As anedotes become data
Has the pandemic led to major job losses? I found a pile of old business cards from 2019/20 Wrote to them. Normally, 20% of people "move on" each year. This year? 40% or more. Anecdote or data?
It was a great pleasure to come across a pile of business cards that I had not reviewed having put them into the wrong drawer around Easter 2020. Felt like a reminder of some ancient history where people could shake hands! Rather than just having a PA-bot enter the details raw into a CRM, I felt it worth sending something a little more substantial. Perhaps there were people I needed to speak to in that pile? I composed a longer email to around 120 people and sent it out. Those were people that I had not seen for at least a year. I would normally expect about 10% to bounce back, given most people were senior level directors, founders or investors.
National statistics suggest a small bump in job losses, but only in sectors like hospitality and retail:
That suggested nothing much should be wrong among entrepreneurs and professionals.
I was shocked to find 40% bounced back, with around 10% of the companies no longer having an active server. That speaks to a major increase in job churn and unemployment among some highly skilled people.
Normally, I would check the company on Companies House, but that is a bit behind right now. Closing the company MX address suggests that something has gone badly wrong for them.
Is this what you are seeing? I’d welcome comments and responses.
The letter is below. I hope that is not what caused people to bounce my contact. I will let you decide:
2020 was punishing for many people, with old business models coming under severe stress and the networks and social capital that we all rely upon to generate trust and business value starting to crumble.
With your forbearance, I would like to share some of what I learned.
As a Chartered Accountants, I was working as Non-executive Director to a few start-ups and providing turnaround services to others. As a volunteer I was a director of SEMLEP (a public private economic partnership serving the area that is now becoming the Oxford-Cambridge Arc https://www.semlep.com/oxford-cambridge-arc/ ) where I chaired the Inward Investment Group.
Clients that I had supported for years shifted from expansion and growth to survival mode. For most trading business, times were very hard. Staff with critical skills were laid off or furloughed. The pandemic devastated many face-to-face businesses and their supply chains. Many took on debt supported by Government guarantee, and that debt will take years to unwind. Others, especially those reliant on suppliers, customers, or IP partners in the European Union, were stockpiling and restructuring ahead of the expected disruption of Brexit.
It did look incredibly challenging indeed.
As many of you did, I looked at what I was doing, assessed its strategic future, and replanned for 2021.
The urgent demand for innovative responses encouraged me to sit down and write 100,000 words for what quickly became the highest rated and most viewed course on innovation management - without the ability to focus on learning and creation offered by the pandemic, I doubt that would have been possible.
Armed with that, it was clear that the innovation response was the one that would create the answers needed by everyone.
At SEMLEP we saw that the responses to the pandemic were very much sector dependent. The national response was to "shore up the breaches". In among the damage, however, there were bright spots and companies that showed significant growth. Those were initially difficult to find, but some excellent work was done by major studies to identify those who would thrive or rapidly recover. So, we created an economic recovery strategy - which is now being funded and rolled out. It was clear that the national response was shifting to a forward focus.
My personal response was to move into deeper strategic advisory for the entrepreneurial founders of technology enabled companies in sectors that had positive responses to the pandemic and Brexit. As examples: a computer and video games company I worked with showed 50% month on month revenue growth, a software testing company doubled in size, a PropTech company identifying sites for logistics hubs grew 400%, and a solo founder who had an online mental health service suddenly needed to go on a hiring spree.
I created a regulated accountancy practice and shifted my own business from face to face to online. https://www.djwbandco.uk/ and I shifted my outreach from events to online content and social media https://djwbandco.substack.com/. To make that productive required engaging with a new network of trusted suppliers and subcontractors, many of whom were "virtual consultancies". More of my time was put into financial strategy and business growth consulting than before, as clients invested in their future and cut their losses.
It has been hugely rewarding to be able to help clients through these new channels:
a hot metal engineering company to shift its focus to more profitable sectors after ripping out some defective systems and installing some that worked
an audio technology company gained business from companies seeking to make shared spaces safer and raised new capital and won government grants for IP development
a data science company took advantage of relationships in Singapore to refinance and begin to tackle some deep problems in low-cost housing provision
a property company needed radical restructuring and refinancing, and turned a 100% loss into a realised 300% gain in just 12 months
a Swedish consultant worked me and with a Milan university to create a way to roll out a scientific method of decision making that showed up to 4x acceleration of revenue when applied to over 700 small ventures.
a luxury jewellery company pivoted from stores to online sales
2021 will, no doubt, contain surprises and challenges, but the environment for investment, growth, and creation of valuable IP in the UK still contains some gems. I hope your business does as well.
Here is to innovation and 2021