Research carried out to mark the fifth annual showcase of the Royal Academy of Engineering’s Enterprise Hub indicates that the UK may have pipped the US to the post as a centre for engineering start-ups.
While the US is thought of as top dog when it comes to tech start-ups, it turns out that innovation within the UK is alive and well, with a whopping 63 per cent of London engineers saying that they have founded their own business.
When widening that scope to the UK as whole, the figures stands at 34 per cent compared to 27 per cent in the US.
The research also found that a generation gap is widening between young graduate and academic entrepreneurs and those over the age of 40.
Just one in ten of those over 40 have started or even considered starting a business, in contrast to a third of those aged 21-30, rising to half of 31-40 year olds.
The findings will prove encouraging reading for the UK Government, as engineering enterprises will be essential to delivering the innovation and technological advances at the centre of the Industrial Strategy.
“Life may begin at 40, but it is clear that world-leading businesses start far earlier,” said Royal Academy of Engineering Enterprise Committee Chair Ian Shott.
“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.”
Attitudes toward enterprise appear to be changing, with fewer engineers now believing a ‘light bulb’ moment is essential for a business to succeed.
For those aged 21-40, hard work and outstanding engineering skills were seen as most important factors, pushing the light bulb moment into third place.
Just 1 in 10 of those aged 21-40 thought the flash of inspiration was essential, in contrast to 1 in 5 of those over the age of 40.
Region can also play a part, with just 15 per cent of those based outside London said they had founded their own firm, significantly below all regions of the US barring the Midwest.
One explanation for this may lie in attitudes to risk. The survey showed that those outside London were 23 per cent more likely to hold back due to worries that they might fail.
San Jose and Silicon Valley edged out London as the location identified as best for founding an engineering enterprise thanks to a highly skilled local engineering workforce, cultural appreciation of engineering and ease of access to investors.
In response to a question about what is required for enterprise to flourish, the engineers surveyed ranked access to funding as the number one factor, with access to customers and markets in second place and mentoring in third.
“We founded the Enterprise Hub to bring together exceptional engineering business leaders, both emerging and established, for mutual gain,” said Shott.
“Given time and support they have begun to develop tomorrow’s world-leading innovative enterprises, extending Britain’s reputation for invention and creativity.”
Since 2013 the Enterprise Hub has supported more than 100 entrepreneurs and SMEs, helping them to commercialise their ideas without taking a penny in return.
To date 70 start-ups have been established as investable, high-growth companies, generating 300 jobs and raising more than £63 million in follow-on funding.