Advances in ICT coupled with flexible workforces and new networked corporate ecosystems are creating opportunities for startups across the UK and Europe. The opportunities for SMEs to establish themselves, compete, and scale have never been better. The key is to understand the developments underway and to be able to exploit them.

Adopting an open talent approach is good for startups

From a startup perspective, remote and flexible work can increase efficiencies and reduce costs, while creating more opportunities for individuals. The COVID-19 pandemic was the catalyst for the mass adoption of remote working and a move towards open talent models as people became comfortable with the technology, applications and digital tools available.

The crisis forced many companies to rapidly adopt remote work arrangements to comply with social distancing measures and ensure employee safety. This led to a widespread acceptance of remote work as a viable alternative to traditional office-based employment and has stayed even though the pandemic has gone, and some executives have called for a return to the office. Tesla, Amazon, and Disney represent a few high-profile examples. Yet this approach is wrong-headed, and startups should not follow the wrong approach adopted by Elon Musk and others who should know better. Data shows that return to office decrees can increase office attendance by as much as 14% but push employee engagement scores down by 26%.

Top talent is demanding flexibility and a work-life balance, and if larger companies are not going to facilitate this then it represents a fantastic opportunity for startups to attract top talent. Organisations are continually grappling with the scarcity of skilled professionals to meet their evolving needs, especially in the technology sector. This problem is set to worsen with recent European studies showing that only 12 million skilled professionals may be available by the end of this decade, despite EU targets of employing 20 million ICT specialists by 2030.

A new ecosystem that benefits startups

Increasingly the new world of work is offering up a symbiotic relationship between large and small organisations. The future of work is creating more opportunities for small and agile companies with specific skills and expertise that can fit into a new, more networked ecosystem.

The Whale and Plankton Ecosystem of Mutual Enforcement – as coined by author and futurist Rishad Tobaccowala – is a metaphor used in the context of business ecosystems to describe the interdependence of large companies (whales) and smaller, innovative startups (plankton).

Whales represent large, established companies with significant resources, market presence, and customer bases. These companies often have established products or services, extensive distribution channels, and strong brand recognition. In the ecosystem metaphor, whales provide stability, scale, and resources to the ecosystem.

At the same time, plankton symbolise smaller, agile startups or innovative companies that operate within the same ecosystem. These companies are often characterised by their innovation, flexibility, and ability to disrupt traditional markets. In the ecosystem metaphor, plankton contribute to the diversity, innovation, and dynamism of the ecosystem. They are often a resource for the larger organisation to utilise too.

The concept of mutual enforcement refers to the idea that both whales and plankton benefit. Whales benefit from partnering with plankton by gaining access to innovative technologies, products, or business models that can complement their existing offerings, enhance their competitiveness, and drive growth. Additionally, partnering with startups can help whales stay agile and responsive to market changes.

In sum, an open talent model helps startups increase efficiencies while reducing costs. In parallel, understanding the new ecosystem of how startups can interact with – and complement – larger organisations offer a myriad of opportunities. This new reality is there for startups to take advantage of. Simultaneously, technology can help small and new companies do more with less, while lowering the barriers to entry.