Big push on to find the new entrepreneurs

A dearth of successful new companies in the North-East has spurred the biggest ever push to transform our youth into the entrepreneurs of tomorrow.

A dearth of successful new companies in the North-East has spurred the biggest ever push to transform our youth into the entrepreneurs of tomorrow. Nigel Stirling investigates.

TV reality shows Dragons' Den and The Apprentice have driven public interest in business among the general populace to an all-time high.

The cut and thrust of big business, powerful people in designer suits, bizarre money-spinning ideas and the promise of big money are all handy when it comes to engaging teenagers in the idea of starting their own company.

Events such as Biz Idol, a Pop Idol-style event to find the next Alan Sugar or top flight entrepreneur amongst the region's youngsters, have mushroomed.

Young Enterprise, best known for teaching secondary school children the lessons of business by getting them to set up their own company, is experiencing boom times. In the North-East alone the number of youngsters participating in Young Enterprise programmes has jumped from 10,000 two years ago to 24,000 last year, with further growth of 25% expected in 2006.

Last September the Government introduced a requirement for all secondary schools in the UK to devote five days of an academic year to the `enterprise education' of pupils above Year 10.

However, this rush to inculcate the nation's youth into the arts of entrepreneurialism poses important questions. Can entrepreneurship be taught or is it more to do with innate ability? And should resources be diverted to tackling shortages of more rudimentary skills, such as those learnt on industry apprenticeships?

One thing is clear. The United Kingdom has a poor record of starting up new businesses compared to more economically successful countries such as the US, Canada and even New Zealand, where the rate of business start-up is twice that of the UK.

A dose of entrepreneurialism is sorely needed in the North-East. According to regional development agency One NorthEast the region needs 20,000 more businesses to attain 90% of the economic performance of the rest of the United Kingdom.

Tim Pain, head of enterprise and business support at One NorthEast, which is pumping £750,000 a year into enterprise education initiatives in schools and colleges, says it is historical circumstance that has stamped on the region's entrepreneurial spirit.

"In the North-East there is a history of a smaller number of large employers. People have just not thought about starting a business as a way of making a living."

Raj Patel, director of policy at Enterprise Insight, a Treasury-funded body backed by industry groups such as the CBI and the Federation of Small Businesses, says the lack of new businesses coming through the ranks is a UK-wide problem.

"Our entrepreneurship rate is half that of the US, where entrepreneurship is defined as the number of people either in the process of starting a business or have recently started. But according to the OECD, Britain is one of the easiest places to start a business in the world because of low barriers to setting up a company.

"The explanation is culture. There is not the attitude there is in the US to risk-taking and entrepreneurship and the easiest ways of changing those attitudes is teach them at a young age."

What is more difficult to find agreement on is the worth of teaching entrepreneurial skills to youngsters. Young Enterprise does not keep records of how many of youngsters have gone on to start up their own businesses and academic opinion on the subject is divided.

According to a study in late 2004 by the Canadian Federation of Business, entrepreneurs are commonly believed to have special traits that make them successful but said "no one has been able to identify a truly unique set of entrepreneurial personalities".

But even if it is accepted that entrepreneuralism can be taught, surely not everyone can be an entrepreneur.

Catherine Marchant, chief executive of Young Enterprise North East, says organisations teaching entrepreneurship must be quick to add a dose of realism to the perceptions created by reality TV series like The Apprentice.

"They have certainly raised the profile but I think it has also had the effect of discouraging some youngsters from thinking about business as a career. In the North-East you are talking about some areas where there is second and third generation unemployment.

"We need youngsters to be aware that to be an entrepreneur you don't have to be a Richard Branson or an Alan Sugar. An entrepreneur is the person down the road who runs the hair salon or the fish and chip shop. We need to be careful that we do not raise the bar too high."

Ms Marchant says the skills passed on in Young Enterprise are not wasted even if the recipient will never set up their own business.

"It is about teaching skills that can make youngsters more ready for work and understand the role business plays when they enter the workforce. Even if you are working in a department of BT if you can understand profit and loss and understand the motivation behind the decision-making processes that businesses make every day you are going to be a more valuable member of that workforce."

Over 1,200 volunteers from businesses in the North-East act as mentors on Young Enterprise courses but Ms Marchant says integrating entrepreneurship into the school curriculum and aligning teachers' academic approach to that of enterprise education is not always easy.

In Chancellor Gordon Brown's most recent budget the Government earmarked £50m for entrepreneurship summer schools to be held over the next three years.

Business mentors will be a key part of delivering lessons of entrepreneurship at the schools and will set up tours of local businesses such as Middlesbrough FC, the Walkers crisps factory and software firm Sage.

Ms Marchant said: "It is difficult when you are talking about embedding principals of entrepreneuralism into each subject. Teachers are not by definition entrepreneurs and often have only experience of academia or teaching.

"I firmly believe that maths teachers should be left to teach maths and that the role of mentors is all-important.

"Business people are busy people but they realise that they have to make this work and get involved and pass on these skills. They realise that competition is healthy and that if their businesses are going to survive they need a skilled workforce and a region which has a vibrant economy."

CBI regional director Sarah Green does not accept criticism that making enterprise education a compulsory part of the school curriculum takes away resources from the teaching of more elementary subjects, which employers complain are often lacking amongst new entrants to the workforce.

She said: "I think they can be complementary. When you are setting up your own business you need to work with numbers and be able to write a report for the bank manager or to investors.

"I can see no reason why traditional lessons which are important in building literacy and numerical skills cannot be taught within the context of teaching lessons in entrepreneurship."

Karl Watkin, the man behind biodiesel producer D1 Oils and skincare products maker Dermasalve Sciences, is unsure about whether entrepreneurship can be taught, but he is forthright about influences would-be entrepreneurs should be protected from.

"What entrepreneurs do is make things happen. What often happens, which is the biggest problem in society today, is people trying to stop others from doing things.

"When you are an entrepreneur what happens is a big light goes off. The first person you tell you have a great idea will ask whether you've got a feasibility study? You say no.

The next person you tell will ask if you have a budget?' You say no.

"I have no problem with refining business skills but you cannot stamp on that light until it goes out and you turn those with ideas into grey suits."

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