Driving Investment: The Missing Piece to your Investment Portfolio?

This blog was contributed by BSc Financial Economics student Paul Talbot and was originally written as an assignment for the module Quantitative Techniques for Applied Economics.

Picture of a classic car

Classic cars, an alternative investment that is rarely discussed when investors are looking for a strategy to increase ROI in their portfolios. Some prestige classic cars have increased over 400% in the last decade[1], but what sets these assets apart from status quo investing?

“Stories. That to me is the answer. Every car has its own history, its own adventures, its own japes and probably plenty of scrapes. Tales to be told and shared with fellow enthusiasts. Few other asset classes, however valuable or beautiful, can match it”[2]

The majority of investors would not be able to afford a 1960 Ferrari 250 GT, but investment growth has been seen across the majority of the classic car market. A more affordable sector is British classic cars, iconic cars such as the Jaguar E-Type or the Triumph TR6 has yielded over 50% returns since 2007, outpacing the heavyweight UK asset classes.

Graph showing price indices of UK classic cars

The classic car market also benefits from a favourable tax status, investors do not pay capital gains tax on profits as they are classed as “Wasting Assets” by HRMC. Movable assets such as classic cars can be gifted to family members, if no benefit is retained or lent, or for a period each year, to a car museum to avoid paying inheritance tax on death. If you intend to enjoy your investment on the road, they are also exempt from road tax and a MOT.

Tax relief of 20% on investment gains already drives these assets ahead of other financial instruments and it is no surprise that this is attracting some attention. The classic car market added significant gains to the UK economy last year[3] and is expected to continue grow from £940 Million in 2019 to £1.65 Billion in 2023.

Graph showing projected UK classic car market

Investing in classic cars does not come without a few speed bumps, it is not a case of purchasing any car and hiding it away for many years. Paul Michaels of Hexagon Classics notes “The very best cars — meaning those with full histories in exceptional condition, either completely restored or lovingly maintained with some age-related patina — will always command the highest prices.”

It is always advisable to get an expert opinion and the history authenticated before purchasing your investment and continue to keep your new asset lovingly maintained and stored away from the elements. All the above will add an upfront and annual running cost to purchasing the investment, reducing overall yield, but in turn, the better the asset is maintained and stored, the higher possibility of future gains.

The average global investment portfolio last year contained only 4% of luxury investments, this includes fine wines, collectable coins, art, jewellery and classic cars to name a few[4]. With climate change at the forefront of government polices banning the sale of petrol/diesel cars by 2030 and the rise of autonomous vehicles, will only make these investment stars a rarer commodity.

Pie chart showing global average asset allocation.

With central banks flooding the markets with liquidity, artificially supporting equities and driving down bond yields, parking a little piece of history in your garage and diversifying your portfolio will not only provide the perfect inflation and market correction hedge, but you may have some fun along the way.

Next time you look at your annual investment report, the immortal words of Wilbur Shaw may spring to mind.

“Gentleman, start your engines”

Further Information

[1] https://www.hagerty.com/apps/valuationtools/market-trends/collector-indexes/Ferrari

[2] HRH Prince Michael of Kent interview with Knight Frank November 2020

[3] FBHVC National Historic Vehicle Survey – https://www.britishmotorvehicles.com/news/fbhvc-national-historic-vehicle-survey-reveals-significant-contribution-to-uk-economy

[4]The Attitudes Survey is based on responses from 600 private bankers and wealth advisers managing

over US$3 trillion of wealth for UHNWI clients. The survey was taken during October and November 2018

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Around the world in an MBA

Marketing Manager and MBA student Lorena Ramirez shares her journey on the MBA, across three continents and what she has learned along the way.

Picture of Lorena Ramirez

The first time I heard about the Central Saint Martins Birkbeck MBA was while living in Peru. I’d been working in the fashion industry for the last ten years and was ready to expand into different creative areas. I was looking for a Masters degree that focused not only on fashion, but on creativity and innovation.

There are lots of really good MBAs in London, but the Central Saint Martins Birkbeck MBA was different. There is nothing else in the market that mixes art, design, business and social innovation in that way.

I fell in love with the course immediately, but attending face-to-face sessions in London wasn’t an option for me, so I was forced to put my plans on hold.

