Martin Brown: Why start-ups need to be tech-savvy

Every year, tens of thousands of new businesses start up in Scotland. According to most studies, more than half of them won't make it past the first five years. A depressing statistic, isn't it?

Martin Brown said Entrepreneurial Spark 'knows the importance of technology'. Picture: John Devlin

So what are the magic ingredients that keep the successful ones going? Other than the obvious ones like determination, focus, drive, good timing, a great underlying idea and sufficient demand for that idea, being tech-savvy is one of the most important things a fledgling business can do to increase its chances of longevity.

Digital technology is now the lifeblood of new businesses. From marketing the business through a great website and social media strategy, timesaving apps that could speed up back office functions and free up time to innovate, data storage, data analysis – the list of ways that technology can help a small business get ahead of the competition is endless. The trouble is, it’s sometimes daunting enough to make a would-be entrepreneur’s head spin. It can also be extremely expensive.

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Tech sector '˜needs to up its game' to attract talent

Entrepreneurial Spark, powered by Royal Bank of Scotland, as the world’s biggest free business accelerator, knows the importance of technology.

Having opened its first location in Glasgow in 2012, it has grown rapidly and now operates from 12 locations across the UK. Its “Chiclets” (the name for the entrepreneurs it supports) enjoy an excellent success rate – 88 per cent of them are still trading today.

Entrepreneurial Spark start-ups across the UK, including a number of fledging tech firms, have raised an impressive £45 million of investment to date. One of its biggest Scottish success stories is personalised shopping app business Mallzee, which raised £2.5m of funding last year and is now becoming a household name. Clearly, Entrepreneurial Spark’s support to young businesses is proving to be invaluable.

When Dell EMC decided to partner with Entrepreneurial Spark earlier this year and allow its Chiclets to tap into our own well-established tech skills and advice, it was because we feel strongly about helping the entrepreneurs of the future.

One of the biggest challenges facing start-ups is the availability of the skilled IT resources that larger businesses can take for granted. For a start-up business, good IT support can be hard to find and prohibitively expensive, especially as there’s a nationwide tech skills shortage which is driving up IT salaries.

At Dell EMC we want to encourage business growth and innovation in Scotland, as it’s a win-win situation for everyone. I don’t want to see potentially brilliant new businesses fail simply because they need help with their tech, but can’t find it or afford it.

For example, according to a recent survey by big data firm Accenture Analytics, 83 per cent of respondents believed their companies were ahead of their peers and had an advantage over their competitors because they were using their data effectively. That’s a great argument for data analysis, but with a salary for a data scientist in Scotland likely to be between £40,000 and £50,000, what entrepreneur or small business can dream of employing one?

We have now established our “Dell EMC @ Entrepreneurial Spark” programme for our employees who want to get involved in working with Entrepreneurial Spark’s start-ups. Already the signs are encouraging. Dell EMC and our other Dell Technology businesses, Pivotal and VMware, have been working with start-ups in a number of areas, including helping them to source key sales and technical staff, opening up global contacts, conducting technical, project management, sales and pipeline reviews, and providing free access to data scientists and chief technical officers. I’ve been involved in this personally, working with some promising start-up companies on improving their sales pipeline, which is my own area of expertise.

Already Entrepreneurial Spark is seeing an upturn in the number of technology businesses applying to join. We hope that our partnership is helping to encourage this trend. One of the best things about working with the Chiclets is that we get to spend time with some extremely creative, innovative and enthusiastic people – and we’re learning from them too.

• Martin Brown is Scottish country manager at Dell EMC