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This week, new figures showed that UK technology start-ups attracted a record amount of venture capital investment in the first half of 2015.
This is a startling statistic for those of us in technology, particularly as we have heard the naysayers consistently question whether transformational companies can be built in the UK. It seems London is finally starting to prove the pessimists wrong by attracting meaningful amounts of capital for fast-growing technology companies.
It makes sense. Start-ups will drive a significant share of UK GDP growth. Just look across the Atlantic where 40 per cent of US GDP is generated by companies that did not exist 30 years ago, according to Sherry Coutu’s ScaleUp report.
Young companies offer the flexibility, responsibility and autonomy to staff that few large companies can. That is why today’s students and job applicants increasingly want to found companies or work for start-ups. More than two-thirds of millennials want to start their own business, notes research from Bentley University in the US.
Gone are the days when students hoped for a stable job with a UK plc. Today’s graduates teach themselves to code and then seek out the thrill, responsibility and autonomy of the tech start-up rollercoaster. But is that a good thing?
I started my career at an investment bank after a liberal arts education. I did not know what I really wanted to do, felt I did not know how to do anything and assumed big companies were bound to do some things right. My intuition turned out to be correct. I learnt a ton, figured out I wanted to start a company and absorbed the best of the professional-services culture.
Would I do it again? Yes. Everyone should work at a big company to start their career. It is the modern version of gaining a postgraduate degree. But do not linger longer than necessary, make sure you get to the tech start-up yellow brick road as quickly as you can.
You will find exponential learning, responsibilities beyond your imagination and do more in three years than you will achieve in 13 somewhere else. And while you are having the time of your life, you will be helping the UK economy grow and proving naysayers wrong about London.
Brynne Herbert, a millennial, is the founder and chief executive of Move Guides, a start-up that helps companies relocate staff globally
It is official: the UK economy is growing. George Osborne made this clear in his budget speech last week. Companies will be setting up and there will be increased employment opportunities. No one will be more pleased than I if we start to erode the number of unemployed 18-24 year-olds, which remains stubbornly high.
Brynne thinks that working at start-up companies is great experience and I am sure she is right. But is it the right experience?
We still need people to work in big companies and, more to the point, we need people who can run them. True, there are fewer big big-company jobs these days. Of the 5m and more companies in the UK, fewer than 7,000 — let us say 0.001 per cent — employ more than 250 people. But the same 7,000 big companies, says the Department for Business, Enterprise & Skills, account for half the turnover of all UK companies and, between them, employ 10m of the working population of 25m.
Working at a big company is very different from at a small one. Large companies are on the whole “matrix-driven”, meaning that getting things done is harder and that influence matters more than control. If you have spent many years in small start-ups, my experience is that big companies will hesitate to employ you.
Nothing is more costly to an organisation than putting time and effort into recruiting and training people only for them to fail or leave. Barclays is searching for a new chief executive; I doubt the bank will be looking at candidates who have only done a few years in a big company and worked in small ones ever since.
I would argue that once Brynne’s company itself is large (and it is getting there fast) she too will require senior people who know how to operate in businesses that need several layers of governance in order to function.
She will be glad that some people did not rush to the “yellow brick road” of start-ups as soon as possible but instead took the route of working from the ground up in big companies such as Unilever, Tesco, or even Barclays. All three of which have excellent big company graduate training schemes that have developed great talent at a senior level.
Now that I think about it, Barclays may not need to look outside its ranks at all for a new chief executive.
Mrs Moneypenny owns and runs an executive search company. At 53, she is a (young) baby-boomer.