E-Spark leader wants focus on 'pre-scale'
Incubator boss blasts ‘vanity’ pursuit of next unicorns
Jim Duffy, chief executive of the Entrepreneurial Spark incubators, has called for a reality check among those who believe other firms can emulate the success of Skyscanner and FanDuel which have achieved such valuations.
Mr Duffy (pictured) is warning against writing off companies because they are not likely to reach such heights. Instead, he wants the focus to be on “pre-scale” businesses.
Speaking ahead of the Entrepreneurial Scotland conference taking place at Gleneagles today, he says it is essential to get these businesses right before thinking beyond that stage.
“You can’t go from passing your Standard Grade on the Friday to doing your PhD on the Monday,” he says. “We’re constantly reading and hearing about the importance of scale-up and how we must concentrate efforts, money and resources to make it happen.
“Don’t get me wrong, I applaud that aspiration wholeheartedly, but what we’re then saying with that approach is if your business isn’t scalable right now then it isn’t up to scratch and we’re not interested.
“This misguided focus on scale-up, founded on ego and vanity, risks leaving the real stars behind in Scotland. We know SMEs are the backbone of the economy and create the jobs and value in the economy. If we don’t appreciate that and enrich the ecosystem to kick them on then they will fizzle out.
“What I’m saying today is we need to give them that extra support and focus when they hit the bumpy middle ground after the start-up stage – what I’m calling pre-scale – and develop their leadership and mindset to get them to that next bit.”
He defined pre-scale as businesses that have been going for between two and six years, with 10 to 50 staff, and having raised between £500,000 and £2 million.
Mr Duffy cautioned about the potential impact that a failed concentration on scale-up could have for Scotland’s entrepreneurial culture, which is experiencing heady times at present.
“We’ve come a long way in Scotland over the last few years in terms of encouraging entrepreneurial behaviour and challenging our normal dour national psyche that abhors risk.
“To now run for a different goal, which we’re simply not geared up to achieve, puts this all in jeopardy should it all come tumbling down.”
Photo of Jim Duffy by Terry Murden