Is Durham University failing its entrepreneurs?

The rise of self-employment has been a key characteristic of western economies since the turn of the century. In the United Kingdom, the number of self-employed people rose from 3.3 million in 2001 to 4.8 million in 2017. 

Entrepreneurship is key to the growth of the economy as a whole. Entrepreneurs inherently start new businesses adding to the national income, innovation and growth of a nation. They are also key to creating social change. Facebook, for example, has revolutionised the way in which people interact.

These startup businesses also often work closely with local communities helping to develop the skills of the local people and provide them with unique opportunities. Entrepreneurship is key to defusing wealth concentration and increasing social mobility. Without new startups, older firms wouldn’t be forced to innovate and their inefficiency would not be challenged.

Entrepreneurship is at the heart of our modern economy and pushes us all forward. 

Key to the success of entrepreneurs is their level of education and startup support. Universities are centralised institutions housing some of the greatest young talent and future entrepreneurs responsible for driving forth our economy for decades to come.

It is for this reason that it is not only logical but morally obligatory that universities provide the resources and support to harness this talent as efficiently as possible encouraging entrepreneurship and allowing their students’ innovative businesses to lead us into the future.

Durham University is a top 100 world university with incredibly talented students many of whom have great aspirations to start their own businesses and companies promoting new ideas and challenging the norm. Unfortunately, the university prohibits these students from obtaining the support which they require to successfully launch their businesses.

Should a student at Durham University decide to found an enterprise, they are limited to £500 in funding for their venture through the KickStart Fund. This support pales in comparison to other universities such as Newcastle University who offer START UP Founderships of £7,500, Oxford University which offers between £15,000 and £25,000  for student start-ups and Cambridge University which can offer between £20,000 and £1,000,000 in startup funding. (Additional figures are provided below).

Speaking to Durham University students on the topic there was a consistent malcontent with the university and the support they offer. One student disclosed that they had received more support from other students and student-led societies than from the enterprise centre and the university itself.

Another student pointed out that the lack of a workspace to grow their business greatly prohibited them from achieving their goals.

Finally, we heard from a student at Durham University who was receiving funding and support from Teesside University because Durham had been unable to adequately support them. Many more students we spoke to asked not to have their comments included for fear of potential backlash from the university.

Inefficiency is our nemesis here at Ichor. Our company does not accept that our society should be content with wasting our limited resources. A university which cannot harness the knowledge of its students, promote their work and support their enterprises has failed us all.

Human capital is a valuable asset to all of society and it should be valued and nurtured by academic institutions. The role of a university is not to increase its profits or impress its donors but instead to build its students into valuable members of society who can innovate, produce and grow. It is clear that Durham University is failing in its task.

All information provided has been verified on each University’s webpage. Any inability to confirm support or workspaces through the Universities advertised site led to the exclusion of that University from our research.

Responding to this research Alan Houston, Pro-Vice Chancellor for Education at Durham University, commented:

“We are investing significantly in supporting student enterprise – which is a key focus of our University Strategy. We have a number of high quality initiatives in place to support student enterprise and the success of these is clear in the calibre of our award-winning student entrepreneurs and the start-up businesses that begin here at Durham University.

“We aim to equip our students with the skills they require to create viable, sustainable and scalable businesses. To do this we have a dedicated Enterprise team who provide one-to-one specialist business coaching, workshops, enterprise competitions, a large number of networking opportunities, and connections to external providers of support and finance. The Kickstart Fund is also in place to encourage students to explore ideas at the early stages of their business development.

“We are constantly looking for ways in which we can further support our students and their business ideas. Whilst expanding our current services – with more advisors, events and connections with organisations across the North East – we are also working on a number of new initiatives, which include creating new workspaces, support programmes and bespoke student enterprise facilities.”

The University is making progress to ensure that student entrepreneurs have access to the support they need, including workspace.

Upcoming projects include:

• Collaboration with Durham County Council and New College Durham to deliver an ERDF funded Durham City Incubator (DCI) project which will provide start-up grants to businesses and a fully supported accelerator programme and funded workspace.
• A new Student Enterprise Hub will create a bespoke facility to house student enterprise activity. The new space represents c.£1 million of investment into student enterprise at Durham University.

Durham University also aim to build on the existing success of their student enterprise support programme.

In the upcoming academic year they will:

• Increase the number of business adviser hours to meet rising demand
• Roll out a series of student entrepreneurship networking events which was successfully piloted at the end of the last academic year
• Bringing more external guest speakers and investors on campus than ever before to deliver workshops and provide one-to-one support
• Collaborate with other Universities, funders and business support organisations to ensure Durham University students have access to the best support available in the North East.

Having summarised all the initiatives being proposed by the University and reading the Pro Vice-Chancellor’s comments we would like to issue a reply of our own.

The research Ichor published looked specifically at funding for student enterprise as its central issue. Papers by esteemed academics such as Alex Coad, Julian Frankish, Richard Roberts and David Storey show that the sole indicator of success for start-ups in a survey of 6246 was the finances available to them.

Although the university fails to acknowledge this, its common knowledge within the academic literature on this topic that the types of programs being run by the university have no statistically proven significance when evaluating the success of start-ups.

To see the proof of success of programmes which directly provide substantial cash to student start-ups, the Vice-Chancellor need not do much more than take a 15-minute train to Newcastle, a university ranked over 15 spots below Durham. Their Startup program which sees funding provided to student entrepreneurs in the exact manner academic literature would suggest has seen 179 businesses immerge from the university with an annual turnover of £26.8M, over £9M in external investment gained and 449 full time jobs created. 

For any readers believing that this is simply a matter of a university and its students debating over how funds should be allocated. 449 full time jobs created has a significant effect on the local community. This is an issue that directly affects everyone in Durham and the North East. An area of the country which for too long has been left behind by Westminster cannot afford to also have one of its biggest institutions failing to provide the support that could help to rejuvenate the local economy.

The programmes being promoted by the Vice-Chancellor are but justification for their lack of true investment in students and the community. The £1 million figure, for example, is simply the cost of building a floor in a new building which had already been planned before the decision was made to make it available to enterprising students.

This £1 million was already earmarked to be spent on that building and if not for the pressure put on the university throughout the past year, especially by specific students already on our team, no space would currently be allocated for enterprise.

That one of the top universities in the country has not researched what trends exist in student enterprise support and what services they should offer to provide real change in the entrepreneurial success and culture at Durham University.

When their position on music facilities, mental health, enterprise support and other key aspects of student life (where Durham often ranks far lower than the University cares to admit) is always, ‘we will fix that in 5 years with our University Strategy’ at some point a stand needs to be taken and policies to help students today put in place.

(Interestingly, having attended some of those networking events promoted by the University, they often feature successful entrepreneurs from Teesside and Newcastle Universities. A quick glance at the University rankings shows that there is clearly something wrong when the 22nd and 92nd ranked universities outperform the 6th rank in successful student businesses)

Durham is lucky enough to have some of the brightest minds in the country and with many of us being members of the university community we want nothing more than to see student businesses succeed and the local North East community to prosper.

As we’ve said before we at Ichor are ready to tackle these inefficiencies no matter the culprit and we hope to hear back from the university with an adequate reply. After all, they should be willing to engage in communications with its students, it’s common sense.