Moving to London

It just so happened that, months after discovering the MBA, my husband was offered a job in the UK. We moved to London without any hesitation: I arrived, found a job, got pregnant and applied for the MBA! I had my interview with Dr Pamela Yeow, the Course Leader, about a week before I gave birth.

I had my reservations about starting a Masters with a newborn baby, but when I won a scholarship for the course I felt like it was a sign to just do it. I started the programme and absolutely loved it. On a course like this, it’s so important that your peers are with you on this journey. For a lot of MBAs, the average age is around 24 or 25. I’m 37, and while the youngest person in our cohort was 25, the oldest was 60. Through the MBA, I met people in media, television, different organisations and entrepreneurs. The diversity of ages and interests in my cohort was what I enjoyed most about the experience.

Then my maternity leave finished, the pandemic hit and I found myself working full-time with a baby under highly pressured circumstances. Sadly, I couldn’t continue the MBA with my cohort, but Birkbeck and Central Saint Martins were very understanding and supportive. It was not an easy decision, but looking back, I think it was the right one. I wouldn’t have had the time to properly enjoy the reading and the learning process if I had continued then.

Picture of Lorena with her son

Recognise this scenario? Lorena trying to work and study, featuring her son Noah.

A new challenge in Ceuta

Despite having to put my studies on hold, this has been a whirlwind year: I was promoted to Marketing Manager for Spain for my organisation and relocated to Ceuta, an autonomous Spanish city in Morocco. Ceuta is a small, quiet city, so it’s a big change from London!

In my new role, I am already applying the learning from the first module of the MBA, which is all about how to solve complex problems. Right now, in Spain, the gambling industry is facing new marketing regulations which drastically change the way it has worked for the past twelve years. This has a huge impact on our work, meaning we have to really think outside the box when it comes to promotion.

Changing the way an entire company works is very difficult, especially when you lead teams. For me, the MBA was the perfect preparation to face this challenge. On the course, we completed a project with the London Ambulance Service – what we are learning is not theoretical, it’s real life, day by day. In my work now, we essentially have to reinvent all the departments and how we’re working. For this to be a success, you have to change the way of thinking not of the directors but of the users and your team, and that is the most difficult thing. I’m grateful to have had the opportunity to study to have a preparation to understand this better.

Where next?

From March 2021, I’ll be travelling to London once a month to re-join the MBA programme – I can’t wait to get started again!

In the long term, I would like to go back to sustainable fashion, for which my current experience in online marketing will be really valuable. I’d like to work with artisans, especially Peruvian artisans, linking them with brands across the globe. Most artisans around the world don’t speak Spanish or English, so it can be difficult to reach them, but I hope to do this through a foundation or social enterprise – I think the MBA will lead me to the right way to do this.

Further Information

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Making a difference in the local community: learning from the Central Saint Martins Birkbeck MBA

With over thirty years’ experience working in his local authority, Eubert Malcolm brought a wealth of knowledge to the classroom. Having just been promoted to Assistant Director for Stronger and Safer Communities, he reflects on how the MBA has supported him to make a positive difference.

Picture of Eubert Malcolm

As local authority leaders go, Eubert Malcolm must be among the most personally invested in his community.

“Somebody said to me the other day that I’ve been in Haringey from boy to man,” he laughs, but with over thirty years’ experience in various roles in the local authority, this isn’t far from the truth. Eubert joined Haringey Council as an environmental health officer apprentice in 1988. From there, his role expanded into different fields as his skillset developed, encompassing housing, food safety and pollution.

“I made my way up the local authority and picked up Diplomas in Environmental Health and Management Studies along the way,” explains Eubert, “but I always felt that not having a first degree would hinder me at some point.”

The value of life experience

It was during the hunt for an undergraduate degree that Eubert stumbled across the Central Saint Martins Birkbeck MBA. The idea of studying part-time at the weekends was a particular draw, but was it really possible to do a Masters level programme without an undergraduate degree?

“I went along to the open evening without much hope,” says Eubert, “but I really liked the course leaders and they encouraged me to apply. I think I was the least qualified but most experienced of that first cohort, and the idea of a co-production and developing new types of leaders seemed perfect for my role. It felt like I was in the right place at the right time.”

