Why businesses fail: Financial management

Welcome to the Why businesses fail series. This is the final instalment of the series that delves into the reasons for businesses failing and offering solutions. This series was launched by Lucy Robinson of Birkbeck Futures and Ghazala Zia from Windsor Swan. In this blog, they share why financial planning should be high on the list of priorities for new businesses and start ups.  

Lucy Robinson is the Employability Consultant for Business and Enterprise at Birkbeck Futures. She runs the Pioneer programme for aspiring and early-stage entrepreneurs and hosts an enterprise series on the #FuturesPodcast.

Ghazala Zia is a Venture Capital Advisor at Windsor Swan, a boutique London business advisory firm. She has an extensive legal background and currently specialises in advising start-ups of all stages on funding, strategy and business analysis.

Young businesses often prioritise hiring team members to focus on technology and sales. Obviously, these are very significant elements of the start-up, but neglecting the management of finances is a common reason businesses might fail.

A very common reason for a business failing is running out of money. Frequently, entrepreneurs will burn through cash to the brink and then be left with two to three months’ worth of cash, which is really unattractive to investors. This comes back to investors wanting to secure a return on investment and showing poor financial management makes you high-risk. Instead, having eight to twelve months’ worth of cash indicates that you’ve got time to grow your business and doesn’t come off as desperate.

In the beginning, having access to someone who performs a CFO-type function could be the difference between succeeding and failing. This doesn’t have to be a full-time team member if that’s not feasible, as this is a function that can be outsourced fairly easily. Essentially, this is someone to discuss how you allocate your costs, draw up your financial model, and manage your finances day-to-day for the business. Think about this before you receive funding, as they can also help you plan ahead. Showing investors that you’ve taken this initiative is also a big plus in terms of your trustworthiness.

The misconception is often that we don’t need to hire a CFO or shouldn’t spend money on this, as an accountant can perform the same function. Whilst accountants are great at what they do, their role is more about looking backwards than forwards. In essence, planning ahead financially isn’t exactly their purpose. When looking at the finances for your start-up, it’s speculative and forward-looking – largely making educated guesses. So, you need someone with this skill set, which is more likely to be a financial specialist who’s worked in start-ups before.

Read more from the Why Businesses Fail series:

 

Share
. Reply . Category: College . Tags: , , , , , ,

Why Businesses Fail: Business Plans & Financial Models

Welcome to the Why businesses fail series. This is the fourth of five blogs that delve into the reasons for businesses failing and offering solutions. This series was launched by Lucy Robinson of Birkbeck Futures and Ghazala Zia from Windsor Swan. In this blog, they share why having a carefully considered business plan is essential to the success of your business.  

Lucy Robinson is the Employability Consultant for Business and Enterprise at Birkbeck Futures. She runs the Pioneer programme for aspiring and early-stage entrepreneurs and hosts an enterprise series on the #FuturesPodcast.

Ghazala Zia is a Venture Capital Advisor at Windsor Swan, a boutique London business advisory firm. She has an extensive legal background, and currently specialises in advising start-ups of all stages on funding, strategy and business analysis.

We all know the importance of a decent pitch deck when it comes to presenting a business idea to investors, but ultimately, they’ll be looking at the detail behind the pitch when making their decisions. Once you’ve started your business and got a few customers, you should be looking at your business plan and preparing it for an investor. This seems early but is the right time because that’s how long it takes to prepare for investment.

Investors might not ask for a business plan straight away, often they’ll request to see this after a few meetings. Entrepreneurs often wait until they’re explicitly asked before creating a business plan, which isn’t setting yourself up for success.

In reality, a business plan is a living, breathing document, not just something you rustle up on request for the purpose of your funding application to an investor. Showing an investor, a rushed, poorly considered, or insufficiently detailed business plan won’t fill them with confidence.

A detailed and carefully considered business plan isn’t just important for impressing investors – it’s one of the most important tools in your arsenal as an entrepreneur, and when used correctly it can be incredibly valuable for planning ahead, making decisions and staying on track.

The business plan should work for the life cycle of the business, which is approximately 3-5 years. Consider the milestones you’ll reach and issues you’ll face within this timeframe. It should be a professionally written document that you and your team refer to time and time again, meaning that everyone is literally on the same page. It’s not static, and should be amended as you go along. This allows you the flexibility to adapt to new circumstances and continue planning ahead.

