Entrepreneurs are becoming younger, less experienced but more confident, says SETsquared chair Keith Robson.
Entrepreneurs are becoming younger, less experienced but more confident, says Keith Robson, management group chairman of early-stage enterprise support partnership SETsquared.
Established 10 years ago, SETsquared, a partnership formed by the universities of Surrey, Southampton, Bath and Bristol, supports and raises investment for early-stage companies and entrepreneurs. In a question and answer session with GrowthBusiness, Robson, who is also research and enterprise support director of the University of Surrey, details the group’s history and future plans, and his observations about the fundraising market.
How would you describe SETsquared?
The basics are that four universities – Surrey, Southampton, Bath and Bristol – banded together to help businesses start up in a more friendly and supportive environment, and give them a kick-start in growth. It’s all about helping establish viable businesses that are going to grow and establish themselves in the UK, and beyond.
How long has the partnership been in action?
The partnership has been going for ten years but there was a real big change in our direction in 2004. That year we secured just over £13 million in government funding which we used to set up a network of specialist incubation centres in each of our four universities. We based the model on some of the most successful practices of Californian universities.
How many companies do you support and how much have you raised?
We currently have about 100 companies supported. We’ve helped them raise over £120 million in early-stage funding and those companies have increased in size and created 1,000 jobs. Each October, we have an annual investor showcase, which is focused on the more advanced companies, and we have raised another £100 million in terms of venture funding for them.
What is one of SETsquared’s success stories?
One company, Revolymer, which came out of and has been supported in the unit at Southampton for many years, has had a breakthrough in producing a new chewing gum. They are just about to launch a new product that we imagine will completely replace existing gum. They are expecting to go live with various manufacturing agreements next year.
What trends have you seen over the past 10 years in technology?
We have not seen massive differences. Most of the companies we work with are relatively high technology, and most of it is what we call clean manufacturing, which suits the UK economy rather well.
We haven’t seen a big shift [in the type of companies] but what we are seeing is a greater confidence within our tenants. And, what we are getting is a bit of a cluster effect now. We’ve had one of two successes and little clusters of companies are emerging in similar fields and sharing experience.
How have investors been reacting to your offerings, particularly noting this current climate?
It’s never been easy. It’s still not easy, but what we have seen is that the SETsquared brand has helped us open doors and maintain credibility in the marketplace. The annual investor showcase was well attended this year, as it has always been, even in these difficult times. Putting forward a credible portfolio of companies year after year, and demonstrating continuity, has really resonated with the investment community.
What is the average investment that has been secured by your companies?
It will range anywhere between £500,000 and £5 million.
The entrepreneurs coming to you: are they becoming younger or older, or more educated?
We have always had a smattering of younger and older inventors. There are slightly younger, newer, entrepreneurs coming in now though, because confidence is increasing. This is also due to the fact we use a system of mentors that provides the companies independent advice. And I think that is helping, fresher, newer, less experienced entrepreneurs come in with a greater feeling of support and security.
What will the next ten years bring?
Next year, another university will be joining the SETsquared group. We are looking in time to add one more after this one, but that would be it. Adding more universities gives us an opportunity to extend our model, particularly given that the current universities are all in the South East, and increase the number of companies we can support.