PracticeConsultingBusiness Finance – Leslie Bland.

Business Finance - Leslie Bland.

Over the last 30 years I have been involved with small businesses and entrepreneurs in every possible dimension. From my own experiences as an early-stage entrepreneur, to assisting other small businesses by providing cash flow security, the one factor that I have seen everyone grappling with is risk.

Outside the wider issues of business culture, the UK is lagging behind other developed economies because of the burden placed on entrepreneurs and those business angels courageous enough to invest in high-risk businesses.

The present UK government is at least prepared to challenge the status quo, as evidenced by the government’s recent backing of the National Business Angels Network, but this is really just scratching the surface of a far deeper malaise.

The problem we are facing is one of bureaucracy. In the US, private individuals are given incentives to invest in early stage businesses. Potential investors are offered tax breaks on capital invested in high-risk new businesses, while the process of actually doing so is far more simple than it is for UK angels.

Civil service administrators, both within the Treasury and the DTI, seem unwilling to attempt reform unless it can be achieved on a purist level.

Yes, a tiny minority could abuse investment incentives, such as those provided in the US; however, this does not mean that attempts at reform should be shelved altogether. Experience in the US has shown that these incentives have provided a solid backbone for the growth economy.

Similar problems with bankruptcy legislation have hampered entrepreneurial behaviour in the UK, but at long last the government has shown its willingness to redress the current criteria, despite detractors citing potential abuse of the proposed system.

Almost all of those involved in business can see the great sense behind this, not just by directly boosting the SME environment, but also in the long term, by inculcating an entrepreneurial spirit within our society – one which not only accepts risk taking but also admires those who attempt it.

If the UK wishes to be in the forefront of world economic advancement, we need urgently to deal with the regulatory deterrent facing high-risk business angel investors. There is at least an acceptance of a greater need for an US-style SME growth sector, but now is the time for action not platitudes.

Related Articles

5 tips for SMEs to protect cash flow

Accounting Software 5 tips for SMEs to protect cash flow

5m Alia Shoaib, Reporter
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

11m Stephanie Wix, Writer
Managing partner Q&A - the year ahead: Richard Toone, CVR Global

Accounting Firms Managing partner Q&A - the year ahead: Richard Toone, CVR Global

12m Kevin Reed, Writer
Deloitte 'self-imposes exile' on government contracts to defuse PM row

Accounting Firms Deloitte 'self-imposes exile' on government contracts to defuse PM row

12m Kevin Reed, Writer
Managing partner Q&A - the year ahead: Julie Adams, Menzies

Accounting Firms Managing partner Q&A - the year ahead: Julie Adams, Menzies

12m Kevin Reed, Writer
Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

Business Regulation Friday Afternoon Live: Deloitte's tech thing; PAC wants HMRC 'contingencies'; and Sports Direct

1y Kevin Reed, Writer
Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

Audit Friday Afternoon Live: HMRC complaints rise; Deloitte scoops big audits; and corporate reporting woes

1y Kevin Reed, Writer
New head of equity capital markets for KPMG

Accounting Firms New head of equity capital markets for KPMG

1y Stephanie Wix, Writer