During the last week, the judging process for the 2021 Wales Startup Awards conducted 118 interviews with arguably some of the best new Welsh businesses.
Over six days, the forty one judges experienced the depth and breadth of the startup scene in Wales and heard some amazing stories of resilience, creativity and sheer hard work.
As someone who has been involved in supporting businesses in Wales for a quarter of a century, the process opened a window on the state of entrepreneurship across the country and, more importantly, enabled me to understand some of the key issues facing startups as we emerge into a new economic reality.
So what did I learn from these amazing individuals and their firms?
First of all, entrepreneurial spirit and drive is alive and well in Wales. We have interviewed some amazing companies from every sector and every part of the nation and it is incredible to see the enthusiasm these new businesses have for their products or services.
More importantly, every single business we talked to were optimistic not only about their own future but that of the Welsh economy. In fact, the vast majority were continuing with their plans for growth over the next few months despite a range of uncertainties.
It was also clear that there had been amazing resilience shown by these firms during the Covid pandemic. A high proportion of the finalists started their businesses in the few months before the first lockdown in March 2020 or directly afterwards.
Some in sectors such as retail and tourism had to change their business model completely whilst others buckled down and worked even harder to ensure their businesses succeeded during difficult times
More importantly, we saw countless examples of these new businesses that, despite their own financial struggles, had made extraordinary efforts to support their local areas, the NHS and other businesses during the pandemic. Many were contributing to local and national charities and this demonstrated that at the heart of many Welsh firms, there is an outlook by the founders that is not all about profit but also about looking after the communities in which they live and work.
Unfortunately, they did not always get the backing they deserved and there was widespread disappointment at the lack of support for startups from the Welsh Government during the pandemic especially in terms of the exclusion of new businesses from direct grant support.
In contrast, nearly all of the businesses had taken advantage of the furlough scheme to save their businesses and a number said they had expected to make their staff redundant before the announcement from the Treasury about this programme had enabled them to keep their workers that were now back working for the business.
Whilst many of these firms had great potential, lack of finance remains a key issue for many of the businesses that were showcased at the awards. Despite the usual claims that there is funding available in Wales for new businesses, that did not seem to be the case with a range of firms with considerable growth potential.
This yet again supports what some of us have been saying consistently for a number of years namely that there is a real need for a dedicated venture capital fund for Welsh firms that enables them to turn new firms into scale up businesses quickly before the opportunities are lost.
That is not to say that there are not new businesses that are already well on the way to making their mark in their sectors and more widely. For example, there were at least two startups that could potentially achieve unicorn status within the next couple of years with the right headwinds and at least another five that could have first mover advantage into global markets worth billions of pounds.
There also needs to be a realisation that startup success is not limited to so-called “sexy sectors” such as cyber or fintech that have received much attention in the press over recent months.
The medtech sector is another area which has enormous scope for growth with some life changing innovations that just need the right backing to enable them to be commercialised properly. In addition, whilst construction is probably the least attractive sector for many startups, the new businesses that were shortlisted in these sectors are at the forefront of their field in digitising the industry and, more importantly, are completely transforming the way that capital projects can be delivered more efficiently, potentially saving hundreds of millions of pounds in the process.
It was also great to see so many of the sponsors and independent judges offering their help and support to businesses. This included access to markets, funding and other opportunities which could really make the difference to some of these firms and later this month, we will be digging deeper into any ‘asks’ that these new businesses require from our support network.
Therefore, it’s been an intense but fruitful week of interviews which has not only been enjoyable but has showcased the entrepreneurial talent that we have here in Wales.
From my personal point of view, it’s been an honour and privilege to hear about the journeys faced by an amazing range of new businesses here in Wales and made me think hard about what else we can do to maximise the potential of these firms.
But most importantly, it has reinforced my faith that we have entrepreneurs that are as good or better than those in any other part of the UK and that can only be good news for the Welsh economy going forward.