As well as your business plan, you also need a detailed, well-evidenced and realistic financial model. The first question to answer here is that of why your business needs funding in the first place. Where are you hoping the business will go in the next 3-5 years? What specifically will the funding be spent on? How have you arrived at these costs? How will the meeting of these needs lead to more growth and profit? Specificity is needed here, as investors awarding significant amounts of money will want to know exactly where that money is going, and how it contributes to their return on investment.

You also should be proportionate and realistic about the amount of funding you ask for. There’s no exact rule about how much funding to request, as it ultimately comes down to your planning, but you shouldn’t expect to waltz out of your first investment meeting with one million pounds. It’s speculative at the early stages, but you can come up with a good financial model that’s relevant to the type of investor you’re approaching if you take the time to look at the detail of your business. Seeking the guidance of a financial advisor is a good step to take here, as they’ll know the right questions to ask you.

When it comes to your business plan and financial model, sit down and spend a lot of time on these. This is why investors often prefer to back entrepreneurs who’ve already tried and failed, because they know the steps to take and the questions to ask themselves.

Read more from the Why Businesses Fail series:

 

Share
. Reply . Category: College . Tags: , , , , , ,

Pioneer Programme 2020: Meet the Finalists 

Meet the entrepreneurs in the running for the Best Business Pitch and Best Business Idea awards. Winners will be announced at a virtual ceremony in June. 

Picture of a lightbulb
As the government, businesses and individuals adapt to a “new normal” in the wake of COVID-19, the case for innovative thinking in the workplace has never been clearer. With this in mind, we’re delighted to introduce this year’s Pioneer Programme finalists.

Pioneer is an extra-curricular course for Birkbeck students looking to develop the knowledge and skills to excel as an entrepreneur. Over seven Saturday sessions, participants learn from a range of entrepreneurs, industry experts and each other to build the skills needed to develop their business idea or scale up an existing business. 

Representing the best entrepreneurial minds in Birkbeck, the finalists are in with a chance of winning either the Best Business Pitch or Best Business Idea award, each worth a £1000 cash prize to support their business, along with a bespoke package of mentoring, coaching and promotion. 

Participants’ achievements will be celebrated at a virtual awards ceremony on Thursday 18 June, with a panel of five independent judges, themselves entrepreneurs and industry leaders in start-ups and innovation. 

Meet the Finalists

Jody Halstead

Jody Halstead
MSc Management with Business Strategy and the Environment
Business: Circular Surrey 

My business, Circular Surrey, is a platform for local business leaders who want to transition to a low carbon circular economy. 

Research shows that more localised solutions are needed in order to make the shift to a low carbon circular economy. Alongside this, business owners and leaders often don’t have the resources to fully apply their time and need some additional support. 

The Purpose of Circular Surrey is to provide clear and tangible support for local businesses to enable them to shift to more sustainable business models and practices whilst continuing to power Surrey’s economy.

 

Alexander Flint Mitchell

Alexander Flint-Mitchell 
MSc Business Innovation (specialising in Entrepreneurship) 
Business: Blind Cupid 

Blind Cupid is for people who want lasting love and are frustrated by the time and money wasted dating incompatible people. Blind Cupid offers fast, fail-safe matchmaking. Unlike eHarmony and Hinge, our product matches users with people who share the same values and fundamental way of thinking via a never-before-used science. This creates a fast-track to lasting love. Far from the superficiality of Tinder, profile compatibility is scored and bios are seen before a user chooses which of their matches to reveal photos to. This leads to better dating decision-making. 

You can take Blind Cupid’s ‘Sense of Life’ Questionnaire today and get a very informative report about who you fundamentally are as a person.

I am currently fundraising for Blind Cupid and the product should be on the market within the next three months. 

 

Picture of James Shepherd

James Shepherd 
MSc Cognitive Neuroscience and Neuropsychology 
Business: Smart Therapy Tools  

Smart Therapy Tools aims to modernise psychological therapy treatment by providing both therapists and service users with an interactive and engaging smart phone app.  

Cognitive Behavioural Therapy (CBT), a therapy based on a structured understanding of how mental health issues maintain themselves, is at the forefront of modern mental health treatments and the NHS alone aims to treat over 1.5 million people a year with this approach. To improve the experience of this therapy, I have developed a prototype smartphone app which brings important techniques away from static pen and paper approaches into a more engaging and dynamic domain.

In the future, I aim to put data science at the heart of the app by using statistical modelling to learn from user inputs. As the app is used more often, more information from the heart of the service user/therapist collaboration can be utilised to help understand the complexity of mental health problems and inform new treatments.