Seeing things differently

The collaboration between Central Saint Martins and Birkbeck’s School of Business, Economics and Informatics offers an innovative perspective on businesses and the problems they face. This, combined with the diverse international cohort on the MBA, gives students an opportunity to look at situations from a fresh angle. For Eubert, this proved invaluable when looking for ways to connect with the local community:

“When I first started the MBA, there was lots of gang activity and a spate of deaths in the community. I wanted to learn more about how violence was affecting young people in Haringey, so I commissioned a community group to speak to them and to people in prisons to figure out the drivers of criminality. Until you actually sit down with young people and hear from them, their teachers and their parents, you don’t really understand the challenges that they are facing. We need to engage with them and ensure that they are part of the solution.”

Eubert’s MBA dissertation was Haringey’s public health approach to tackling serious youth violence, a combination of academic research and an in-depth evidence base that came from his experience in the local authority, which informed the young people at risk strategy.

“At Haringey, we want to co-produce strategies with the community,” he explains. “Now, we’re incorporating business principles into our local authority point of view and using action learning techniques to think issues through from beginning to end, predicting the challenges we might need to address along the way. It’s an approach the managers I work with are now also starting to adopt.”

Leading in the pandemic

The rapid unfolding of events in the COVID-19 pandemic has made an agile approach essential:

“If you look at how much COVID-19 has cost local authorities,” says Eubert, “I don’t think we’re going to be fully recompensed for that. It has made us look at what opportunities could come out of it instead.

“For example, we couldn’t deliver a lot of our face to face services during the pandemic and many of them went online. We found that the young people we work with instantly took to that approach, which we hadn’t really considered before.”

Now Eubert, his team and the wider council are working on campaigns to bring the local community together to reduce the spread of COVID-19: “The approach we’re taking, trying to get right to the hearts and minds of people in the borough, is something I don’t think we would have attempted before. It just goes to show that with the right support and network in the workplace, you can be successful even through challenging times. I know that anything I set my mind to I will be able to achieve.”

Further Information

 

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What’s the best way to raise funds for a startup?

Alexander Flint Mitchell, MSc Business Innovation with Entrepreneurship alumnus and founder of Blind Cupid shares his experience of raising capital for his business venture.

Picture of business man launching into the air.

Like most first-time entrepreneurs, Alexander was a total novice when it came to funding startups before setting up his own business.

Having now secured £175,000 to launch, with the prospect of completing fundraising over the next six weeks, he shares his experience of raising capital for a startup.

Angels and venture capital

When Alexander began fundraising for Blind Cupid, a matchmaking app that uses systematic philosophy and artificial intelligence to match users based on their fundamental values, he took a traditional route of approaching angels (high net worth individuals who provide financial backing for startups) and venture capital firms.

“We contacted many venture capital companies and had some very successful conversations with them,” explains Alexander. “These companies are usually specialists in a certain field and it’s common to be asked to deliver as many as five or six presentations to secure funding. While we would obviously spend some of this time talking about the business idea, the key thing to get right was the financial information.”

The downside of this method of fundraising? Time.

“Venture capital funders are demanding and even getting a response from them, never mind retaining their interest, requires a lot of time and effort,” explains Alexander. “There’s a lot of back and forth, often with your whole team needing to attend calls or presentations, which can feel never-ending when you’re in it.

“We also faced difficulties with our product not fitting neatly into a specialist area. The app we’re developing combines matchmaking with brand new artificial intelligence that has never been built before, and so there are no investors currently specialising in it. Given the amount of money that venture capital funds invest, it’s understandable that they would prefer to go with something tried and tested. We raised around half the funds we needed through this method, but I began to look for alternatives to speed things up.”

Gaining crowd appeal

Many different methods of fundraising are covered in the Entrepreneurial Venture Creation module taught at Birkbeck, among them crowdfunding.

Alexander admits to being sceptical to this approach: “I had the impression when I started that crowdfunding was on a smaller scale and more about conventional ideas than disruptive new businesses – I had no idea that companies do their series A and series B rounds on crowdfunding.”

