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The Apprentice – Keeping Europe Firmly in the Valley’s Shadow.

So, the results are in and Ricky Martin is Lord Sugar‘s new ‘apprentice’. This is a bad decision. The UK’s Enterprise Champion, responsible for promoting entrepreneurship, should be a catalyst enthusing more people to ‘poke the box’. In short, he failed. Here are the 4 finalists, their business plans and my thoughts…

Nick Holzherr – Online Recipe Ordering

I think it’s fair to say that Lord Sugar didn’t understand the concept. Fair enough, investors rarely get involved with something they don’t ‘get’. However, recipes are big. Ever more sites, apps and shows are appearing that centre around cooking. There’s a lot of money to be made from product placement and commission from sales. Nick fell down by not referencing the existing market with examples of profitable counterparts. Also, if he’s written a working prototype ‘button’ hosted on existing sites then why not evidence the traction achieved?

Jade Nash – Lead Generation Call Centre

Jade did well during the process; clearly, by reaching the final. However, her business plan sucked. So, no surprise that she wasn’t ‘hired’. On the assumption that business plans were part of entrants’ submissions, though, I find it extremely disingenuous that Jade was allowed to enter the process. Why allow someone to go through an 11 week ordeal, with the associated opportunity costs, if she was never going to win?

Tom Gearing – Wine-based Hedge Fund

An innovative idea that combined two existing markets to create a new one. Nick Hewer commented to Lord Sugar that it could be an extremely exciting and profitable business. Lord Sugar’s criticism were based around not knowing the market and his discomfort about investing other peoples’ money.

Ricky Martin – Niche Recruitment Agency

Ricky is a very ‘backable’ individual; but his business plan should not have won. If this was The Apprentice 2009 then he would have triumphed easily. He will no doubt create and run a successful business. I agree with Lord Sugar here; it’s a safe bet.

Conclusion

I remember, vividly, a conversation I had with a Cambridge-based entrepreneur/investor about scale. He said “If you want to be huge, go to the valley. Europe and the UK doesn’t have the capital or stomach for ground-breaking, risky startups.” Ricky’s idea is not entrepreneurial. He knows the market well, but that’s because it already exists. Entrepreneurship should be about creating new markets, pushing boundaries and inventing new ways to solve old problems. The Apprentice should have excited and inspired us. It didn’t.

So, enjoy the continued coolness of the shade cast over us by our US cousins. If our Enterprise Champion cannot shine a little sunshine on us then who can?

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Posted by on June 3, 2012 in Startups

 

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Stowaways on your startup escape path

This is a response to Daniel Tenner‘s post A startup escape path. The basic conclusion of the article is that, rather than simply jumping off the cliff, potential entrepreneurs should plan their exit from corporate life. Overlap what you’re doing with what you want to be doing until you have an idea that you can hit the road running with. This is sound advice but neglects to mention a major problem: your employment contract.

A standard employment contract will say, very explicitly, that everything you do, whether in office hours or not, remains the sole intellectual property of your employer.

This is all-encompassing. The idea for a novel you had whilst on holiday, the new tennis technique you discovered one evening, the great iPad game that just ‘came to you’ in the shower. Whilst your employment contract is in force, these are all owned by your employer.

So, if you’re going to attempt this escape path you have two choices:

1. Tell your employer

Talk with your immediate boss and tell him/her what you’re doing. Assuming they don’t have a problem with your activities ask them to send you an official email or signed letter. This should say that they are aware you’re doing X, that it has no bearing on your ability to perform your duties and that the company lays no claims to it. This is your protection so make sure you are honest about what you’re doing.

The down-side to this is that you’ve now waved a flag with “I’m planning to leave” written on it. If you do, eventually, jump off the cliff then no harm has been done. However, if you decide to stay then you may have blotted your copybook.

2. Don’t tell your employer

You wouldn’t dream of asking our employer if it was OK to play in a band on the weekend so why should you tell them about any startup ideas? If you’re working on this in your spare time then it should be none of their business (literally!). The upside of this is if you decide that entrepreneurship isn’t for you; you can just carry on with your current job and no one is any the wiser. The big problems come if you take your escape path.

At any point in the future your employer can lay claim to the startup you’ve built. If they can show that you started your company / idea / product whilst they employed you then it’s pretty much game over. They may be entitled to, potentially, all the equity in your company plus payment of any profits generated by the company over the years. There are some shades of grey though. If you can evidence that your employer knew what you were doing then any judge would question why they waited until all the work had been done before filing a claim.

Conclusions

This is a very awkward situation and, unfortunately, current UK employee contracts stifle innovation. Your employer is in a strong position to disrupt your innovations in any number of ways if you, quite sensibly, test the wind before jumping off the cliff. If you’re an entrepreneur then I’d love to hear how you dealt with this situation. Please use the comments to tell me your experiences.

 
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Posted by on January 3, 2012 in Startups

 

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