Big Innovation Centre calls on Chancellor to support innovative businesses
In an open letter to the Chancellor ahead of his Autumn Statement, the Big Innovation Centre has outlined three crucial opportunities for the government to unlock innovation and sustain the UK’s economic recovery in the long term:
1. Increase financial support to innovators, especially start-ups and SMEs, by granting them greater access to angel investors and seed funds. The government should look into ways of properly valuing knowledge-based assets, which would greatly facilitate an innovative SME’s chances of obtaining funding. The British Business Bank must also provide competition to the financial sector, by providing alternative forms of finance which are attractive for young, high-growth SMEs.
2. Government needs to make more use of its convening power to encourage cross-industry collaborations, which have proven to be very successful in linking innovative SMEs with large companies, universities, banks, business support groups and investment opportunities. To further promote home-grown and international investment in UK innovation, the government could use initiatives like the Regional Growth Fund to match private investment in areas where it has not been forthcoming.
3. Government policy must focus on supporting existing markets to reinvent themselves, rather than attempting to make new ones from scratch. Businesses and entrepreneurs would greatly benefit from regulatory and legal reform whilst developing emerging markets, in which government can play a greater role. By taking more time to understand the needs and challenges faced by businesses in these emerging markets, government can put more investment into business insight, as opposed to solely focusing on technology foresight.
Big Innovation Centre Director, Birgitte Andersen, said, “Currently, unproductive firms are being kept alive by low interest rates and tolerant lenders, while too many firms with high potential are struggling to find the help they need to grow. This is the opposite of how a financial system should allocate resources.
“We believe that new types of banking, more cross-industry collaborations and developing a truly supportive environment for innovative companies will not only overcome structural barriers in our economy, but will also build the markets and business models of the future.”
