Difficulty obtaining finance and a general skills shortage risk undermining Britain’s start-up entrepreneurs, the Institute of Directors (IoD) has warned today.
The recent survey carried out by the the IoD 99 network – which is made up of more than 650 entrepreneurs under the age of 35 – suggests that of all that were surveyed an alarming two-fifths said they have trouble hiring people with the right skills, with 39% citing difficulty accessing finance as a potential barrier to growth.
In addition to this, more than half said that money from family members had been instrumental in getting their business off the ground, while 56% had used personal unsecured finance, like credit cards, and a further 45% had used money from friends.
The IoD has called for government to open up the ‘equity economy’ to make it easier for savers to invest in young companies and turn Britain’s fledgling start-ups into scale-ups. The business group has also warned politicians against imposing arbitrary restrictions on the UK immigration system, which will make it harder for growing firms to bring in skilled workers from around the world.
Jimmy McLoughlin, Deputy Head of Policy at the IoD, said:
“The start-up revolution has taken hold in Britain like nowhere else in Europe. With so many young, exciting and cutting-edge businesses having popped up in recent years, it is vital to harness their potential and create the next raft of world-leading companies. Finding people with the right skills, and tapping into the right mix of finance will be the biggest factors in achieving scale-up success. For start-ups, overcoming these obstacles can be the difference between success and failure.”