 

Picture of Kevin Tsai
Kevin Tsai 
MSc Innovation and Entrepreneurship 
Business: Anywhere Bear 

Anywhere Bear is a vision born from my passion for travelling. However, I have come to realise how damaging air travel is for the environment – even a short haul flight from London to Edinburgh contributes more CO2 to the atmosphere then an individual’s average annual emissions. 

My wife and I recently took a holiday around Italy without flying and we loved the experience of travelling around by train.  We then looked at other holidays around Europe but found it difficult to plan without flying. There is no one go-to site that we trust and find easy to use for our needs, hence the decision to pursue the idea of a travel platform specialising in helping holiday makers to plan and book their holiday around Europe without flying. We want to build a fun and engaged community of people who will enjoy sharing their travel stories and be able to challenge and inspire their network to join them as they go flight free.  

Due to COVID-19we’ve had to rethink our strategy, as we foresee travel being impacted by this pandemic.  We’re now going to be providing travel inspiration to places around the UK.  We plan to partner with eco-hotels and restaurants and build a platform to allow people to still enjoy their holidays with a minimal carbon footprint.  

Our plan is still at the ideation stage so watch this space as we reinvent the way people holiday!

 

Picture of Hetty Bonney-MercerHetty Bonney-Mercer 
BA Global Politics and International Relations 
Business: FemInStyle Africa 

In the near future, representation of women in Ghana’s politics will be higher, women in Africa will be more financially independent, women who have broken the glass ceiling in their respective fields will be the norm instead of the exception, solo female travel will be safer and gender activism will have reached new heights. 

Because in 2019, two gender activists decided that there weren’t enough publications in the country that really focused on amplifying women’s voices exclusively and in a positive way and decided to do something about it. 

FemInStyle Africa is a magazine for women by women which aims to encourage women to live their full potential. We have five columns dedicated to politics, gender activism, profiling working women, financial advice and travel and style: always written with women as the central focus. FemInStyle Africa aims to mobilise women to bring about lasting changes in the fight for gender equality. 

We are currently building our website, recruiting writers, and finalising our marketing plan with a view to launching in Q3 2020. We welcome you to be a part of our journey.

 

picture of Mukesh Bhatt

Mukesh Bhatt 
PhD Law 
Business: inSTEAD – integrating Space Technologies into the lives of the Elderly and Disabled 

 The inSTEAD project wants to re-purpose, re-innovate and re-invigorate space technologies, which can be used to help the elderly and disabled. Over 700 astronauts in space and returning to Earth are supported by a multi-billion-dollar industry, prototyping and patenting health support and rehabilitation mechanisms. The astronauts suffer from the same health problems as the elderly and disabled on Earth, and yet solutions for the latter are priced beyond their reach. However, anything used by astronauts can also be used by the elderly and disabled because each is human. 

Encouraged by the Birkbeck Pioneer programme, the International Space University and the European Space Agency at its Noordwijk business incubation centre, inSTEAD (AbleSpace Paradigms) aims to translate the hardware and psychological technologies and methods used for astronauts into a form suitable for the support and rehabilitation of the elderly and disabled on Earth. 

The inSTEAD project includes in its mission both commercial and philanthropic aims and objectives for high social impact and making the best use of opportunities for collaboration with national space, technology and development agencies and initiatives. It requires a team of dedicated and impassioned personnel to help make it a success. If you wish to become involved please contact Mukesh. 

Further Information: 

Share
. Reply . Category: Business Economics and Informatics, College . Tags: , , , , , , , , , , , , , ,

I’m not looking for a career in accountancy, engineering or anything that needs Maths. Why do I need to think about my numeracy skills?

It’s National Numeracy Day 2020 on the 13 May and Birkbeck Futures takes a look at why numeracy skills are important no matter what career you choose.

Picture of dominoes

Many jobs that we typically don’t think involve numbers usually require some level of numeracy.

Being numerate means that you can confidently and effectively use mathematics to meet the everyday demands of life.

You may not be asked to solve complex equations, but you could be required to complete tasks that involve numeracy skills. For example, if you’re in Human Resources, you may be asked to provide a report on gender diversity figures. Similarly, if you’re in the Arts, you may need to put together a budget for an exhibition. Both of these require some level of numeracy.

The OECD reports that there is a direct relationship between wage distribution and numeracy skills. The better your numeracy skills, the greater your earning potential.

Why?

Because all those things you learnt in Maths help build the skills employers are looking for.

