Friday, February 9, 2018

who in their right mind would be self-employed?

I've been self-employed for over 13 years now (although more by accident than deliberate design), and I increasingly hear arguments being made everywhere as to why more of us should set up our own businesses, become self-employed, or start a career as a freelancer. 
But in all the hype and excitement, I can't help but feel that people aren't being given the 'full picture' of what they might be trading off in not pursuing more traditional employment options, and as a result, rushing into something that makes their lives harder and less happy than they might potentially have otherwise been.

Don't believe me? Well, what about these various published researches that highlight the 'dark truth' about self-employment that very few (if any) of its advocates share with us:

less earnings and more poverty - 
- as a body of workers, we're increasingly likely to be earning below the minimum wage, and the trend is that this will be true for majority of us within the next 2 years: 

- compared to our 'employed' counterparts, we're actually earning less now than we did 20 years ago: 

- and compared to those same employed counterparts, we're also paying more in tax on the earnings we can make than they do on the wages they're paid:

- changes to our benefits system by government, means that for those of us who qualify as being eligible for some type of income support, we'll now be about £2,000 a year worse off than before...

- all of which means that many of us have very little (if any) cash savings to fall back on in the event of a 'rainy day':

more sickness and worse (physical) health - 
- we're not entitled to sick pay: if we get sick, we can't earn or claim anything in the way that our employed counterparts can:

- as a result, over 80% of us who fall ill will work through it, as we can't afford to stop earning, placing further risk to our long-term future health:

more loneliness and worse (mental) health - 
- working for yourself means you're more likely to suffer from loneliness and the anxiety that's associated with this:

longer hours and less time with / more stress for our families:
- if the main household earner is self-employed (as was my own experience for 12 years), then not only are their relationships with their family increasingly likely to suffer, but their family will also begin to feel more stressed as well:

- we also work longer hours (typically 13 hours a day), with less time off for holidays:

- and women in particular struggle to be able to maintain a semblance of controlled hours if self-employed, juggling multiple family responsibilities which lead them to have extremely elongated days with little (if any) time for themselves and their own well-being:

- less than 1 in 5 of us is able to save into a pension (unlike our employed counterparts whose employers make regular monthly contributions into one on their behalf on top of the salary they pay them..):

So the research shows us that to strike out as an entrepreneur means you're more likely to be poor/in poverty; suffer long-term ill health; have worse relationships with your family; and never be able to retire...
and you what makes this even worse? Government is aware of all of this from the official statistics it collects and openly publishes, yet somehow doesn't seem to be able to get around to doing anything about them: 

If I've made it sound like self-employment is a bleak landscape that only the wretched and foolish would dare to venture into, I apologise. My interest in collating and presenting these various and multiple researches is, as always in my blogs, a desire to share knowledge in helping people make more informed decisions and being able to spot/avoid hype - it's not all doom and gloom for everyone. After all, 15% of us do it. And we do it for a variety of reasons: the unavailability of other forms of employment, the need for flexibility around family/caring responsibilities, the desire to use a personal skill or passion that outweighs the apparent cost of maintaining it as a sometimes hobby, and similar.

And in light of our Government's apparent disinterest in us, we're also increasingly finding ways to support ourselves:

Facebook groups like Freelance Heroes

Campaigns like MicroBiz Matters

Pooling of financial support for each other through co-operative initiatives such as 'Bread Funds'

The current state of self-employment and freelancing may therefore be very precarious, but we can perhaps have hope of a brighter future if we start to take more action in all of our interests by working together, and supporting each other more..?

Wednesday, January 24, 2018

based on official statistics, my support to enterprise is far better than what the government pays for...

Business support comes in all sorts of forms, in all sorts of places, and from all sorts of people.

But the question that all entrepreneurs face when navigating the options out there, should be "is it any good?"
And there are all sorts of ways in which you can start to consider the quality, validity, appropriateness, (and even legality!) of the support you find and the advice you're offered through it:

- what qualifications does the person have? (but as I've shown before, a qualification is only an assurance that the person has been taught something, it's usually no indication of how knowledgeable or competent they actually are...)

- what recommendations have others made about them? (but again, I've evidenced how you can't trust any such endorsements a person may have received...)

So what's left? Well, how about statistics relating to performance? After all, it's how the success of any contract or project is usually considered, and the government's flagship business support programme, the growth hubs, are regularly applauded on the basis of these.

But the latest published self-congratulatory statistics about the performance of these growth hubs suggest that they may not actually be that great in practice, and when I compare my own performance against theirs, I seem to come out in a far better light:

Growth Hub - only 5% of all businesses who contact them actually get some 'real' (in person) support
Me - only about 5% of people who contact me by websites, social media, email, or phone don't get the opportunity to have a 'real' (in person) contact and support

Growth Hub - 87% customer satisfaction
Me - 98% customer satisfaction

Maybe this is why I was named as one of the UK's top10 business advisors by Government, and have a trophy cabinet of national and international awards, and the growth hubs don't?
Or maybe it's a case that there's are lies, damned lies, and statistics...?

