One of business’ brightest brains shares his thoughts
Doug Richard is a serial entrepreneur, angel investor, ex Dragons’ Den star and founder of School for Startups, which teaches people how to start up and run better businesses.
Where are the biggest opportunities for London’s start-up scene?
London represents probably the most important concentration of creative industries in the world. Yet all the focus seems to be on Silicon Roundabout – which is kind of ironic given that we’re a distant second place in that regard [internationally], but a clear first place in almost all of the creative industries.
In 2012 all businesses will be internet businesses. So rather than just talking about “tech businesses”, what about talking about tech in a certain sector: tech in post-production, in advertising, in media, in creative, in fashion.
London is a giant when it comes to creative industries, and the intersection between technology and creative industries is what’s interesting. It’s an unsung opportunity for Britain. We only have one creativity industry that has truly absorbed technology, and that’s music. Everything else is to come.
- Doug has recently launched School for Creative Startups to help coach creative types starting businesses.
What technologies are going to be most disruptive in the future?
The ebook revolution has finally arrived, and it’s only really in the last 12 months that it has taken hold. You’re going to see more and more of that.
Players and tablets are, right now, still in the early days. The numbers are still growing fairly slowly relative to the general population. But in three or four years from now, everybody will carry a tablet of some form as their primary device. It might not smell or taste or look like an iPad, but it will be a tablet device in your life.
That means pretty much all your media will be consumed on it. And that means readers won’t really care if your media is print or enhanced print or video, it’ll just be interactive. So the question of what constitutes a book versus an app, and so on – the distinction will become a very blurred line. I think that’s a big change.
Further upstream, they build PC chips into pretty much every single TV at this point. All new TVs are now direct to internet. Now that is a step before the change has happened – you’re not seeing the ebook self-publishing thing with TV yet. But if you look at the fact that YouTube is starting to buy up premium content and act like an American cable channel, and signing a commission, you can smell it a mile away.
An individual author can labour for a year, or two or five, and write a book. It’s not as easy to create a TV show on that [same] cost basis. So what is the baseline cost for TV? It’s not as much as is currently charged – a commissioned factual entertainment show for the BBC costs around a quarter of a million dollars.
It doesn’t need to be that expensive, but there are still costs involved [if you’re making a TV programme].
If you’re going to do location shooting you still need a camera guy and a sound guy and a production guy and a gaffer. The cost of people doesn’t change, so those are real costs. Those costs are a hurdle, a hurdle you’ve got to overcome. That means roll-your-own TV is going to look different from roll-your-own book. When books become ebooks, then everyone can self-publish. But when TV becomes self-TV, it’s not going to have the same quality of great material just because the intermediary is dis-intermediated.
What are the biggest obstacles for London start-ups?
Access to finance.
Plus the marginal cost of London – it’s a bloody expensive place! The cost of people being here is high, therefore the cost of starting up here is high.
I also think we’re spotty with talent. There’s huge depths of talent in some areas, but not in others. We’re short on managers and brand managers and senior marketers. We don’t have that talent. But we are really, really rich in creative industries, and we’ve got great software programming talent.
Is there any way to redress that skills imbalance?
I think we should make it a lot easier to let more skilled people enter the country. We need to get our immigration act together. Which means we need to be focused less on refugees and more on talent. And that’s an un-politically correct statement if I ever gave one!
Is there anything the government should be doing to restructure the way our workforce is educated?
It’s a very big question. I think we have a great education system, even though we test it terribly with all the changes we make – and with the pre-occupation with exams in secondary schools.
I think we’ve got a big issue with our universities. A few in this country are the best in the world, but there are many that are becoming second class; partly because we starve them, and partly because they have never been subjected to any need to respond to students. Now, the ironic outcome of the tuition fees [issue] is that it is forcing universities to answer the question: “What am I going to do with my money?”
It’s long overdue. A lot of universities have not been responsive to students. Some students only see their professors three times a week! That’s not an education. That’s a minor scandal. I think you combine that with the fact universities are not moving fast enough.
There is a bias when it comes to modern degrees. Therefore a modern anthropology degree doesn’t carry the same weight as a traditional anthropology degree. That’s essentially academic snobbery. But in any other nation, it is far more useful to do a social anthropology degree that gives you the tools to influence and play a role in the development of a product or brand. Whereas traditional anthropology teaches you to examine a native culture in Borneo. They’re both fine academically, but one of them has a relevance to our society.
Thanks for your thoughts Doug.
Thinking of starting up? Already running a business? Doug is hosting full-day seminars to help you exploit the potential of online. Find out more about Web Fuelled Business.