Eight out of 10 ideas for a business or invention never see the light of day
02/01/2007
"We simply cannot afford to be complacent and rely on yesterday's solutions."
NESTA, the UK's largest early stage investor in innovative and creative businesses, commissioned research to find out why so few of our 'good ideas' make their way to the balance sheet.
The 'Fear of Failure Report' released by NESTA, reveals that nearly one in three (29%) people have had what they thought was a great business idea or invention but eight out of 10 of those didn't do a thing about it. When asked why, 61% said that they didn't know where to start, 67% claimed not to have sufficient funds and 33% just didn't have the time. But there were other worries too that were stopping those good ideas coming to life.
Going bust
One out of six were worried about losing their home if their business failed and 6% said that the stigma of going bankrupt was affecting their decision not to act on their idea. The research reveals that almost three quarters (74%) said that the fear of bankruptcy was a factor in not going it alone.
The real risks
In the UK, the number of company liquidations decreased in the third quarter of 2006, and estimates show that 110,300 new businesses started up in the first quarter of 2006, almost one quarter more than in the same period last year (88,000). It was the second strongest first quarter on record since Barclays started tracking the market in 1988*. However, it's not all good news; on the global stage we are lagging behind the US and Canada when it comes to embracing innovation and an entrepreneurial spirit.
Jonathan Kestenbaum, NESTA CEO, comments: "The UK's competitive advantage will be directly linked to our capacity for innovation. We simply cannot afford to be complacent and rely on yesterday's solutions. The competition is fierce and we must mobilise business, education and policy around a relentless focus on innovation".
For further information, please contact Proof PR on 020 7713 1222 (out of office hours 07966 541 810) or email sue@proofpr.co.uk
The survey was commissioned by NESTA and conducted by YouGov between 15 and 18 December 2006, interviewing 2083 people.
About NESTA
NESTA is the National Endowment for Science, Technology and the Arts. With endowed funds of over £300m, NESTA is the UK's largest early stage investor in innovative and creative businesses.
UK statistics - start-up stats
- An individual entrepreneur requires on average £13,000 in start-up finance at the very earliest stages of its business development and is prepared to invest around £9,000 of his or her own money to begin the process.
- To fund this (equity) gap the most popular source of external finance for both men and women is a bank overdraft, men 32.5% and women 23.5%.
- 9.5% of women report the use of government grants compared to 8% of men. 3.6 % of men and women were unsuccessful in their attempt to secure a government grant.
- 15.9% of women and 17.4% of men use their credit cards to finance their business.
SOURCE: Global Entrepreneurship Monitor - UK 2005