Why being on the cutting edge requires grit and determination
To start with, tech founders set themselves ambitious growth targets. Based on our most recent research, they aim for 20 per cent turnover growth per year, 2 per cent above the average for start-ups, and they are starting from a base USD400,000 higher than the cross-sector average.
The race to be one step ahead
of competition also forces tech
entrepreneurs to expand their ventures
rapidly on multiple fronts, and often
simultaneously at home and abroad.
Right from the start-up phase, tech
entrepreneurs are 10 per cent more likely to
push for rapid international expansion
than founders from other industries.
This takes time and energy, meaning
that tech entrepreneurs tend to work
the longest hours of any sector. Their
average working day is longer than
10 hours. They do not dramatically
cut down on their sleep, but rather
they compromise on their personal
life and tend to spend less time
relaxing and socialising.
In fact, our research shows that tech
entrepreneurs are particularly prone to
losing motivation in the start-up phase
of their ventures – 10 per cent more when
compared with other sectors.
The ambitious targets of tech
entrepreneurs also create a
high-pressure environment and
the fast pace of change in the tech
industry leaves many entrepreneurs
facing a significant growth challenge.
One in three tech entrepreneurs
worries about keeping pace with
technological innovation compared to
one in five in other industries.
One entrepreneur who understands
how to deal with these challenges
is Douglas Orr, founder of Fintech
business Novastone, his third
successful technology business. Mr
Orr’s first venture was a self-funded
data storage business based in
Norway that he sold in 2001, having
battled through the dot-com crash in
the late 1990s. He founded and was
an investor in the second successful
venture, before founding Novastone in
London in 2014.
Serving leading international businesses,
Mr. Orr’s vision for Novastone is a global
one. This can be a challenge in the UK,
where venture capitalists tend to seek
out “local heroes”.
It is even more challenging in the
Fintech sector, he explains. “We serve
established high-end businesses in the
financial and legal sector, where the
sales cycle is relatively long. It requires
He explains that many UK venture
capital firms are wary of international
ventures, which leaves angel investors
to fill the gap. These angels have often
created their wealth in financial services
or property, not in the technology
industry, which means they too are
often cautious about the tech sector’s
global growth ambitions.
He likens the challenge of being a
Fintech start-up to being a “small ship
in a big ocean”.
“To be successful in the tech industry it
is simply not enough to aim to become
the next ‘local hero’ you need to
become ‘a global hero’,” he says.
The second challenge he highlights
is the difficulty finding a network
that can help to access funding and
provide the support and connections
to help the business to grow.
In fact, our research shows that tech
entrepreneurs are almost 10 per cent less
likely to be able to access coaching
and mentoring than start-ups in
Mr Orr’s advice for start-up tech
entrepreneurs is therefore to seek out
angel investors who have experience
in the tech sector and can support
your growth ambitions.
“I have been fortunate to find
tremendous angel investors who really
understand the tech industry,” he says.
“They understand the funding cycle
and they can open doors.”
Mr Orr adds that they provided a
crucial sounding board that helped his
idea to work and take off. In the fast
paced tech sector, success is all about
having the right strategy at the right
time, he explains.
“You need to embrace your failures
quickly: you have to fail fast. Having
good mentors is a way of learning
faster, which will take you more quickly
to where you will be successful.”
It also requires perseverance.
A keen runner himself, Mr Orr
compares growing a tech business
to running a race. “If you persevere,
you are still in the race – you might
be in the wrong race with the wrong
strategy, but it is perseverance that will
help you to get the right race plan.”
Comparing the UK to Silicon Valley,
Mr Orr highlights that London is a
great place to grow an international
business. Many talented young
developers have been drawn to
the city and have brought a strong
entrepreneurial spirit with them.
However, the network of experienced
technology entrepreneurs is still
relatively thin in the UK. This, he
believes, is the biggest single factor
that makes building a technology
business particularly challenging.
“We have a few really successful
tech entrepreneurs in the UK, but we
need a hundred of them. We are still
very much breaking down barriers
and I don’t know how many years or
decades it will be before we have the
strong network of mentors we need to
support funding, growth and exports.”