The diversity in economy of London is possibly one reason for what appears to be a positive trend , but once we go deeper removing the fancy outer layers, the hard work and the struggles faced by SMEs are often conveniently ignored. To become a successful business, you will have to be the best in your sector and you will certainly need to innovate in order to succeed. In a recent time frame, there will be multiple entrepreneurs all coming up with similar ideas. According to reports1, 672,890 new companies were founded in UK in 20222 – on average approximately 1800+ startups every day.   Most startups need funding, and perhaps most importantly, most startups need educating how to seek and successfully attract funding.

In order to strive for financial success and establish a better business, one has to add more values and innovation into their business model, product or service. The best part is, the greatest success could come from a simple decent idea with a value proposition of solving the day to day needs and wants of common people as well as a roadmap to solve the problems of the future.

One thing that every startup finds difficult is knowing when to ask for help or from where to get support for their business. Their growth depends on how they tackle hurdles and barriers in order to move forward. The Business Investment Accelerator (‘BIA’) programme is designed especially for entrepreneurs and startups and delivered by experts.  It a great place to start learning about how to achieve investment.  The BIA Programme from Co-Innovate is an SME support programme, funded by the European Regional Development Fund and delivered by Brunel University London.  The BIA is a 5-day programme of business support, training and mentoring delivered by Co-Innovate in partnership with NatWest Business, The Business BoardRoom, and Brunel Business School.

The programme also helps entrepreneurs to learn how to find out the right investor for their business, opportunity to pitch their business to potential investors at the final day and a chance to win 12 months of strategic business mentoring worth £12,000.               

Finding the right type of investment is a key to your business’s growth and success. There are a number of types of investments that include Bootstrapping, Business loans, Angel investors, Venture capitals, Crowdfunding etc.

Bootstrapping is the term for using personal money to start and grow a business. In this method, business owners invest their own money rather than relying on outside investment that could dilute their shares in the company. This gives full control over the shares in the company but at the same time there is a risk factor of losing your own money if the business fails.

In the UK, there are more than 5.7 million SME businesses3. They are the driving force behind innovation, higher productivity, problem-solving, and job creation, thereby acting as the backbone of our economy. For this reason, the UK government encourages the growth of small businesses – with the support of various programmes such as BIA. Another tool is small business loans. The major benefit of a business loan is that the investment does not take shares in the company and they do not mandate exactly how the loan is spent in your business. On the other side, with loans, the financial risk is high as loans must be paid off, even if your growth strategy does not succeed.

Angel investment is another type of investment opportunity for SMEs where a private investor/seed investor provides financial backup for you mostly in return for equity ownership. Other than financial support, they usually enable you to take the initial steps in the startup stage by using their experience and networks. A great advantage of getting an angel investor is, they often don’t require repayment if your startup fails, which means less financial risk for the entrepreneur.  There are also tax incentives for the investor.  The downside is that since they invest the majority of the amount, they have more control in decision making.

Venture capital is a type of investment where a group of professional investors invest in startups or different stages of business growth. They invest large sums of money in return for equity ownerships. Once they invest in your business, they take responsibility in building your business and make sure they get the maximum return.

Crowdfunding is a relatively new idea in investments, where a company creates an online campaign to take donations from individuals in return for discounts or products, based on how much money they donated. A successful crowdfunding marketing campaign could get you a good amount of money to start a new business or develop a new product.

Naima Omasta-Milsom, Co-Innovate Innovation Director says: “It’s a tough environment for small business owners, especially when it comes to finding the funds to grow. That’s why Co-Innovate has joined forces with leaders in the field who can build the knowledge and capacity of London’s owner managers to have the right approach to investment.”

Innovation in 2023

The team at Co-Innovate is at the forefront of entrepreneurship research and has determined the below top trends that you need to keep an eye on while you make strategic business decisions for 2023.

Trend #1. Environmental and Social Governance (ESG)

How you operate your business has a huge impact on your customer’s perception towards your brand identity. These days, brands need to prove their ethical credentials, not just talk about them. In an era of information at your fingertips, people can determine whether what you are communicating is aligned with what you actually do. However, building trust is really important at a time when many consumers are exposed to the latest marketing buzzwords such as ‘green’, ‘bio’, ‘sustainable’, ‘ethical’ etc. by brands to hype their environmental and social credentials. People want to do business with brands that share similar values. Focusing on your ESG strategy will help you show everyone, from investors to customers, why they should choose you as a trusted green business.

From an investor viewpoint, your ESG strategy shows how you’re reducing risks and embracing new opportunities for growth. For example, how you plan to meet future environmental legislation. As a small business you can make a big difference, especially in your local community. There are many government-backed support schemes available for small businesses which could help you with ESG areas such as reducing your carbon footprint and ethical leadership.

The story of Co-Innovate alumni SME ‘Recyrcle’ is an example. As the world is looking towards a circular economy, their idea was to create a circular economy system for waste disposal and its reprocessing resulting in cutting down almost 90% greenhouse gas emissions from material extraction and production process, which accounts to 65% of greenhouse gas emissions around the globe. The idea of Recyrcle is based on UN Sustainable Development Goals – ‘’Shared blueprint for peace and prosperity’’.

Samreen Nurullah credits Brunel Co-Innovate for starting her on a business journey. Someone stepped in to say that the university could help if anyone wanted to explore their own business idea. That was her first encounter with the Co-Innovate programme.  She met her co-founder through Brunel, and some of their team members are from the university.  In 2020, Samreen applied to the Co-Innovate Bridging the Gap programme. The workshops and 1-2-1 sessions were a big help.   ReCyrcle has also launched a community-led project in Newham called Recycle Dock which is a circular makerspace that delivers community workshops to enable sustainable creativity and improve local recycling rates in Newham. The project has been supported by the Create Your Docks Fund- Royal Docks, Newham Council, the Greater London Authority, and the Mayor of London. 

Trend #2. Founder-led brands

Sometimes, founders become the biggest asset of their business (think Elon Musk and Steve Jobs). Many investors are drawn to founder-led companies because of their expertise, leadership, and long-term vision. As a small business founder, you’ve put a huge amount of time, experience, hard work and money into your company. You may also have started your business as a passion project, or to solve an issue in your sector, giving you a clear purpose and vision, and the determination to get there.

As a founder, you can embody your brand and act as an influencer to show how your business is unique and purpose-led. One of the ways you can do this is through founder-led marketing. People trust brands which have a persona and especially if there is a trustworthy person involved who they can emotionally associate with. From sharing your story and mission as a founder, to leveraging your expertise and becoming a thought leader in your sector, using platforms like social media and podcasts are all great ways of communicating to your target audience and ensuring your brand receives positive media coverage.