ENTREPRENEURSHIP
SERIAL ENTREPRENEURS The key to the success of the UK economy
W
ith the rise of crowd funding, tech start-ups and the popularity of TV programmes like Dragon’s Den, there has been a lot written about small businesses and first-time entrepreneurs. However, there is little discussion or research into the rising phenomenon of serial entrepreneurship, where entrepreneurs don’t just cash in on their first business and hang up their boots. The respected private bank and wealth manager, Coutts, sees serial entrepreneurship as a key to the success of the UK economy. Against this backdrop, Coutts and the Centre for Entrepreneurs have published a report entitled ‘Beyond the first business: the myths, risks and rewards of being a serial entrepreneur.’ The report surveyed 135 UKbased entrepreneurs to provide an overview of the depth and extent of serial entrepreneurship in the UK. Alex Liddle, Coutts Executive Director, South East England, commented in the findings: “Millennials are widely challenging the notion that entrepreneurs hang up their boots and retire after just one business. Entrepreneurs are starting businesses younger and have faster expectations to sell. These factors, together with longer life expectancy, mean we are starting to see a new breed of serial entrepreneurs. Instead of starting businesses from scratch, more of these seasoned business owners are now investing in and mentoring a portfolio of companies. There is huge untapped potential for serial
10
“Serial entrepreneurs are less afraid of failure, with only 13% saying they experienced this fear.”
entrepreneurship, and the role of experience seems invaluable to success. Unlocking that further could provide significant economic benefits.” The research found that there are two main factors driving the rise in serial entrepreneurs: First, entrepreneurs are starting businesses younger: more than half (57%) started their first business by the age of 25 versus only 23% of those aged 35 and above. This group also had expectations of selling faster, with 63% of our younger respondents planning to exit their current business within the next five years, versus 46% of those 35 and over. Second, longer life expectancy and a lowinterest-rate environment means there is greater appetite among one-time founders to put their capital to work. They are looking to recreate the buzz of working in a fast-growing business, but, by their very nature, they are unlikely to want to work for someone else, and in many cases the thought of starting another
business from scratch is too much. So they are looking to take more of a hands-off approach across a number of companies. The attitude of serial entrepreneurs to actually running a business is also a key differentiator, with only 55% saying they enjoy this, versus 80% of one-time founders. Serial entrepreneurs are less likely to enjoy day-to-day business involvement. Instead, an increasing number of these seasoned business owners is considering other options, including mentoring a portfolio of companies, being nonexecutive directors or being angel investors. Perhaps unsurprisingly, responses from serial entrepreneurs suggested they are less afraid of failure, with only 13% saying they experienced this fear, compared to 40% of one-time founders. While 67% of one-time founders acknowledged good fortune as a contributor to their success, only 56% of two-to five-time founders and 36% of Alex Liddle, Executive Director, Coutts