Employers aren’t just looking for technical skills and subject knowledge when they recruit someone. They need you to have employability skills – transferable skills that enable you to do the job successfully. For example:

Digital Skills

Digital skills are required in at least 82% of online advertised jobs across the UK.* We live in the digital age and as a result, we deal with more numerical data that we ever have before. You need good numeracy skills to be able to work with computers, otherwise you’re unable enter the right data or identify if the answer is in the right area.

Problem Solving

Problem solving skills are vital to any graduate level job. Maths is all about solving problems; take working out an equation for example. You need to pick out the important parts of the problem and then work out the knowledge required to solve it. This skill is transferable to solving any problem, mathematical or not.

Communication

When studying Maths, or working with numbers, you will have developed your ability to assimilate and communicate information in a clear and concise way. Everything we do in the workplace is a result of and requires communication of some kind.

Employers are increasingly using numeracy tests as part of recruitment processes.

As numeracy is such an important skill for employers, many use numerical reasoning tests as part of their recruitment processes. These types of assessments measure your ability to interpret, analyse and draw logical conclusions based on numerical data presented in graphs and tables.

Students can find out more about these tests and have a practice on the online Careers Portal (accessed through your My Birkbeck Profile).

But what if I’m not good with numbers?

We all have areas of ability that we feel more confident in than others. You might not think that you’re good with numbers because of experiences with Maths in school, for example. But chances are you’re much more competent than you think.

Our level of confidence often impacts our ability to take on new challenges or face up to things we may usually avoid doing. To reiterate the problem-solving example above, when we don’t know something, we can find out how to do it. Embrace your numeric abilities and enhance your skills to help boost your confidence in this area.

Birkbeck is supporting National Numeracy Day for the first time this year. Join the conversation on Twitter or see if you can build your everyday Maths confidence by taking the challenge.

Get in contact with Birkbeck Futures at employability@bbk.ac.uk or follow us on our social channels:

*Source: “No longer optional: Employer demands for digital skills” report – June 2019

Share
. Reply . Category: Business Economics and Informatics, College . Tags: , , , , , , , , , ,

Birkbeck, an energy you carry with you through your lifetime

Birkbeck alumna, Helen Kofler, writes about her work experience with the Birkbeck Futures team, after deciding she wanted to follow her passions and explore a career change.

As a Birkbeck masters graduate my most profound memory is of my graduation in 2015. I was sitting in the crowded auditorium and the familiar rumble of family members and friends cheering proudly for their loved ones, as they walked on stage to collect their hard-earned certificates, filled me with excitement and anticipation. I was sitting facing the stage on the right-hand side, so I saw the backs of students climbing the stage and only got to see their faces when they turned to face the audience.

One female student walked onto the stage and loud whistles and hands clapping in the sky charged throughout the audience. As I saw her turn to face me, her black gown was neatly folded around a baby carrier which she had strapped to her chest with her young toddler grinning out at the audience. For me this was everything Birkbeck stood for. The evening university which gives people the flexibility to study, whilst juggling the responsibilities of work, life and family.

So many of my contemporaries who have had children have had to turn to organisations such as ‘Pregnant, then Screwed’ when employers have discriminated against them for starting families, condemning their working lives. This woman on stage was looking that stereotype in the face and saying I am strong, I am powerful, I am intelligent and I am a mother. I was so proud to be a part of Birkbeck.

Having worked in retail in Marketing then as an Area Manager across London and the UK since 2010, I was exposed to the increasing pressure that has fallen on the UK retail market and decided it was time for me to leave the industry in search of new cheese. The only aspect of the job that I was sure I was committed to was working with, and developing, people. Through much soul searching and self-reflection I began to think about areas of my life which I enjoyed and where people were naturally drawn to me.

In the midst of this work on myself, my phone rang, “Helen, can I meet with you to help me prepare for a job interview?” “Yes!” I exclaimed. I hurriedly pored over the job spec and made a note of potential questions that could be asked. The next week, someone else called, “Helen, can we have a catch up, I am struggling at work and don’t know what my next move should be?” “Of course! Let’s go for a coffee.” This became a theme. I enjoyed so much meeting up with friends and colleagues and talking to them about career journeys but never considered it could be a full-time career itself.

Remembering my time at Birkbeck, I decided to contact the Birkbeck Futures team and ask for their advice. Even though I had graduated five years earlier, the door was flung open for me to discuss my situation with Lucy Crittenden, a Careers Consultant in the Futures team, where I was given bespoke advice and offered insight into creating a job out of my passion. An opportunity then arose for me to spend a week working alongside the team and seeing what they did on a day to day basis.