While individual investment amounts can be much smaller, as little as £10, on crowdfunding sites, Alexander now sees this as an opportunity:

“Compared to venture capital, crowdfunding is a really quick and innovative way to finance startups,” he says. “The main difference is that our investors through crowdfunding are likely to also be our users, which is really exciting. Even if they only invest a tiny amount, they will benefit from a future IPO – it’s similar to holding shares in the stock market.”

The personal touch is also something that appeals to Alexander and the ethos of Blind Cupid:

“We aren’t just trying to match people together; we really want to make sure that these matches are accurate and that once you meet someone you will stay together. We’ve done it for 80% of our beta test users, and now we want to do it throughout the rest of the UK and world. It’s an unusual business concept in a way, because we don’t want people to come back – we want people to find the person that’s right for them.

“Our business model is very different from other players in this market because of this — and other reasons. We offer a premium service which gives our users access to podcasts, blogs and more written by experts that advise them on every aspect of their lives. Topics include how to discover who you really are, what self esteem is and how to build it, how to nurture a healthy relationship and more.”

Blind Cupid have now launched their crowdfunding campaign on Crowdcube. For Alexander, it will be a relief to move to the next stage:

“When you’re looking for funding, it feels like it’s never-ending, but I know that when it’s complete I‘ll forget the months that it took. Many things in life are a learning curve and you find what suits you best. It’s great to finally see it all come to life.”

Further information

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How to ask your employer for sponsorship

Picture of a man holding a piggy bank.

If you’re in employment and have a place to study on one of our programmes, you may be eligible for employer sponsorship.

Employer sponsorship is when your employer pays for all or part of your tuition costs. This is usually in recognition of the fact that your studies will benefit your work in some way.

For many of our students, a Birkbeck degree allows them to seek a promotion or to perform their role more effectively. Here’s how to discuss your educational ambitions with your employer.

Find out what’s available in your organisation

Before approaching your line manager about sponsorship, do your homework so you know what definitely is or isn’t available.

Larger firms may have established sponsorship schemes with an application process, while others may operate on a case by case basis.

If you can’t find anything on your company website, your HR learning and development lead will be able to help.

Consider your motivations for study

Take some time to think about why you want to study your chosen course. Will it help you develop the skills to perform a technical aspect of your role? Will it provide a theoretical underpinning to help you manage complex problems? Will you gain a broader understanding of how to differentiate your organisation in the sector?

Once you have a clear understanding of why you want to study this particular course, it will be easier to translate this into reasons why your employer should be interested.

Demonstrate the business case

To secure employer sponsorship, you will need to show the positive return on investment it will provide for your employer. Perhaps the skills you gain in the course will enable you to apply for a promotion and stay with the company for longer. Developing your knowledge of an area of the business might make you more efficient, enabling you to take on more responsibility. Link the programme description to objectives in your current role to show the direct value for your employer.

Show your commitment to learning and development

What have you already done as part of your continuous professional development (CPD) that can show your commitment to your career? It could be as simple as reading around the subject, attending a webinar or signing up for in-house training. Your employer will want to be confident that you will make the most of the opportunity that they are investing in.

What if I can’t get sponsorship?

Employers often have limited budgets available for staff learning and development, so don’t be disheartened if you’re unable to secure funding. Having demonstrated your commitment to your professional development and to the organisation, it is worth asking whether there are any alternative opportunities for you to develop your skills, such as shadowing another employee.

You can also find more information about what alternative financial support is available for our students on the Birkbeck website.

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Finding balance and fulfilment through the Central Saint Martins Birkbeck MBA

Before she found the Central Saint Martins Birkbeck MBA, Jennifer Chen felt that a business degree would not be a good fit for her background as a creative. Now juggling the roles of design researcher, charity trustee, Royal Society of Arts fellow, start-up mentor and mum to twin toddlers, she’s embracing new challenges and learning to balance all areas of life more than ever.

Picture of Jenn

My background is in design and advertising. As a creative, I found the work interesting, but from time to time felt a lack of control to make greater impact with my work. The agency setting I was in was rather fragmented and figuring out the why of the projects I was working on was usually someone else’s job. There were times when I would be given a task that didn’t feel quite right, but I did not have the capability or confidence to challenge it. My role was sometimes limited to form-giving, styling, making things look pretty – there is a lot of skill to that, of course, but I knew that I wanted to do more.

