Many small and medium-sized businesses fear for future
New research claims half across the UK think they won't survive the next 12 months
Many small and medium-sized business across Merseyside fear they won't survive the next 12 months.
New research has found that nearly half across the country feel that way, compared to 11% last year.
The new Founder Barometer report from Virgin StartUp has revealed that the cost of living crisis (52%) is the biggest challenge.
LYVA Labs was created around two and a half years ago - it's funded by the Metro Mayor and the Combined Authority to provide early-stage funding to technology-based start-ups in the Liverpool City Region.
CEO Lorna Green said:
"We're heavily reliant on on the combined authority and that devolution fund. But importantly, it's the businesses that we support that are really kind of feeling it and and there's a lots of data that shows that businesses will grow faster if they innovate and they've got a strong pipeline of new products.
"But that takes funding and it's high risk. Lots of businesses are struggling with pay at the moment and salary and inflation and energy bills.
"It's really hard to start from the ground"
"So they don't necessarily have the resources or the funding to invest in those new technologies to grow their business - or if they're a start up, it's really hard to start from the ground and trying to build exciting new technologies. It takes time and it takes money and it takes expertise. That's why LYVA Labs comes in, we're trying to help those businesses who are trying to grow in our city region.
"They typically can't afford an experienced team and lots of people to help them, they can't pay lots of consultancy or advisors. They're trying to develop new products which takes lots of funding as well, so it's really hard for the start-ups to to find all of the wealth of experience that they need. They're going to need HR, they're going to need finance, they're going to need marketing, they're going to need technical support, they're going to need advice on regulations and business standards, all while they're building a business and it's very hard to find all of that those skills and that experience in one person, even in the most successful of entrepreneurs.
"There's something wrong there"
"Innovate UK funding is meant to help with that and fill that market failure by giving grants to businesses, but our region gets about 3% of those grants in the North West in general.
"We've got 11% of the population in the North West, 7% of the research funding flows into our universities, but only 3% of the innovation funding for business that flows into our region, so there's something wrong there. We need to be getting more of our businesses, more of that government money so they can innovate and they can grow.
"When you're in regions like the South East, where there's a whole ecosystem and in the industry around raising money and going for these grants, you get good at doing it so those who are good at it, get more and it's harder for those in the regions where they maybe don't have all of that research and development infrastructure or advisors.
"There's another data set that shows that only 8% of businesses in our region have ever been on any sort of kind of accelerator growth programme. That's compared to 21% in Manchester and 26% nationally and it's probably 60-70% in the South East.
"So how do you get good in that process if you don't have the experience? In our team, we've got grant writers, we've got experienced investors and we can we're trying to train and mentor those businesses so that they do get good and so they've got better chance of winning and starting to draw more of that funding down.
"If you build that ecosystem, businesses will stay"
"If you build that ecosystem, businesses will stay as well, as we lose businesses from the region because they can't get the support or can't get the finance here.
"So if we can put that ecosystem in, that network of support and the finance, then we're more likely to retain those high growth businesses and keep them in our region, which is only going to benefit the wider society."
Paul Cherpeau, CEO of Liverpool Chamber of Commerce, said:
"The picture in the economy is pretty mixed depending on the type of business you are, the particular industry you're in and the life cycle of the business that your organisation might be in as well.
"There's still a remnant impact of COVID and the impact that bounce back loans and financial support mechanisms that came in are having an organisations. There's still a substantial challenge around the availability of skills and specific skills for particular industries, so there's a productivity challenge as well.
"A really mixed picture"
"At the moment, there's a shortage of some types of occupancy, some of which go back a number of years, some of which have emanated as a result of more recent economic developments, so it's a really mixed picture at the moment.
"The general sentiment I think is improving, but there still remain some substantial obstacles as some of the some of the insights and the reports that have recently emerged demonstrate, so it'll be really important over the coming period of time as we emerge from which from a period which had a number of economic headwinds such as the cost of living crisis, such as COVID - that we start to see with a new government in particular, a more stable environment within which businesses can trade, operate and prepare their plans for the longer term.
"Whereas a lot of them have been operating in an environment that has been driven by a lot of short term political decisions and therefore in an environment of instability and uncertainty, which businesses generally dislike because they can't make those long-term decisions with the degree of confidence or accuracy that they would like.
"It's the talent that will stimulate economic growth"
"Tt's a great opportunity now looking at health and life sciences, manufacturing, creative digital organisations, using the natural assets that we have, using the assets that we've developed over the last half a century.
"Pulling that together into a really compelling narrative and making sure that we have the talent base here, because ultimately, it's the talent that will stimulate economic growth over the next 20 years.
"That's where we really need to make a focus and to what businesses are saying.
"They're saying to us all the time the talent base is the most important thing to stimulate the next generation of success for our city region."