“How to create jobs …and value”
‘The Pursuit of Happyness’ is a 2006 American biographical drama film based on entrepreneur Chris Gardner‘s nearly one-year struggle being homeless. When Chris Gardner (Will Smith) makes a bad investment on a useless bone scanner, he literally loses everything—his money, his wife, and his home. At this point, many might turn to wallowing in self-defeat. But motivated by his desire to provide security for his young son (Jaden Smith), Gardner does the opposite. He manages to snag a coveted internship at a brokerage firm, and devotes every solitary fragment of his energy, ambition, and resources to the task, without so much as a mumble of complaint about his situation.
Despite his limited resources, Gardner used his setbacks as fuel to ignite his ambitions, and ends up winning himself a job as a stockbroker in the process. What starts as a story of perseverance for 1 man ends with a true story of 1 man creating hundreds of jobs in his own brokerage firm, Gardner Rich & Co.
We have a similar view at the Alacrity Foundation – ‘Go and create jobs … and value!’
At the Alacrity Foundation, based in Newport, South Wales, we aim to create the next generation of tech entrepreneurs based in Wales. We want to produce globally scalable tech companies in the Principality. We attract capable graduates on to our programme, we form teams and we provide them with demand-led projects to work on. During a structured 15-month programme we provide graduates with a stipend of £1,500 per month and world-class mentoring from practitioners at the cutting-end of tech and business start-ups. If the teams are successful they can incorporate and may be eligible to a significant seed investment. Even with this offer it is still difficult to recruit graduates with the right skills and, most importantly, an entrepreneurial mind-set.
Despite what we think is one of the best offers on the market, it is a difficult task to convince a talented developer, fresh from ‘uni’, to take on a role at the Foundation that provides the equivalent of £22K a year, whilst a Cardiff tech firm recently recruiting developers announces, ‘We’ll pay £100k, but can’t get staff’.
PEOPLE ARE PEOPLE
Some of our applicants are materialistic (and there is nothing wrong with this!) with an expectation that their start-up will allow them to own a conglomerate of assets, a private jet, large houses in North America and the UK and build a world-class hotel and resort complex in about 2 years (there is a lot wrong with this timescale assumption); but what a dream! What an ambition!
Some other applicants just want to work for themselves and build a business that will materially change the sector they are operating in and contribute to the wider society. We look for people with both material and ‘spiritual’ motivations. Entrepreneurs have to have talent and a drive for the ‘filthy lucre’, but we require our founders to have a more rounded perspective on how their business will add value to themselves, their team and society. Easy words, but it is awfully difficult to identify these characteristics in an applicant. Pizza is also a requirement for most applicants!
We have already created a significant number of really worthwhile jobs in our start-ups, however, in terms of job creation, the rapid advancement in digital technologies, and particularly machine learning, may undermine job creation. Several of our portfolio companies are already showing the signs that they will grow significantly in the next decade, but is the writing on the wall? Many of the areas that our companies are working in, if not all, their activity will directly or indirectly result in a loss of ‘traditional’ employment, the number of which will not be replaced by jobs created in the tech companies.
THE 4th INDUSTRIAL REVOLUTION
A recent NESTA report stated, ‘The current wave of technological change associated with the 4IR (4th Industrial revolution) is bound to destroy many jobs, even if expert assessments vary greatly on just how many.’ Interestingly, in NESTA’s albeit brief discussion on this topic, they offer less convincing evidence that the creation of new jobs outside of technology has been thought-through. That is why, at the Foundation, our programme focuses on value creation: creating value to support our companies and society. What new tech-based companies will hopefully facilitate is the creation of significantly more value than the jobs that their technologies will replace.
Value can be measured in many ways. At Alacrity we promote an understanding that value should be measured in the wider contribution that technology can have to society. We believe, however, that the greatest value that a tech start-up can have is to grow, create highly paid and satisfying roles and provide significant monetary contribution through taxation and capital growth. This is why we insist that our start-up teams are focused on globally scalable growth. We are aided in the projection of this message by being part of a global network of technology incubators and accelerators: the global Alacrity family. We regularly expose our founders to the commercial environments in North and South America, mainland Europe, the Middle and Far East and the Indian subcontinent. If Welsh tech companies are not thinking about developing businesses at scale and global in application, we will not see the value creation that Wales so desperately needs to raise its economic activity to levels that will support the society that we all desire.
The 4IR is already producing smart solutions with a positive impact on social outcomes. We have to rethink the workplace and our interaction with it. We have to rethink how we frame our discussions and expectations of the workplace. We have to rethink how we educate and prepare people for the workplace.
THE FUTURE’s BRIGHT
The next twenty years will see changes in technology, the workplace and society more generally that will be truly revolutionary. We at Alacrity are part of this revolution. We are focusing on those that want to establish the new companies and create the value that we need. The Foundation’s unique educational programme prepares founders for the revolution. It is now time for them to deliver. Exciting times indeed!