I began by searching for Masters programmes in innovation. I didn’t consider business programmes at first because I didn’t think they would be the right fit for me: of my friends with MBAs, as successful as they were, none of them had a job description that sounded like something I’d want to do.

I was delighted when I found out about the Central Saint Martins Birkbeck MBA. Working in the design community, I had always known about UAL, but Birkbeck’s strong research reputation gives the MBA more credibility in the business world.

From the very beginning, we were told that this was a safe space to share ideas, and that there were no stupid questions – I don’t think this is common practice in traditional MBA programmes. We learned from a team of excellent lecturers and industry leaders, but most importantly, from each other. As a more mature cohort with work and family commitments, we learned to plan for contingencies, to make sure colleagues could contribute to group projects regardless of their personal circumstances, and to be empathetic towards each other’s situations. We operated under the assumption that everybody wants to do their absolute best, but a bit of flexibility may be required here and there.

This was particularly true for me, since on the very first day of the programme I found out that I was pregnant with twins! It was almost surreal. My MBA cohort heard the news before some of my family. Birkbeck and UAL were very accommodating. To maximise my learning opportunities, Dr Pamela Yeow, the course leader, advised that I complete the first module, then helped me rejoin the programme a year later with the following cohort.

Picture of Jenn with her twins

Jennifer with her twins after rejoining the MBA in 2018.

Even then, balancing work and family life was not easy, especially as the estimated ten hours of reading per week turned out to be quite an understatement! Towards the end of the programme, we had all nearly become experts in information extraction and priority management.

The course was a transformative experience for me. Through theory and practice, I was able to develop my skillset as a design leader, especially in the areas of collaborative leadership, entrepreneurship and operations management. Having access to industry-specific knowledge and concrete, actionable advice from the teaching staff has really helped me get closer to achieving my goals: affecting change to the world through design.

Chris Cornell, our lecturer on strategy, who has worked extensively with the charity sector, helped me work out a clear action plan. I am now a marketing trustee for the Heritage Crafts Association, refreshing the brand to create a contemporary, engaging and relatable identity in order to attract a wider audience. I also mentor startups, helping their world-changing ideas cultivate the power of storytelling and develop clear communication approaches.

The MBA makes you ask a lot of questions about the work that you do, the work that you want to do, and the work that you can learn to do, in order to implement change and improve the world around us, and in doing so, enrich ourselves.

Further Information:

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“I cannot stress enough how important it is to get women a seat at the table.”

Winner of Best Business Idea at this year’s Pioneer Awards, Hetty Bonney-Mercer shares how she plans to empower women in Ghana with her business, FemInStyle Africa.

Picture of Hetty Bonner Mercer

A great business idea begins when someone identifies a problem that needs solving. Sometimes, these are problems you never knew you had, as the buyers of products like these will testify.

In Hetty Bonney-Mercer’s case, however, the business idea came from a problem she found impossible to ignore. Taking home the Best Business Idea prize at this year’s Pioneer awards, it looks like the judging panel agreed.

FemInStyle Africa is a magazine for women, by women, encouraging them to live their lives to their full potential. The idea for the magazine came from a desire to present an alternative narrative for women in Ghana.

As Hetty explains, “I first had the idea when I was part of a group of women whose gender activism took Ghana by storm in 2017.” The group wanted to flip the script on toxic gender narratives, but they weren’t able to do so without resistance: “The more politicised we became, the more backlash we received. Despite being a population with an equal gender split, the idea of women occupying media spaces was unacceptable.

“In Ghana, the traditional view that the role of women is to keep the home still persists. Just 13% of national politicians are female, and when a woman is given a platform on events such as International Women’s Day, it is always a certain type of narrative being pushed; that keeping a home and a husband is the most important thing, no matter what a woman has achieved. On International Menstrual Hygiene Day, the topic was discussed by an all-male panel!

“My co-founder and I realised that we needed to create a space where we could amplify the voices and experiences of women exclusively. We wanted to change a narrative that is harming future generations of girls.”

Hetty had been working on the early stages of her business idea when she saw an email from Birkbeck about the Pioneer programme.

“I thought that this was the opportunity I needed to develop the business. I sent it to my co-founder and she encouraged me to go for it.

