Brexit has been blamed for an array of ills, from the sublime (the changing shape of Toblerone) to the downright ridiculous (paper cuts). But amid petty complaints lie legitimate concerns over the rules governing trade with our continental neighbours, our political direction, and the impact of a new economic climate on businesses of all shapes and sizes. When we at The Entrepreneurs Network polled entrepreneurs ahead of the big vote, we learnt that close to a third worried Brexit would have a "strongly negative" impact on the country's entrepreneurial activity.
Thanks to a new Barclays report, we know that the UK's environment for growth in the lead up to the referendum was stronger than at any time since 2011, in large part due to better access to finance, improvements in regulation, and increased research and innovation. Its Entrepreneurs Index score has risen by 10.5 percentage points, from a base of 100 in 2011, indicating strong overall progress in the UK's entrepreneurial environment.
We know that entrepreneurs are uniquely able to cope with a rapidly changing landscape and seize opportunities at times of economic uncertainty where others see risk and exercise caution. We also know that the UK has no shortage of startups - in the first half of 2016, a jaw-dropping 80 businesses were being born every hour.
Nonetheless, the wider picture is mixed. The UK still lacks an expanding cohort of fast growth firms: those businesses with revenues of between £2.5m and £100m, and at least a 33 per cent increase in turnover over three years, as well as at least 10 per cent year-on-year growth for a minimum of two of these years. And Brexit could stunt growth further. According to the Barclays findings, entrepreneurial growth activity remains "fairly flat," with fewer firms managing to meet the measure of "high-growth". Of equal concern, we're told that Britain lacks businesses with the ambition to scale. M&A activity may be strong, but few young companies are choosing to IPO.
The issues outlined in the report are all too familiar: talent shortages, in part driven by too few students opting for STEM subjects; myriad challenges around taking on investment; or plans for international expansion which fail to materialise. But it's not all bad news: regulatory conditions are the best seen since the Entrepreneur Index began. As the report highlights:
"The UK's corporation tax rate is currently at its lowest ever, while specific reliefs aimed at early-stage investors - namely the Enterprise Investment Scheme (EIS) and seed EIS - have created a favourable tax environment. And, in 2016, the Enterprise Act came into force, which seeks to further ease the regulatory burden on small business, and establishes a Small Business Commissioner to help small firms resolve issues, such as late payments."
And while the Chancellor may have missed an opportunity to further lift the burden on businesses in this week's Autumn Statement, our members will be happy with many of the announcements, not least £1bn for digital infrastructure and the £23bn he pledged to spend on innovation and infrastructure over five years.
The decision by the Chancellor to scrap the Autumn Statement altogether was also welcome - fewer Budgets will mean entrepreneurs can better plan for the future. We now wait for the weightier Spring Budget to see if Philip Hammond will take real action to cut the most destructive taxes and simplify incentives to boost UK entrepreneurship.Suggest a correction