Having a great business idea is the easy bit. Turning it into a profitable business is something else altogether.
Bridging that gap is fundamental and very few people get it right. In fact, research telling you how difficult that process is can be found everywhere – a whopping 80% of entrepreneurs who start businesses fail within the first 18 months (Bloomberg) and half of UK start-ups fail within five years (RSA Insurance Group).
Talking to those who have bridged the gap is therefore a great starting point.
After having his own great idea, Lawrence Brand (Politics, 2011) spent his weekends building a quirky-looking bike in the corner of his living room. A year later he quit his day job and set off on a 5,000km, three-month unsupported test ride to Kazkahstan and when he got back, dusty, tired, but with the quirky-looking bike still in one piece, he launched Porterlight Bicycles as a manufacturing operation.
Today, six years after leaving The University of Nottingham, Porterlight Bicycles now produces everything from one-off custom cargo bikes, to whole international corporate fleets. Lawrence’s business has grown significantly to become the global cargo bike provider for Deliveroo, and has received national publicity and plaudits.
Lawrence’s prototype cargo bike was on display at The Design Museum as part of an exhibition on the Cycle Revolution and he’s also appeared in the Forbes 30 Under 30 list, which annually presents the brightest young entrepreneurs, innovators and game changers.
Boot-strapped from the word go
“I was in Sweden the year after I left Nottingham and I saw how cycle logistics could transform our urban transport for the better, and realised there was a need for modern, compact, easy-to-ride cargo bicycles, especially in the UK,” said Lawrence.
“Initially I funded the development and prototyping from my wages and later from my savings. With those quickly depleted however, it was important to quickly get to market, and begin getting sales income to keep the company afloat whilst trying to not give away equity. To this day the company remains boot-strapped and funded through its own pure organic growth.
“Getting the business started without much in the way of financial capital was very hard. It did come with its own benefits however, as needing to be frugal led me to develop a lot of new manufacturing processes in order to be able to do things on budget.
“Rather than go down a more traditional product development path of outsourcing elements of the manufacturing to professionals, keeping it in-house has given us a much better control over our research and development, allowing us to keep the costs down until we were ready to begin scaling the production process up.”
Know the right questions and get the answers
After graduating Lawrence spent the next few years working in tech start-ups in London learning first-hand how to start and operate a business
“I personally found it incredibly pivotal working in someone else’s start-up. Not only did I learn answers to important questions about starting and developing a new business, I learned what those important questions are in the first place!
“It’s also a good experience of the full mind-and-body commitment that it can take to get a company through its early days and onto the path to success.
“Starting your own business is always going to be a daunting prospect, and my firm advice would be not to chuck in the day job straight away, but to start building a ‘minimum viable product’ you can test the market with first. Do explore the resources open to you, as you really do need all the help you can get!"
Having Ingenuity makes a difference
Lawrence turned to the University for help in 2015 using the services of the Ingenuity Lab, which is run by the Haydn Green Institute at Nottingham University Business School. He entered both Ingenuity15 and 16, the UK’s largest entrepreneurship competition, which is run by the Lab, and walked away with prize money totalling £16,000.
“I was trying to seek out as many grants and bursaries as possible and the Lab was not only a good help in finding these, but I also used the Ingenuity prizes to continue developing my business,” he said.
The skills he developed during the competition proved to be incredibly useful.
“Running and owning your own business brings with it a number of big benefits, but the same things that make it great can have serious downsides. I’ve always been an independently minded person, so having the power to control and shape the business suits me well. You also have nowhere to hide and no one else to blame when things aren’t going well.
“The Ingenuity competition process was useful not only for its cash and professional-service prizes but also for the structured format through which you progress your business idea. Having to compile proper business plans, pitches, and presentations is a key exercise in formalizing your plans from an early stage, and for exposing aspects or flaws in your idea you might not have considered.
“The Lab is a fantastic resource. Being able to access their network of contacts, physical office space, and advisory service, is a massive help to any current student or alumni.”
Find out how the Ingenuity Lab could help develop your entrepreneurial ambitions and discover how you can register for the Ingenuity18 competition.
Posted on Thursday 25th May 2017