In Business All New

Innovation is easy to praise and hard to do. Britain is very good indeed at having ideas. We have huge success winning Nobel prizes and writing university research papers, producing far more theoretical stuff per head than almost any other nation.

Then comes the difficulty. The figures show that the UK has inordinate trouble trying to turn ideas into viable businesses. Something fails in the journey from the lab to the corporate HQ.

We have lost the art or craft of being an innovation nation.

For example everyone knows that Cambridge--city and university-is electric with ideas. Spend an evening with the aspiring entrepreneurs in and around the university and you will reel home relishing the excitement of it all. And, yes, Cambridge is the centre of Silicon Fen, a hotbed of start-ups-13-hundred of them in the past 25 years. It's wonderful.

But it is also small scale. British start-ups find it fairly easy to grow to Ł100-million in turnover. But even so they may be employing only 50 or 100 people..these are scalable businesses which don't need production lines or manufacturing to get to that size with their ideas and their software.

But then comes the exhaustion. Eventually, the great ideas, the intellectual property, are sold off to a predator, often from overseas. The founders and backers get rich, and cycle round Cambridge interfering in things.

But where are the Googles and the Hewlett-Packards and the IBMs of Britain ? British entrepreneurs seem to lack the spark of genius to scale up their business to become really big. And British planning regulations make it unlikely that it would ever be allowed anywhere near Cambridge.

British financiers may also be underpowered; they seem to want easy exits, rather than keep on backing a company with the promise of long-term growth within it.

British university entrepreneurs tend to sell out after five or ten years, and then have a nice life trying to spot other start ups they can act as mentors for.

This keeps innovation bubbling along at our universities and other clusters in an eye-catching way. It produces great stories. But it does little to transform the British economy from a post-industrial one into a high technology powerhouse.

This week's programme hears from people who argue that this can happen here: that innovation is a very important way out of the lengthening shadows of the current nasty recession. It is a bold and impressive argument; and counterintuitive for many big companies who instinctively lower their risk profile as soon as the gales of recession howl.

But the innovators are out there. The other morning I dropped in on one of the London meetings of something called OpenCoffee Club, founded by a returnee London serial entrepreneur called Saul Klein two years ago. It's a meeting place for people who love start-ups, and it is now in more than 80 different cities worldwide.

It's supposed to be less opportunistic than First Tuesday used to be in the era of the dot-com bubble. Coffee Club attenders are there for mutual support and story telling, rather than on the hunt for finance, though of course that may materialise.

The atmosphere of the one I went to is intense and noisy, and the Clubbers are fluent and full of their ideas, enormously plausible. They genuinely do not seem daunted by the idea of starting up a business in the middle of a global recession.

Are they simply foolish? I don't think so. Angel investment groups tell me that would-be investors are lining up to join the angel clubs. With the stock market still too risky and interest rates uninteresting, would-be angels feel that they may as well take a punt on an investment they can stare in the eyes, argue with, and maybe even contribute help and advice to, as well as financial backing.

This sort of enthusiasm is heartening, especially when set against the daily tattoo of grim news from other parts of the world of business. But whether this rush of innovation really means that Britain is finally getting its entrepreneurial act together, I have absolutely no idea.

Previous Programmes

Watch Your Language - Peter Day joins a group of enthusiasts determined to improve the language of business.

Keep it Local - As pubs struggle to survive, Peter Day travels through villages in Yorkshire and Cumbria to talk to local activists.

Space - Peter Day asks what happens next on the USA's journey into space.

German Pencils - Peter Day asks Faber-Castell and Staedtler how they both stay sharp ...

Building BRICS - Peter Day finds out about the BRICS - Brazil, Russia, Indonesia and China

Over A Barrel - Peter Day contemplates the turmoil in the Middle East and fears it will affect the price of oil

Reconstructing Capitalism - Peter Day hears all about the challenges to the way capitalism works.

All at Sea - Peter Day hears all about sea transport.

China Dispossessed - Peter Day hears about some of the problems caused by China's rush for prosperity.

Back on the Road - Alan Mulally tells Peter Day how he changed the way Ford works and how it is now back in the business of selling cars.

Asia Bling! - Peter Day ponders how the rise of the Asian comsumer will change business.

Euro on the Rocks - Peter Day asks what is the future for the Euro?

Bitter Pills - Peter Day looks at changing face of drug development.

Operation Robot - would you allow a robot to operate on you? Peter Day looks at robot-assisted surgery.

Growing Pains - Peter Day asks, what is the main component of growth?

After the Crunch - Government funding and regional development: the view from Newcastle.

Chips off the Old Block - Computing in the UK, past, present and future.

Hidden Depths - Graham Hawkes, DeepFlight and exploring the oceans.

Sociability - How social technology makes new business models possible.

Are CEOs Up to the Job? - Two thirds aren't according to Xinfu's Steve Tappin. Peter Day investigates.

In at the Start - Saeed Amidi and Silicon Valley

Power Play - Is the 'smart grid' the start of something big?

Now Wash Your Hands Please - How a simple idea can transform lives in the developing world

Coming Soon - What can the experience of previous financial crises tell us about the current one?

Ticking Over - Can the Isle of Man rejuvenate the business of watchmaking?

Not Just Silicon - what can Silicon Valley teach us about innovation?

Press under Pressure - what lies ahead for the world of newspaper publishing?

Remembering CK Prahalad - in a world of change and multiple opportunities, how does a company keep up?

Rwanda Rising - building a clean safe state where business can flourish.

Life Cycles - building businesses around the idea of new kinds of bikes.

Who Sets Our Standards - the business and social benefits of standardisation.

Ready to wear - the ethical issues of the international clothing industry.

Doing It Wrong - what's wrong with the way business works?

New Age - the business of aging.

Project Alcatraz - rehabilitating offenders in Venezuela.

Selling Salvation - Peter Drucker and the Salvation Army.

Let Me Entertain You - office parties and away days.

Brazil's Sugar Rush - Brazil.

Small Wonder - microfinance.

Unlimited Company - organizational models.

Credit Crunch - cash and credit.

Student Startups - student entrepreneurs.

Media Mayhem - changes in the newspaper industry.

Squeaky Clean - branding.

Battery Power - Bolivia.

Women's Work - women in the city.

Hell For Leather - John Timpson and Timpson's Shoes.

Learning Curve - organisational culture.

Let's Start a Bank - banking.

Goodbye to Intel - Craig Barrett and Intel.

Location Location - So?

Iceland feels the Heat - the credit crunch in Iceland.

The Cisco Kid - Mike Lynch and John Chambers.

Grand Design - business schools.

Power Drive - the car industry.

All New - innovation.

Europe on the edge - What is this thing called "Europe"?

For more programmes visit the In Business programme archive.

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