“I gained so much from the programme: I made some really great friends and received incredible support from the speakers and fellow students. It was amazing to be in a room filled with so much passion: everyone there had a problem to solve. Coming from a background in Politics and International Relations, I learned the practicalities of running a business from some amazing female entrepreneurs who spoke on the programme.”

The FemInStyle Africa magazine website is currently under construction and will feature five columns: politics, gender activism, working women, financial advice and travel and style. The target readership is women aged 16-45, although Hetty wants the magazine to be read as widely as possible: “We want sixteen-year-olds to read the politics column or our profile of working women and see women who they’ll aspire to be like. For more mature readers, we want them to read something and see their own experience and values reflected. We want young people to see the possibilities of what could be, despite the societal pressures around them.”

The online magazine is a starting point, but Hetty’s vision for FemInStyle Africa extends much further. “We’ve set ourselves a six-month deadline to produce the magazine in print as well. In Ghana, data is a matter of class. Not everyone can afford to be online. We’re hoping to make the magazine free to reach as many people as we can.”

There are also plans in place to establish a mentoring programme alongside the magazine, providing further opportunities to empower young Ghanaian women. It is a project close to Hetty’s heart: “I cannot stress enough how important it is to get women a seat at the table. We want women to come on this journey with us and see that their futures are not pre-determined.”

Further Information:

 

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“It’s crazy to think that an idea I had when I was 21 is now my full-time job.”

Alexander Flint Mitchell took home the prize for Best Business Pitch in June’s Pioneer awards. He reflects on a life-changing year of building his business, Blind Cupid.

Picture of Alexander Flint Mitchell

When Alexander Flint Mitchell enrolled onto Birkbeck’s MSc Business Innovation last September, it was with a view to changing career direction and developing the business idea that had been on his mind for the last five years.

Handing in his notice just one month later, you could say things had moved a little faster than expected. “Looking back on it, that was probably a bit naïve,” Alexander admits, “but if you want to achieve something big, you’ve sometimes got to take a leap into the unknown.”

The motivation for this leap of faith? A little idea for an app called Blind Cupid.

Blind Cupid is a dating app with a difference, using a never-before-used science to match people based on their fundamental values, giving users the chance to see bios and compatibility scores before they reveal pictures to potential matches.

“A lot of dating apps claim to be all about personality,” says Alexander, “but it’s really just a slogan. In their questionnaires, they will ask about polarising issues like politics, which is valid, but simply agreeing on something doesn’t mean that you’re compatible. Take Brexit, for example: people voted Leave on both extremes of the political spectrum. It’s essential to understand the rationale behind the belief.

“The questionnaire that we use for Blind Cupid goes right to basic principles. The greatest feedback we have received so far from users is that they could see the value in the product even from just filling out the questionnaire – before they’d received any matches. When we tested the product, 80% of the test group went on four or more dates with their matches – that’s way higher than anything else in the market.”

Was the concept for the app born out of Alexander’s personal experience? “People ask me that a lot,” he says, “but in reality, the idea just came to me in a lightbulb moment, fully formed. I came up with the concept aged 21, while studying Law and working in the City. I found the reality of being a lawyer very boring and would end up spending most of the day daydreaming about this app. I knew that I was going to do it eventually, but I wanted to do it properly.”

In 2019, Alexander applied for the MSc Business Innovation at Birkbeck, specialising in entrepreneurship. “Studying in the evening meant that I could continue working in the City until the business was up and running,” Alexander explains. “I thought that, worst case scenario, I could find a role in venture capital, but I really wanted to give Blind Cupid a go.

“The course was everything I wanted to learn. One of the early modules, Entrepreneurial Venture Creation, required us to write a business plan. I wrote a business plan for Blind Cupid, and that’s when I decided to quit my job.”

As Alexander worked through the masters and the Pioneer programme, his business and networks grew. “I’ve made some amazing connections and put together a dedicated team – we’d meet at 8am and still be working together at 1am, before we were earning any money to do it, which just shows the commitment we all have to the business.”

