Welcome to the Information Page for Mowgli UK.
This page gives some background facts and figures which place Mowgli’s work mentoring UK entrepreneurs- and especially social entrepreneurs- in the context of the current business climate and support services for SME owner/managers. If you have any questions, please do contact us.
Introduction
According to the UK Government, the UK’s “vision is for many more citizens to have the opportunity, aspiration and motivation to use their talent and initiative to be enterprising[…].” Mowgli sees its role primarily in providing mentors as motivators for entrepreneurs, but our impact can be much more widespread; we have seen with our entrepreneurs how successful mentoring can create permanent change. By motivating entrepreneurs to succeed, we indirectly support both aspiration and opportunity in individuals around them who see them as positive role models; and the relationships we create can help whole communities to change.
The current need for mentors in business:a look at UK unemployment and how businesses can help
Unemployment is a major social issue in the UK which we believe socially conscious entrepreneurship can address. Since early 2008, the economic downturn has profoundly affected the national unemployment rate; by the end of 2009 the number of unemployed had risen from 1.6 million to nearly 2.5 million people out of work. (1) In 2011 they rose even higher but are now slightly falling (latest figures here).
Source: ONS
In October 2010, a report from PWC estimated that due to public sector job cuts of around half a million jobs by 2014/15, and the knock-on effect for the private sector, that the UK could be facing a million total job losses from its employment market. (2) In addition, small businesses have been hit directly by the 2008 credit crunch: a total of 279,000 businesses closed in 2009, the highest number since current records began in 2000.(3)
The coalition government is relying on the private sector to sustain the economy through the impact of the credit crunch and public sector cuts, but since the closure was announced of BusinessLink, which supported around 942,000 businesses per year(4), it is clear that in the immediate future there will be a significant shortfall in business advisory services- and little tailored free advice for social enterprises at the growth stage. There are 4.8 million SMEs in the UK as of 2009 (5). Of these SMEs, a significant number are classified as social enterprises and this number is increasing year on year- 7% in 2010 up from 4% in 2007. The number of private SME owners who self-define as social enterprises is much higher- 34% of businesses founded in the last three years defined themselves as social enterprises, compared to 25 per cent of those founded 10 years ago or before.
Nearly 75% of SMEs are owner-managers with no employees or partners to turn to for support, and although the government is aiming to transfer all business advisory support to the web, 24% of all SMEs are not currently online and the contingency plans for covering the loss of BusinessLink regional centres (emergency interim call centres for example) are sketchy (6). In order to address the gap in business advisory provision for these groups and to bolster the growth of high-potential SMEs, the UK government intends to roll out mentoring support on a wide scale; there is a high reliance on voluntary and third-sector organisations for providing these mentors (including Mowgli UK).
Only one in ten UK SMEs used a mentor in 2009 (6). The Global Entrepreneurship Monitor found that only the UK, along with Italy, has the lowest proportion of established business owners with high job expectations.(7).
Lubna Latif, Mowgli Entrepreneur
At Mowgli UK, we’ve seen the entrepreneurs on our pilot programme make huge differences to their businesses already with the support of their mentors… (read Lubna’s story here). If we can scale up the Mowgli model to help hundreds of entrepreneurs across the UK, we can begin to change the overall picture from rising unemployment, to one of aspiration and inspiration- for business owners who want to reach their full business and personal potential.
Enterprise in the UK
While the British economy may have slowed down in recent years, British entrepreneurs refuse to let their ambitions slide. Manufacturing, internet-based start-ups, and retail are all well-represented in the UK’s small business landscape, with a particularly buzzing scene for technology business. The UK is the best place in the EU to do business, according to the UKTI; in particular, the British environmental technology market is worth some US$515 billion – and growing fast. Over 100 science parks and innovation centres – more than 1,600 companies – actively support new businesses across the country.
The UK is also a hotbed of ‘social entrepreneurship’, with many British businesses aiming to change their community, UK society, or even the world for the better- dreams which can be realised by a sustainable business making a healthy financial profit.
Social Entrepreneurship: What is it?
It’s important to be aware that people sometimes talk about social enterprises and mean slightly different things. In the UK, it is what a business does with its profits that determines whether it is a social enterprise, rather than its legal structure. According to the government, “A social enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.” (Here’s the full guide to setting up a social enterprise on BusinessLink).
A more readable explanation is given by the Social Enterprise Coalition, which should be your first port of call for information if you are a social entrepreneur:
“A social enterprise is a business that trades to tackle social problems, improve communities, people’s life chances, or the environment. This might sound like charity work, but social enterprises are businesses. They make and do things that earn moneyand make profits like any business. It is how they work and what theydo with their profits that is different: working to make a bigger difference, reinvesting the profits they make to do more good.”
For example:
Saeed Omar, social entrepreneur and Mowgli Mentee
Saeed Omar has just joined a Mowgli Mentoring Experience (May 2011). His business, SitatByoot, provides a web platform for the sale of products handmade by housewives who would not otherwise be able to go out to work. Because the business is oriented strongly towards a social aim- reducing the high levels of unemployment amongst Arab women across the MENA states- it is fair to call it a social enterprise. If his business was to grow, the social benefits to communities around it would be have a profound impact, far beyond the immediate value of the financial benefits which directly accrue to Saeed. It is entrepreneurs like this, and mentors who want to work with them, who Mowgli UK is searching for (in large numbers!) if we are to make a significant difference- along with our partners. (Follow Saeed on Twitter @SaeedOmar!)
Attitudes of UK Entrepreneurs
The Global Entrepreneurship Monitor, which tracks entrepreneurial perception and activity of individuals both on a national and a global level, surveyed 30,003 adults in the UK in 2009 and found that the number of perceived opportunities for starting a business had declined in the UK, as had the opinion that entrepreneurship is a good career choice. The number of those who expect to start a business in the next 3 years, or those who are already in the process of starting up, was correspondingly smaller than in the US and G7 countries. Not only do half of both start-up owners and established business owners felt that opportunities have slowed down for them as a result of the recession, potential British entrepreneurs may not act to put their ideas into action due to concerns about the future; 35% of those who see an opportunity for start-up would be prevented by fear of failure.
In 2010, the GEM survey found that many of these attitudes were recovering to pre-economic crisis levels along with the rest of the G7. We at Mowgli are excited to see entrepreneurial spirit on the rise again in the UK. Read more about the Global Entrepreneurship Monitor in the UK here.
Further Reading:
(4) Press Release from Business Link: “Survey finds that BusinessLink users saved 5.3 million hours last year” (11 March 2010)
(6) Bigger, Better Business (UK BIS 2011) available here
(7) Global Entrepreneurship Monitor- UK GEM Report 2010, p22
- Visit the UK BIS Statistics page for enterprise and employment here
- Learn more about ‘Social Entrepreneurship’ with the Social Enterprise Coalition
- Read the full Global Entrepreneurship Monitor 2010 UK Report on the GEM website http://www.gemconsortium.org
- Read Management Today’s ‘Top 100 British Entrepreneurs 2011’ list here.
- Read more about the Deloitte Entrepreneurship Survey on their website here
The Mowgli Foundation invests in mentors and entrepreneurs who can make a difference. If you would like to get involved in a UK scheme or find out more about mentoring an entrepreneur in a developing country, visit our Get Involved pages.
