed to be at a similar stage of newly advanced economic development. • The acronym has come into widespread use as a symbol of the shift in global economic power away from the developed G7 economies towards the developing world. • It is estimated that BRIC economies will overtake G7 economies by 2027. • The pre-eminence of China and India as major manufacturing countries with unrealised potential has been widely recognised, but some commentators state that China’s and Russia’s large-scale disregard for human rights and democracy could be a problem in the future. • A criticism is that the BRIC projections are based on the assumptions that resources are limitless and endlessly available when needed. In reality, many important resources currently necessary to sustain economic growth might soon experience a peak in production before enough renewable energy can be developed and commercialized. The economic emergence of the BRICs will have unpredictable consequences for the global environment.

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How Enternships Make Students Happy and Save the Economy By Andreea Magdalina, Content & Community Manager at www.enternships.com

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nemployment soars. Recession. Immigration. It’s today’s doom and gloom. And, surely, it’s scary. What would you say if I told you this is in fact good news? That in spite of all the cuts, redundancies and fund drops the economy is actually taking a step forward. Intrigued? Let me explain.

States, and one of the most successful too. Closer to our times, this Harvard drop-out used to work as an office boy before setting up Microsoft and becoming one of the world’s richest according to Forbes magazine. Nice one, Bill Gates.

Be kind. Rewind.

Lesson number one? Never give up.

‘How can recession be a good thing?!’ you must be thinking. Well, let’s see if any of these stories sounds familiar. Around 130 years ago a little boy diagnosed with

While there is no set formula for success, one idea seems to catch the eye: it can happen to anyone, anywhere, anytime. And if this was tougher in the past, because

autism was having problems getting his lessons done for school. A few decades later he wins a Nobel Prize in Physics for his discovery of the relativity theory. It took 30 years of failed political attempts for Abraham Lincoln to become president of the United

of the various socio-political and geographical circumstances of the time, there are no barriers now. Internet makes everything possible. YOU can have your breakthrough at any point by either sharing a photo on Facebook,

a video on Youtube or by posting a comment on Quora. Or by launching the next platform that lets you do all that in one place. Possibilities are endless. Now back to business. What does this have to do with enternships? Bear with me one more line. Due to all obstacles that have been removed thanks to new technologies, particularly those related to location, time and cost, more and more people have the opportunity to set up their own independent business and do the work that they love [and love the work that they do]. Which in turn means more diversity in products and services on a hyper local level, but on a national and international one as well – since geographical barriers have been torn down. Which also means, thousands of ideas elaborated into business concepts, thousands of concentrated mini-projects being developed by people like me and you, and not a fancy suit. Small businesses drive innovation forward because they allow for a transparent ideation flow, as well 31

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as speed in putting all those ideas into practice. Steven Johnson’s idea of ‘liquid networks’ is particularly valid in the case of startups and SMEs precisely because they let people communicate with each other effectively and creatively which in turn leads to good ideas getting pushed forward. So what’s the point? Small companies can’t afford big business centres so they nest in the creative neighbourhoods of a city. Far away from the two piece suits or 10-floor glass windows, they either sit in incubators or partner with other startups and rent a house together [like we did]. We are all aware of the impact the working environment has on our levels of productivity so what can be better than sitting with fellow creative minds and

discuss tech/Facebook/life over a cup of tea? Despite a lack of resources, it is also easier for small companies to make hires, particularly temp hires. Where they might lack in capital, time and staff they compensate with flexibility, speed and openness to the new. Sounds like the perfect place for a student, right? That’s because it is. And now the whole hiring process is made easy too. Internships allow employers to test different types of employees before committing to something more full-time, as well as take on graduate talent and train it from the start. In return, young people get hands-on work experience that gives them a real taster into the world of employment.

If the past saw SMEs in a rough spot when recruiting fresh talent, now it’s much easier for them to connect with each other using social media and websites like Enternships. The benefits go both ways: 1. Students and graduates get their hands [and heads] deep into real work experience that shows them first-hand what running a business is like and get an opportunity to add work in their portfolio under a company’s signature; 2. Companies boost their manpower with young and energetic people who are willing to give all their input and make a difference while also learning new skills. A third beneficiary should be added and this is where we make all the difference: the economy. Healthy business gets ahead, jobs are being created [85% of them to be precise], students get their valuable work experience, and great products and services are being sold. At the end of the day, the economy wins. The world wins. Enternships is a platform that connects ambitious, entrepreneurial students and graduates with innovative companies.

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Equilibrium #4: Enterprise and Entrepreneurship