Monday, January 15, 2018

microbizmatters day - 1 down, 364 to go...

Last week saw the 4th annual #MicroBizMatters Day - a day long live stream on youtube of interviews, performances, challenges, and encouragements to, for, by, and about, micro business owners everywhere (you know, micro business: those small local firms who collectively employ 1/3 of the population, make up 96% of all businesses, and such like, but yet receive hardly any government support...)

Anyways - as with last year, I (and my fez) were invited to the host venue for this year, XYZ Works in Manchester, to help co-ordinate and support the day. And now 'normal service' is being resumed, it's probably a good time to pause to reflect on the day that was, and why it may be the least important day of the year for micro businesses..?

For those of you who missed the day's broadcasts, you can catch up with the full 7 hour (and a bit) broadcast on youtube here:
And there were also a number of 'bonus extras' broadcast via facebook live over on the MicroBizMatters page there: (where you may be able to spot me showing off my 'red carpet socks' and explaining why a moustache has appeared on my face...)

There's always a lot of excitement around each MicroBizMatters Day, but I'm wondering if in the rush of the romance of it all, we risk forgetting that it may not be that important in the grand scheme of MicroBizMatters - talking with guests and visitors to the 'broadcast suite' on the day, i was struck by how many came to be involved through the ongoing campaigns of the movement. And its these campaigns that we should perhaps highlight more, as its these that will change the culture and landscape for micro business everywhere by being talked about every day, in ways that a single days live stream could never hope to achieve?

#PayIn30 - making sure we keep the cash flowing in micro businesses, and that our clients pay when they're supposed to

#Indie25ER - a target of 25% of our purchases to be made from local independent micro businesses, to help strengthen their resilience as providers of local services and local employment

#NotAnSME - challenging government to do more to recognise the valuable role and contribution of micro businesses to GVA, employment, import/export, and generally doing a fair bit to keep the UK economy going!

#IGave12 - encouraging micro businesses to offer support to each other as part of building a peer-led movement

As for my own personal role on the day, I'm pleased to report that I seem to have retained my reputation for being the MicroBizMatters 'naughty boy' judging by others' posts and comments about me on instagram and twitter (including my tabletop dancing...), but that the professionalism and standard of the other roadies to the day seemed to more than cover for any reputational risk my antics may have otherwise caused:
Paul Lancaster (who also sponsored our breakfast!) -

Tuesday, January 9, 2018

the return of the fez...

On Friday of this week (12th January), it's #MicroBizMatters Day: the 4th annual celebration of micro businesses in the UK:

As some may recall, I was invited to be one of its head roadies last year, and as part of the dress code for the event, my fez made its global debut (the day is live streamed from 7am). 
I've been invited back again this year; and I'd like to think it was because of the appreciation of the stories, encouragements, and support to the day I was able to share last year, but just in case, I'll also be packing my fez in case it was that which secured me the repeat booking!

Watch out for various posts during the day using the hashtag (#microbizmatters started trending on twitter during last years' day), but there's also the chance to read all about it with an advance peek at the souvenir programme which has been leaked early! (click here to download a pdf copy).

See you on Friday, and in the words of Tina and Tony, "keep rocking..." 

Wednesday, December 6, 2017

working until the end of my days..?

So I'm now of an age where I no longer think myself invincible, but thankfully still have all my teeth and a bit of hair...
And strange things happen when you get to this point in your life, especially with regards to thinking about your future - you find yourself not just concerned with worrying about if/how you'll take your next holiday, but also that thing called 'retirement'...

There have been studies, articles, and blogs published over the last few months around the internet that suggest we're all going to need to keep working for longer into our twilight years than previous generations have, and that when we finally can officially retire from the need to be an economic contributor to society and the economy, we'll have a lot less to live on.
But these all tend to relate to the 'traditional' worker - people who are employed, with an employer contributing to a pension pot on their behalf, to supplement what will be left of the state pension when we get to that milestone in our lives.

I, and quite a few others, are self-employed. We don't have an employer who's making contributions into a pension fund on our behalf. And most of us struggle to be able to afford or justify making any monthly contributions to a fund out of our own earnings judging by trends in freelancing and self-employment which shows we earn less than our employed counterparts (while at the same time somehow paying more tax!):

To redress this, some of us will be looking to use our homes as our pension fund - hoping to pay off a mortgage, and then when the time comes, sell the house and live off the proceeds. But many of us don't have a mortgage or the security of owning our own home (and may never be able to). And even if we did, we may have children who we want to offer some legacy and support to for their own futures, and so we don't want to blow whatever we might be able to raise from selling our home to make sure we can leave something for for them...

All of which, is why I'll be following the current initiative on thinking from TheRSA into how retirement security for the growing numbers of people who are self-employed can be strengthened ('cos the current options don't really work!)

Wednesday, November 15, 2017

and the least sustainable legal form of social enterprise is...