Alexander’s Pioneer experience culminated in June’s virtual awards ceremony, where he took home the award for Best Business Pitch. “It was a shame not to be able to do the finale in person, but I was really surprised and pleased by how many people came along to the virtual ceremony. When pitching Blind Cupid to investors, it usually takes a full hour to go into all the detail, so drilling it down to three minutes was a real challenge. I’m thrilled to have won the Best Business Pitch award; it feels like all the hard work is paying off.”

Alexander is currently fundraising for Blind Cupid, with the aim of getting the product on the market within the next three months. Encouragingly, it seems that he’s also hit on an idea that can withstand the current tough economic conditions: “Strangely enough, the dating industry is booming at the moment. Regardless of what’s happening in the economy, people have a natural desire to have someone in their lives romantically, and that doesn’t go away in a recession.

“The decision to do the master’s was a life-changing, life-affirming decision. It’s crazy to think that the idea that I had when I was 21 is now my full-time job.”

Further Information

 

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New (and not so new) perspectives about humour and management

Juan Dávila, BA Global Politics and International Relations alumnus (returning to Birkbeck to undertake an LLM in the next academic year), discusses resilience, virtual socialisation and productivity in these challenging times.

In the last decades much had been written about the relationship between humour and good management. Still, considering the current global pandemic crisis originated with COVID-19, it is necessary to revisit a few key concepts that help us to contribute to the preservation of the right spirit and motivation in our organisations. After all, institutions, either seeking profit or not, are human constructions, and human nature is and has always been resilient.

Having said this, hundreds of thousands of original videos were produced in the last months, proving that self-isolation can be positively a time of self-discovery, where humour is a crucial element to enhance mental health and to deal with constant mediatic bombarding. Like Roberto Benigni in ‘La vita è bella’, people use their creativity and imagination under the worse circumstances.

Furthermore, a beneficial link between laughter and the boost of the immunological system had been traced as a result in scientific studies, since when we laugh our body produces substances like endorphins, adrenaline, serotonin, and dopamine that helps to relax our muscles and potentiate a feeling on mindfulness.

Once again, institutions, profit and non-profit, have in the last months made radical efforts to adapt their operations to the new circumstances affecting all type of practices and routines. Stress and anxiety are common symptoms that can later change the core of the organisation if they are not dealt with collectively. The challenges are indeed enormous, but also opportunities to be embraced.

But how can we apply humour to motivate our work environment? Like in any human interaction, speakers and listeners produce and exchange verbal and non-verbal communication. The effectiveness of communication is the base to reach mutual understanding. In that context, humour is an exciting tool to be used organically. Our difference with previous generations is that in times of social distance, much of our daily interaction is done online through devices that can, fortunately, allow us to retransmit image and voice in real-time.

In terms of effective communication, being funny is always about taking risks, considering the timing and other people points of view—also, project confidence and intellectual agility. Co-workers can eventually feel stimulated to work with someone that knows how de-dramatise the complexity of some operations. But, inappropriate jokes and remarks can undoubtedly cause the contrary effect and can eventually evidence incompetency. In any case, teamwork and good peer feedback are encouraged to safeguard fluent and effective communication, that at the end impact on the work environment.

When the dog is barking, or a child is crying in the middle of an urgent conference call, some things are indeed beyond our control. We have all been in similar situations. In these circumstances, a laugh can help to humanise these kinds of situations. It is essential to always take into consideration that the best humour is still coming from laughing about ourselves. In this context, leaders with a sense of humour are more approachable, helping to build up trust and boost the morale of the team.

Simple team building dynamics can also motivate people and encourage productivity. Here some tips and ideas:

  • If you want to keep your privacy at home, make sure that you use a professional virtual background. You can have a few of them to change accordingly to the situation.
  • You can all agree to wear a particular colour or dress code to attend a meeting. For example: ‘Red on Tuesday, and Green on Fridays’
  • Celebrate small steps or achievements is also a way to show appreciation to your colleagues.
  • Sharing ideas about what to do during social distance can also help to motivate people.
  • When working with colleagues in different time zones, it is vital to empathise. It could be the beginning or the end of the day for them
  • Also, working with people using different languages, it is crucial to formulate ideas and questions using simple vocabulary to facilitate understanding.

Moreover, being positive will not guarantee to succeed, but being negative will ensure that you will not. So, let us be the reason why someone smiles today.

Further information:

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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:

 

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