Lars Lindstedt, software economist at Microsoft, gives his view on why new technology companies matter to big companies like his
Many commentators have characterised the UK start-up landscape as lacking some of the verve and dynamism of other markets around the world. Whether that’s because of difficulties in accessing early stage venture capital (VC), or more symptomatic of cultural blockages around supporting entrepreneurs and the ‘smart bet’, is unclear.
But we shouldn’t be too downbeat about the vitality of entrepreneurship in the UK because when compared to our European neighbours we come out rather well. There are some brilliant ideas, concepts and products emerging from UK companies and universities, encouraged by an emerging sense of partnership between industry, academia and government. For example, our gaming and creative industries lead the world, and the proportion of innovation active companies has risen by 17 points over the last five years (Department for Business Enterprise & Regulatory Reform, UK Innovation Survey). Moreover, the UK has four universities in the world’s top ten.
I believe that the UK has a unique ability to incubate innovation and that established businesses like ours have a role to play in fostering and supporting start-ups. We believe we can help link the venture capital community, academia, innovators and entrepreneurs together in an arena where the best ideas can flourish. This is why we launched the Microsoft Startup Accelerator Programme in October 2007.
Initially, five home-grown businesses were successful in getting onto the scheme; the companies were vetted on their innovations, growth potential and level of funding. Each received customised engagement plans to support their software and market development efforts but perhaps most importantly, they have access to the wide array of networks and contacts across the industry and the VC community. Accessing this rich level of business support and experience is absolutely critical to the start-up community who can hit stumbling blocks because these networks and knowledge banks can be hard to unearth. On top of this the businesses were also able to tap into the talent pool of technology and business experts at Microsoft.
One of the companies we have been working with is Zebtab - a desktop widget that allows content owners to deliver their rich media direct to the consumer’s desktops. Developed on a Microsoft platform, Zebtab enjoys significant insight and assistance on product development from our technical advisors. For instance, after an initial three-week prototyping exercise at the Microsoft Technology Centre in Reading, Zebtab is now going through an intense development period utilising the very latest presentation technology, as it prepares to unveil Zebtab v2.0 in early 2008. The company has an ambitious growth target and forecasts to make well over £2m gross profit by 2010 having started business in 2005. This is the kind of exciting business growth that we want to help deliver.
It won’t be long before the next round of start-ups join the Accelerator Programme but the original participants like Zebtab are already seeing the benefits in being involved in the initiative. It’s critical that the next generation of innovators, many of which can be found in the start-up community, thrive and prosper. With an economy increasingly built around knowledge and the ability to uncover new ideas, businesses like Microsoft have a responsibility to help nurture talent in the UK. After all, if the wider UK economy is flourishing, this bodes well for business opportunities for Microsoft as well.
