Supporting entrepreneurs
Alex Macpherson - 14 June 2010
Supporting the work of entrepreneurs is integral to what we do at Octopus Ventures. And having an understanding of the different skills and talents that entrepreneurs bring to a business is vital in helping a company to develop and achieve its potential.
One basic distinction we can make is between entrepreneurs who are innovators and those who are inventors. For example, the entrepreneurs behind one of our most successful investee companies, Lovefilm, can be seen as innovators. They came up with a new way to provide an already popular and established service - DVD rentals - by inviting customers to create lists of DVDs online and receive DVDs regularly by post. This was an innovation on the established model of renting from your local Blockbuster store, based on innovative US business Netflix. With our backing, Lovefilm was established and in a few short years has changed the way in which we rent DVDs, saving customers time, effort and money.
Meanwhile there are other companies we invest in whose entrepreneurs fall into the realm of inventors. Naturally many of these are found in the realms of science and technology. For example, the team behind investee company e-Therapeutics have created a pioneering drug discovery and development business as a result of work completed at Newcastle University. They have developed their own computational systems to predict how medicines interact with cells in the body. Already a listed company and in the process of bringing products to market, e-Therapeutics has invented an entirely new way to identify compounds which prevent and cure high profile diseases that affect us and others around us, including asthma, cancer and MRSA.
However, it's rare to find an entrepreneur who has all the skills necessary to take a business full stretch. Typically, more creative individuals might not be so business minded, and ‘ideas' people might be less strong on execution. This is where recognising people's individual strengths and their weaknesses in relation to what a business needs become crucial. In turn, recognition by an entrepreneur of their personal weaknesses or what they do not like doing is a valuable attribute, enabling them and us to add new individuals to the team who can fulfill these roles.
This approach can be seen in the development of former investee company Plum Baby, from which we recently made a successful exit, generating returns for our investors. Plum Baby founder Susie Willis is a talented and highly creative entrepreneur who got the business up and running. A former chef, she had an idea for organic, ready-made baby food and developed recipes, business and brand to produce a successful range of products that were snapped up by the customer base. However, in order to ensure the continued success of the business and extend its market reach, as part of our investment we bought in Patrick Cairns as chief executive. A former Unilever boss, with extensive business experience, his skills, being complementary to Susie's, produced a combined force that drove Plum Baby's development into a high profile consumer brand now stocked throughout major supermarkets.
A high street success story like Plum Baby illustrates how entrepreneurs and their ideas can develop and how their products and services become part of our lives. From inventions to innovations it is the entrepreneur's vision that sets the path along which their business can address a new market, or revolutionise one that has stagnated. With the right support, from venture capital funding to advice around building a team and a business, more entrepreneurs can have the opportunity to be tomorrow's success stories.
