Creative industries “poised to lead the way" says Work Foundation VC
Leading economics commentator and vice-chair of the Work Foundation, Will Hutton, has stated that the creative industries have “come of age” and were “poised to lead the way in international trade and growth”.
He listed “high speed broadband and access to finance” as two of the keys to growth in the sector and emphasised the need for the creative sector to “speak with one voice” and become “champions of good capitalism”,
“There is a great amount of market uncertainty when it comes to investment in the UK’s creative industries and yet this creative economy continues to be cited as one of the sectors of the UK most likely to generate jobs and economic growth,” said Hutton.
“It is vital that government and private investment work together to build networks and understanding between investors, creative and cultural entrepreneurs, and those able to seriously boost the UK’s cultural and creative economy. If we do not sort the issues of investment and business development in the creative industries, we risk seriously eroding the UK’s competitive advantage in this area.”
Hutton also discussed the need for “hybrid finance” for the creative sector, consisting of an “equity and loan package”.
The event was hosted by Bristol-based South West Screen on 26 May. Eighty business angels, investors, entrepreneurs and public officials met to identify obstacles to growth in the creative industries, and to establish working groups tasked with driving forward practical solutions that can assist government, public support agencies and private investors in re-energising the UK economy.
The consensus of the day was that genuinely creative businesses often need other forms of support in addition to financial investment and that more importance needs to be given to finding a “common language” for creative entrepreneurs and investors.
Other observations thrown up during the day include:
• CI’s are thriving and entrepreneurial talent is abundant. There is a real opportunity to improve connectivity between businesses and investors;
• Difficulty in obtaining early stage investment is a widespread problem, yet the problem is rarely due to lack of access to finance alone. Often, relationship building is just as important, if not more so;
• A good network of private sector mentors is needed to guide companies when they receive public sector investment;
• Better connectivity of public and private expertise need to be developed outside of London;
• There is an inaccurate perception that the CI’s are less focused than other sectors and less serious about commercialism;
• Creative companies must move away from a dependency culture of reliance on grants, and move towards making better use of limited funds available;
• The UK has a cultural problem of not thinking ‘big’ enough compared to US counterparts;
• It is difficult to define ‘creative industries’, and it’s clear that one size cannot fit all;
• The challenge is to find a way of ‘pump-priming’ the CI ecosystem whilst ensuring businesses remain independent and forward thinking in a time when public funds are scarce;
• The sector would benefit from a comprehensive creative industries directory, to signpost new businesses to a full range of private and public investment opportunities;
• Investors should signpost unsuccessful companies towards ‘investment ready’ advice;
• Education improved from an earlier stage, in school and University curriculums. Entrepreneurship needs to go hand in hand with practical skills development.