Friday, April 4, 2014

Do you really need to win an award to start your enterprise?

I was following an enterprise start-up awards ceremony on twitter recently that had sought applications from people who felt they had great ideas for a new venture, to be considered for being the recipient of a relatively small grant to support their start-up needs.
There are always programmes such as this running somewhere, all with different priorities and criterion for applicants and would-be entrepreneurs, but how much do they actually help?
Setting up any new venture takes time and involves risk – anything we do during this critical stage has to assure us of the best possible return for our investment of all-too-precious time: applying for a grant/award takes valuable time, and is inherently risky: not just in outcome, but also with the conditions that will invariably be attached to it.
By encouraging start-ups to apply for such funds are we therefore actually doing more harm than good? Not only will any such awards will come with constraints on their use, and have an economic cost of other options not pursued, they also engender a culture and mindset of 'handout': establishing a venture on the philanthropy of others means that it will ultimately weaken its ability to be sustainable and viable – always needing a crutch of some type, rather than standing on its own two feet as other enterprises who've bootstrapped their start-ups are subsequently better able to do.
For some, such awards really do make all the difference owing to their personal circumstances: there's no way that they could afford, or be able to access the finance they'd need any other way. So such awards have their place – perhaps we therefore need to be more stringent in their application criteria, encouraging would-be award winners to explore other options first that they may have recourse to that others in our unequal society can't?

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