On September 5th, I attended the prestigious House of Lords launch event for the Backing Breakthrough Businesses report, where key leaders gathered to discuss the future of the UK economy, small businesses, and fintech. The event featured speeches from Lord Iain McNicol, Jonathan Reynolds, and Steve Rigby, each offering unique perspectives on the challenges and opportunities ahead for UK entrepreneurs.
Despite the grandeur of the venue, the challenges discussed were sobering: scaling businesses in the UK remains a challenge, the country’s economic growth is lagging, and a fundamental shift in political and economic strategy is needed. Here’s a summary of the key insights from the event.
Lord Iain McNicol: Building a Sustainable Future
Lord Iain McNicol of West Kilbride, former General Secretary of the Labour Party (2011-2018) and a seasoned entrepreneur, kicked off the event with an engaging reflection on his experience in the business world. McNicol co-founded Rewired Earth, a Community Interest Company that aims to transform how financial markets value sustainability. Their unique approach involves lending in the subprime unsecured market by using Open Banking instead of traditional credit reference agencies.
Reflecting on the challenges of scaling businesses in the UK, McNicol shared a powerful story: “Two years ago, we wanted to scale the business. Nobody would touch us in the UK—neither the banks nor the VCs. We had to go to America, where we secured the £40 million needed to scale.” His story resonated with many attendees, highlighting the difficulties UK businesses face when trying to expand.
McNicol echoed a sentiment shared by Valentina Kristensen: “We need to move away from dividend-paying to growth capital.” He stressed that the upcoming Investment Summit on October 14th represents a significant opportunity for businesses to explore new avenues for growth and investment.
Jonathan Reynolds: The UK’s Economic Crossroads
Next, Jonathan Reynolds, the Secretary of State for Business and Trade, delivered a sobering yet hopeful speech. Reynolds began by acknowledging the wealth of entrepreneurial talent in the UK, but reminded the audience of the fundamental shifts that have taken place since the global financial crisis. These shifts, he argued, are jeopardizing the opportunities that future generations might have.
Reynolds emphasized the importance of stability—not just in government leadership, but in policy consistency: “It’s about policy stability as well. The Business Secretary should last more than one year.”
His message was clear: for Britain to maintain its economic stature, it must adopt long-term strategies that support entrepreneurs and businesses. He expressed concern over the country’s low productivity growth and hinted that the Labour Party could offer the stability and support required for UK businesses to thrive. This discussion ties into the broader themes explored in the Building Blocks report, which examines how past governments have struggled to address fundamental economic issues.
Steve Rigby: Fostering Private Business Growth
Wrapping up the event, Steve Rigby, Co-CEO of the Rigby Group and Chair of the Private Business Commission, delivered an uplifting speech on the resilience and strength of the UK economy. With £4 billion in revenue, Rigby’s family-owned business is a testament to the power of privately held, cash-generative models.
Rigby’s optimism was tempered by caution. While the UK remains the sixth-largest economy in the world, business sentiment is waning. He cited recent surveys that suggest business confidence is slipping, especially ahead of the upcoming Budget. Rigby made the case for a tax system that both incentivizes and challenges entrepreneurs: “If you’re an entrepreneur, you’re trying to grow your business. We also need an environment that allows us to do that.”
Rigby’s comments highlighted a key theme of the event: while the government has a role to play in regulating and taxing businesses, entrepreneurs must also step up and take ownership of their growth. He called for a business environment that balances innovation with a fair and supportive tax system.
Key Takeaways from the Event
The Backing Breakthrough Businesses report launch at the House of Lords provided a unique opportunity to explore the challenges facing UK businesses. From the speeches delivered by Lord Iain McNicol, Jonathan Reynolds, and Steve Rigby, several critical themes emerged:
- Scaling Remains a Challenge: As highlighted by Lord McNicol’s experience with Rewired Earth, many UK businesses face significant hurdles when trying to secure the capital needed for growth. The October 14th Investment Summit offers a key opportunity for businesses to explore growth capital and attract investors.
- The Need for Policy Stability: Jonathan Reynolds emphasized that policy consistency is essential for economic stability. He suggested that the current system doesn’t offer the long-term support needed for businesses and entrepreneurs to thrive, but hinted that Labour’s approach could change that.
- Tax Reform and Private Business: Steve Rigby stressed the importance of a tax system that serves as both a carrot and a stick. Entrepreneurs need the space to innovate, but they also need a regulatory environment that encourages growth. Rigby’s call for a balanced approach was a key highlight of the event.
Looking Ahead: The Investment Summit
The Investment Summit on October 14th is set to be a pivotal event for entrepreneurs and investors alike. With discussions focused on increasing equity shares, fostering business partnerships, and exploring the shifting dynamics of the stock market, the summit promises to offer crucial insights into the future of the UK’s business landscape.
As businesses look to scale and attract growth capital, events like these provide the perfect platform to connect with investors, policymakers, and other stakeholders who can help shape the future of UK enterprise.
In conclusion, the Backing Breakthrough Businesses event at the House of Lords underscored the importance of partnerships, policy stability, and tax reform. As we look toward the Investment Summit, the message is clear: entrepreneurs need both government support and a business environment that allows for sustainable growth.