Excited and nervous, I made my way back to my old stomping ground ready for a week of learning. As I started the week, I have never come across such a generous and forward-thinking team. Spending a lot of my time with Jenna Davies, the Head of Careers, she took time out of her day to coach and mentor me. Jenna also shared her passion for entrepreneurship which I found truly inspiring and rubbed off on me giving me motivation to take side projects forward. Jenna organised a week full of interesting and fulfilling duties. These activities included research projects for Birkbeck’s inspiring Ability Programme, which is a series of lectures, workshops and networking opportunities dedicated to students and graduates with a disability, neurodivergence or long-term health conditions. I also attended training sessions and one to ones. Anna Gordon, Birkbeck Futures Career Coach helped me to reflect on my strengths and has given me a sense of purpose. Lucy Robinson, who is a Careers Consultant, gave me an insight into the Pioneer Programme, an initiative dedicated to encouraging students on their start up ideas. A week full of inspiration.

I have come away from my week at Birkbeck with that familiar sense of excitement and possibility that I was often filled with after having been to lectures and seminars as a student. Anna Gordon said that as a career changer it is important to have ‘resilience’ and I will carry this comment with me on my journey through career change. I am excited about the future and the opportunities ahead of me. I got the sense that there was a shared sense of community and purpose for each staff member that I came across. It was amazing to see as a spectator but also really infectious when surrounded by such energy.

At a lecture I attended towards the end of the week, Dr Rebecca Gumbrell-McCormick, Senior Lecturer in Management, said that Birkbeck is dedicated to inclusion and dedicated to giving people a second chance in life. The people I worked with during this week were testament to this and I am grateful to such an institution and these intrinsic values so imperative to our society today.

Further information:

Share
. Reply . Category: College . Tags: , ,

What is intrapreneurship and how can it help your career?

The life of an entrepreneur isn’t for everyone, but you can still reap the career benefits by embracing an enterprising spirit in the workplace.

Brainstorming, Business, Cheerful, Clap Hands

I don’t know about you, but a pretty clear picture springs to mind when I hear the word entrepreneur: suited and booted, firm handshake, these are the people who can talk to anyone, are interested in everything and have a remarkably persuasive knack of bringing people on board with their ideas.

While the risk-averse among us may want to steer clear of the career path of an entrepreneur, you might be surprised at how much there is to gain from embracing an entrepreneurial spirit from within an organisation.

That’s where intrapreneurs come in.

What is intrapreneurship?

Intrapreneurship involves developing the skills and mindset of an entrepreneur, but using these to benefit the company you currently work in, rather than starting up your own business.

Intrapreneurs are recognisable in organisations as the people who are confident, question how things are done and are willing to try new approaches in search of better outcomes.

What’s in it for you?

Adopting an enterprising attitude in the workplace might sound like a lot of hard work, but it’s a smart career move. Putting forward suggestions and championing new ideas allows you to put more of your own personality and interest into your role, making it ultimately more satisfying. We also know that increased autonomy at work is one of the keys to staying motivated.

Entrepreneurship develops skills that are transferable in any workplace, such as emotional intelligence, innovative thinking and leadership. Plus, any suggestions that you make and work on can be used as concrete examples of your achievements when you’re looking for your next opportunity.

What’s in it for your employer?

Although the concept of intrapreneurship has been around since the 70s, it’s becoming increasingly relevant in today’s world. Creative thinking, emotional intelligence and the ability to embrace and adapt to change, all key skills of an entrepreneur, are becoming essential in the modern workplace and are where humans differentiate themselves from artificial intelligence.

Employers value team members who are proactive, resilient and who can offer creative solutions to the challenges their business is facing.

Enterprise at Birkbeck

At Birkbeck, there are many ways to get involved with enterprise to suit any level of ability and time commitment.

  • Pioneer

Pioneer is a fantastic way to launch your enterprise journey, and applications for this year’s programme are now open. Birkbeck’s flagship enterprise course is open to Birkbeck students and recent graduates from any discipline who are looking to develop their entrepreneurial skills.

  • Workshops and Events

Birkbeck Futures host events throughout the year focusing on a different aspect of enterprise.

  • Courses in Enterprise

Birkbeck’s School of Business, Economics and Informatics has a strong reputation for research excellence and innovation and offers a range of programmes where students can prepare themselves for the modern workplace.

Share
. Reply . Category: Business Economics and Informatics, College . Tags: , , , , , , , , , , , , , ,