Anyone who's ever asked me for (professional) advice or guidance will know that I always try refer to what published research has to say about your question - I'd much rather offer option and direction on the basis of objective evidenced knowledge, rather than any personal preference or other bias.

And many know that I also seem to be able to make sense of all the options around legal forms for social enterprises here in the UK (at my last count, 14 options that fall under 7 regulatory bodies depending on which you pick) - something which has led me to be invited to develop and deliver training courses throughout the wider sector, be interviewed for webinars, and also offer some of my famous beer/cake mentoring in relation to as well...

Historically, when helping people navigate these choices as to their legal form, I've always referred to the legal powers of the respective regulators, what published research shows about their apparent success in being awarded grants, and their relative 'popularity' based on sector mapping studies.

But today I add another dimension to this referencing and research about social enterprise legal forms - how they affect your future financial performance!

Given the complexities around understanding and mapping the wider world of social enterprise, there's scant research or monitoring around how any enterprises' chosen legal form may impact on its future potential for success in financial terms - and while there are lots of other contributory factors which means that we can never look at the legal form as the sole indicator of this performance outcome, I felt it might be useful to take an initial look at what the studies that are starting to be published might be suggesting.

To this end, I'm indebted to Power to Change's research team, who have started to track and publish bench-marking data for social and community enterprises around a number of themes, but also a couple of other bodies too. There's not many sector mapping studies that look at the performance of an enterprise correlated to its legal form, but the initial ones I've been able to draw on are:

And yes, the data from these will be subjective - for example, Power to Change will only be reporting on data from social/community enterprises that it has directly engaged with and supported; but as I said already, this is a first go at seeing what might be gleaned and identified from cross-referencing what these studies and mappings appear to be finding.

And what they seem to show is:

  1. Charities are consistently the best performing legal structures with average turnovers having the least variance of all legal forms between the different studies (£450k - £650k); they also seem to generate the highest profit ratios from trading activities (averaging 11%)
  2. Companies limited by guarantee have the lowest reliance on grant funding (averaging 48%), but also a lower profit ratio of 4% of income
  3. Co-op Societies seem to struggle to generate profits (2% of turnover), but in having the largest average turnover of all the legal forms (£7.2m), this equates to far larger cash amounts than the other options do
The biggest surprises though, come in relation to CICs - the Power to Change study shows them to have an average turnover of nearly £2m, but the CIC Associations own mapping found the vast majority generate less than £10,000 a year. This clearly shows that there's HUGE variances between individual CICs that are trading: there are a few 'unicorns' out there, but most are 'zombies'. 

And I use the phrase 'trading' loosely, as these various studies also highlight that CICs are the most grant reliant and dependant of all the legal forms (58% of all income is grants - for comparison, it's 53% for charities; and grants are used as the main route by the majority of CICs for raising any investment). Worryingly, they are also the only legal form whose average enterprise seems to be generating a loss - Power to Change's mapping found that the average CIC makes a loss every year of -1.5% against its income...

I've blogged before about how the 'honeymoon' for CICs may be waning, so does this add further weight to my concerns about the viability of this legal form to best enable social entrepreneurs to achieve their vision? (especially when 1/3 of all CICs also report that this legal form has been a hindrance to them doing so...).

I don't know, and I don't think that this quick snapshot across a handful of others' published data can offer any real answers. But what it hopefully does is to help further add to our knowledge about the best routes through which social enterprises can best realise and fulfil their potential. Hopefully it will also generate more and more useful questions for those undertaking future studies into this wider sector.

Wednesday, November 8, 2017

if you want support for your startup, you'll likely need to ignore your ethics...

I find myself in an unusual conundrum as an enterprise advisor who also has a pretty explicit set of values and ethics in how I approach the way I work:

Over the last few years, government has consistently reduced the amount of resource and support available to people who want to start up different types of businesses as a route to employment, generating jobs, changing the world in new ways, and such like. This has meant that the support that so many entrepreneurs of all types need and value is increasingly scarce.
At the same time, high street banks and financial services bodies seem to be moving into this business support space through creating startup grant funds, developing (free) incubators and workspace, and sponsoring national thematic enterprise support initiatives.

All seems pretty straightforward? And economists would probably point to this as an example of how market forces are creating responses that people and enterprises need, without the need for state intervention.

But here's the rub - a recent survey of the 'ethical-ness' of high street banks seems to suggest that those who are scored as 'most unethical' are the ones doing the most around these startup and social enterprise support initiatives. A case of 'buying your way out of a guilty conscience'? (

And for the entrepreneurs accessing this support - some won't care where the money's coming from, but I see that people increasingly are interested in how that money has come to be on the basis of choices about where they choose to invest their own savings, suppliers they choose to procure from, and the places they try and recruit their staff from.
Market forces are all well and good, but remember that the market isn't a person - it doesn't have ethics or values like you or I. And that likely means that entrepreneurs' difficult choices will only be added to in the future when they start to weigh up the ethics of accepting the support that they know that their enterprise needs, but comes at a cost of having been raised from investing and trading in practices that they'd otherwise be very uncomfortable with...