‘Where’s the restless ambition we so often see with American founders?’ do UK start-ups sell too soon?
In his new book ‘Pioneers Wanted’, Innovation Consultant Philip J.A Clarke has laid out his blueprint for how leaders in the business world can think like pioneers.
As part of this, he has questioned the quick exit culture that many say exists in the UK and Europe, compared to the USA.
He says: “Analysts and commentators have suspected that European start-ups often sell too soon. Where’s the restless ambition we so often see with American founders?
“When McKesson bought the British pharmaceuticals start-up Echo in 2019, it was only four years old. CEO Roger Hassan defended the seemingly early sale with the lukewarm platitude that ‘We don’t have any unhappy investors… nobody’s lost money on the deal’. Echo isn’t alone.
“Amsterdam-based Booking.com now generates over €7bn in annual revenue, but for over a decade its profits have ultimately gone to Priceline.com in Connecticut, United States, to whom they sold in 2005. Finish gaming company Supercell now makes its €5m daily profits for its owners Tencent in Shenzen, China after a sell-on by a Japanese conglomerate.
“Frankly, after Nokia and Spotify, European entrepreneurs haven’t produced anything else with truly global name recognition. When the offer of a sale comes along, all too often they run into the loving arms of a global giant to seek respite from the fast-paced, high-risk world of start-ups. The motivations – huge riches, less responsibility, access to more and larger markets – are easy to understand. The consequences, however, are the perpetuation of this small-game mentality, a desire to shy away from the fight and seek comfort. While small-game leaders sell out, big game leaders keep building until they make a dent in the world.
Clarke continues: “Pioneers measure success by the size of the change they effect, not by either/or criteria. They focus on achievement for the sake of the vision they have, not their own ego. They’re not necessarily interested in how many units they sell or how many people agree with them. They might even endure significant financial, reputational, or political costs in pursuing the level of systemic change their vision demands.
“To the pioneer, success lies in one thing only: making an impact on the world. If you’re thinking in terms of annual turnover, number of consumers, recognition, or awards, you’re thinking too small.
“If the world is not going to be qualitatively different to what it was before you started, your idea isn’t big enough. And if we’re satisfied with selling out before we breakthrough, we’re not true pioneers. Success to a pioneer is radical, recognisable, universal change.”