SME Investment Opportunites lost to Golden Triangle: Elitism?
Investment is thrown at corporates affiliated to golden triangle universities at the expense of less risky development at SME levels. Are VC’s missing out joining grand, blue sky development projects that are a lottery and overlooking lower risk opportunities among SMEs? Is investment passing by the UK’s world renowned idea generation among SMEs because they don’t normally come with the highest academic credentials?
Some sobering stats:
- Of all VC funding in the UK, only 8% goes to technical SMEs. This compares poorly with the US’s 30%
- Technical SMEs are responsible for £216 billion of UK yearly GDP. Critical to the nation’s success.
- The above figures suggest there is a growth gap for technical SMEs through insignificant investment from funds and VCs.
Golden Triangle start ups dominate the above – 80% of fund capital via VCs finds its way to projects associated with the golden triangle universities (Oxford, Cambridge, and top London universities). Is elitism at this level warranted when lower risk inventions that have often been created through experience rather than academic erudition exist? Are the other universities really so unworthy? Are those who arrive at invention via the door of decades of experience unworthy? How much of that 80% of fund capital finds it way to fanciful academia and fails?
A typical technical SME has a veritable mountain to climb to get any investment at all. That such edifices (Oxbridge) of left wing ideology are the authors of this blatant elitism needs exposure.
Are lower £NetAsset SMEs unworthy of more investment?
The answer is certainly NO!
Of course significant investment needs to find its way to ground breaking state of the art technology that’s under the auspice of the Golden Triangle, but it should be strictly managed on the basis of projected ROI and risk. It is probably valid to assert that global ground breakers are most likely born here, but many other more parochial initiatives are arguably better handled by tech SMEs and the like. Dyson is a good example – came from nothing. He didn’t come from the Golden Triangle and is a good example of incredibly successful business and ROI generated from almost nothing. He’d certainly have got there quicker if he had access to some of the Golden Triangle’s eye watering sums!
What is to be done about this travesty?
This is a difficult topic for the following reasons:
- It takes a leap of faith from so many VCs.
- Vehicles by which more practical projects, and consequently lower risk, need to be nurtured.
On the last bullet, there is such an organisation. DESN has set itself the task of breaking not just this but all barriers to entry for businesses wanting to move with our currently fast moving times (AI, AIoT, ASIC, etc.). Please follow the link to DESN website if interested.
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