The majority of tech entrepreneurs believe the rules of doing business have changed significantly in the past year, but are they ready for the challenges that lie ahead? Research by accountancy firm, Menzies LLP, has revealed that while they are aware of the challenges that lie ahead some business owners could be working too hard or failing to seek the mentoring and specialist support needed to succeed in turbulent times.
Based on a survey of 1,003 SME owners in the UK, which included 111 tech entrepreneurs, the majority report that the rules of doing business have changed significantly in the past year and Brexit and other uncertainties mean they are likely to keep changing.
The top two ‘rule changes’ noted by tech entrepreneurs are important business decisions have become more data-driven and software and apps have made business management and accounting systems easier to deal with in-house. Other key rule changes noted by tech entrepreneurs include more near-term opportunities; less time to consider key business decisions and more time is spent scenario and contingency planning.
Stephen Hemmings, partner and head of technology at accountancy firm, Menzies LLP, said: “Entrepreneurial businesses have a much closer understanding than multinationals of how the rules of doing business have changed. This awareness combined with their size and agility has enabled many of them to adjust to the uncertain market conditions. The research shows that tech entrepreneurs are acutely aware of the need to react to changes in market demand and make business decisions more quickly. For many, the ability to lay their hands on reliable and up-to-date data in a format that is tailored to the operational needs of the business is now critical.”
With more changes on the agenda, tech entrepreneurs know they could be facing diverse risks in the year ahead. The top three risk factors identified were cash flow difficulties; the potential impact on geopolitical uncertainty on trading activity and a general lack of resources – in particular, a shortage of senior management time.
The majority of tech entrepreneurs are happy with their work life balance. However, a third (35%) admitted they sometimes find it difficult to switch off properly during their leisure time and a quarter (27%) described their work life balance as ‘completely out of control’.
“While they seem broadly happy with their work life balance, there are signs that some tech entrepreneurs may be struggling to find time to relax away from the business. Whilst staying focused is important, the most successful business owners tend to be those with a more rounded approach to life who understand what they are doing it for and plan their futures on this basis. In uncertain times, business owners need to do more, not less, of this type of forward thinking and keep their plans under review,” said Hemmings.
There are other indications that tech entrepreneurs may be feeling stretched. The majority say they lack support and feel they are running their business alone, on average, more than twice per week.
“The research shows that some tech entrepreneurs feel isolated. Better signposting to mentoring and other business support services may be required,” added Hemmings.