Odds stacked against emerging businesses
More and more these days, I find myself not only giving thanks to the Man upstairs for life, family and good health, but also thanking, in a very secular way, the inventors of the personal computer era in which we all work these days.
People such as Steve Jobs, the Google founders, and, okay, in my more generous moments, Bill Gates.
And whoever invented the Internet. Someone just told me it wasn’t Al Gore.
The global computer network, which has become ubiquitous in many countries, and is gradually getting there in Barbados, and, with more Wi-Fi hotspots coming on stream, has made it possible for me to do serious work almost anywhere.
Anywhere, to me, is limited only to places that have good coffee.
My office can therefore be anywhere I need it to be and this is great for me as I have both a “small” business (but one that thinks big – sorry, that was an ad) and I follow the hardy trail of journalism.
I feel at home wherever I can connect to the Internet, from my phone, laptop, iPad, or back at the office, desktop computer.
I am writing this because I am not alone; the future of this country now rests in the hands of a new generation of much younger people who do what I do as regards the Internet, but often at a much higher level of tech implementation.
This large, enlightened group of young professionals – and I am not using the word professional in just the traditional sense – are making their way with much day-to-day difficulty in a business culture that makes money off them but does not fully understand or cater to them.
For example, we still have that terrible term I just used on myself – small business – which is as pejorative as a term can be. What do you think of when you say “small business”? Just the opposite of where most of them really are in their own self-image.
Knowing this, the policymakers would prefer that they be called SMEs, for small-to-medium-sized enterprises. But that somehow compounds the problem, even if it is well-meaning. They are just business people.
The wicked profits being made by the financial institutions in our midst are partly due to a short-sighted policy, that of extracting as much as possible out of the micro-business sector (there, another term to conjure with).
Meantime, the possibility of these businesses, which are really only proving grounds for the talent and ability of their chief cooks and bottle washers (CEOs), growing into big businesses are at the lower end of the possibility scale.
Far more likely that they will be sucked up, appended, acquired, conjoined or pushed out of the way by the bigger ones with assets, retained earnings and little innovative talents of their own.
Now, this is what scientists call natural selection, the survival of the fittest, so I am not knocking it entirely.
But with few avenues for start-up capital in this country, the guy with the idea usually has to fold his tent first, rather than have the chance of growing big enough and acquiring a war chest of investor money to start doing a little predatory activity of his own.
Like Google, which makes most of its money from its US$22 billion in acquisitions over the last 15 years, despite having its own revolutionary product. Or Facebook, which refused to be acquired and now does its own, as in Instagram and others.
The financial glass ceiling for start-ups which we have here is not good for refreshing the system. It only keeps the old boys network flourishing, changing as slowly as possible to meet the competition from abroad, which is much sharper because of all I have described above being a part of their market process.
With few exceptions, home-grown companies do not make it in Barbados. And old, slow and laid-back ones also fall while the young ones hardly ever come up to replace them.
I can apply what I am saying to almost every, if not every, business sector and name names (now, would I do that?), but just to focus on one where we are facing a disaster that could possibly hurt the entire economy for years to come, I would say it is the renewable energy sector.
You only had to be at last week’s Barbados Chamber of Commerce and Industry’s (BCCI) luncheon-seminar, or whatever it was called, to see this happening right before your eyes.
Here you have the classic case of the old tech run by the old boys trying to gerrymander the emerging marketplace of new tech to suit and entrench their position, and the consumer be patronized, if not damned.
You could hear the frustration and annoyance in the questions lobbed up to the panels from time to time, but these legitimate discussion points were not pursued. Nobody would dare do that at a BCCI luncheon.
The upshot of all this is that if the old energy school prevails, Barbados will suffer as a consequence because it will not be able to pass on the savings offered by renewable energy tech to a large enough base of households and business premises to make a real reduction in the cost of doing business.
This would mean that one of the few ways in which we can pass on savings to the customer as well as retain some for our bottom lines will be lost to all, and the economy will not be able to take advantage of technology which could make us more competitive as a country.
I hope the Young Turks can prevail but the odds seem to be stacked against them.