UK ‘trumps’ US for engineering startups (thanks to London)
4 Jun 2018
New research suggests that the UK no longer lags behind the USA when it comes to business startups – at least in the engineering sector.
Surveys carried out for both countries by the Royal Academy of Engineering suggest that more than a third of British engineers responding had founded their own company, compared to just over a quarter in the United States.
The results, though, are skewed by the fact that, within London the percentage is considerably higher – with nearly two thirds, or 63%, having taken the step.
I am encouraged to see that a new generation of engineering entrepreneurs is rising to the challenge
Ian Shott, chair, RAE
There is also a much greater entrepreneurial spirit among those under 40 years of age. Whereas only 9% of over-40s have chosen to become their own boss, the percentage rises to 41% for the younger cohort.
Commenting on the results, published to coincide with the RAE’s fifth annual show case, the organisation’s chair Ian Shott said: “The UK has lagged behind the US in commercialising its world-class research, so I am encouraged to see that a new generation of engineering entrepreneurs is rising to the challenge.”
While the news may encourage the Government in its determination to foster a more commercial spirit in preparation for the challenges of Brexit, there remains a sharp divide between London and the rest of the country – with the capital accounting for Britain’s high overall rating.
Outside London, engineers are far more risk-averse: only 15% of respondents have set up their own company – a figure far below most regions of the US. Nearly a quarter of non-Londoners said fear of failure had deterred them.
Dr Jenifer Baxter, head of engineering at the Institution of Mechanical Engineers (IMechE), said the imbalance demonstrated more needed to be done to exploit regional capabilities.
“News that fewer than one in six engineers based outside the capital have set up their own business shows that Government must do more to provide support for new engineering companies at a localised level,” said Baxter.
“Engineering startups must have the right support networks in place providing, financial, incubation opportunities and industry connections to enable new ideas to be translated into reality and to create sustainable supply chains across our regions.”
Engineering research was well distributed throughout the UK, she said, adding that the many startups formed as university spin-outs should be supported more to ensure the regions can prosper.
The RAE’s Enterprise Hub, set up five years ago, has supported more than 100 ventures. Almost 70% have been established as investable companies, providing 300 jobs and raising £63 million in follow-up funding.
