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Lancaster University is home to many students who have successful enterprises. From smoothie making to swimming clubs, we have seen just about everything. And maybe this could inspire you, too…
Maybe you have you got an amazing idea for an enterprise but just aren’t sure how to execute it’s launch? Maybe you’ve got a business mind but are a little put off by legal jargon? It all gets a little bit complicated and just the thought of all that responsibility (financial and otherwise) can cause full scale meltdowns.
But it’s really not as bad as you may think. At Lancaster University there are an abundance of places you can go to seek help. We caught up with LUSU’s Innovation Coordinator, Josh Dean, to find out exactly how you could go about setting your business idea into motion.
A student has a very shaky business idea that they scribbled on a napkin one morning before their 9am seminar, but it has a lot of potential. What can you do to help them develop their idea into a practical business model?
Most entrepreneurs don’t have ideas that are instantly recognisable as a business, they may be looking to solve a problem, fulfill a need or just seem like a great way to make money! What I try to do is encourage people to take their ideas and run with them, signposting them in the best direction for them to get support.
Why do you think that students should start a business?
Starting a business is a fantastic way to develop skills and experience, in your own time and on your own terms, not to mention the potential of making a bit of cash! Running your own enterprise, no matter what size, is pretty daunting. So whether or not you continue to be self-employed in the future, employers will recognize the individual bravery and initiative setting up a business takes.
What kind of advice can you give to students worried about balanced studying, social life, and starting a business?
It’s a tough one, but I think if you are determined enough to make your business work, you’ll find a way to balance it. Most importantly – Don’t get hung up on “not knowing anything” or thinking you “know everything”. Obviously your business (for a lot of people their passion!), should be known inside out. But legal structures, taxes, IP rights, even how to perform effective market research, are things you can learn as you go. It’s very difficult to get to the stage of a business and realize “Oops, I should have been doing that…”, usually it becomes clear when you need to find out something (partly why I’m here!).
We have access to a business advisor who will always be able to give you advice a few steps a head should you start worrying! Take your time and go at your own pace, it’s better to keep up your entrepreneurial streak than burn out too quickly!
Not everyone has the kind of money needed to kick start a business. What kind of financial support is on offer?
At LUSU we have a small pot of funding you can apply for, which is focused on giving your business a boost, whether that is equipment or marketing for example. The big trend at the moment is crowd funding, via services such as Kickstarter, Indiegogo and Patreon, where people can get funding, create a loyal fanbase and do some market research, all in one! This won’t be suitable for everyone which is why we also look to more “traditional” means of funding, such as one-off business grants (which often come with perks such as mentoring). Over the next few months we’re working on improving our advice on how to start looking for investment, with free advice available from an accountant and solicitor.
Are their many legal hoops to jump through?
I wouldn’t describe them as “hoops”, mainly because there is a reason they exist! Pretty early on you need to decide on a “legal structure” for your business, this not only ensures your business heads in the right direction from the start, but that you are protected as an individual from “risk” and responsibilities for the business are assigned appropriately.
This is the same for freelancers, who still need to register as a sole trader if you are trading, making a profit or not. Don’t let it put you off, a sole trader doesn’t have to just one person, it’s all based around legal requirements to ensure protection for both you and your customers, so it’s clear who is responsible!
Why do students need to register their business with HMRC? And how can they do this?
You need to register within 3 months of being self-employed for self-assessment and despite how it sounds, registration itself actually really easy. It can all be done online and you then file tax return to ensure you are paying the right amount of tax.You don’t have to worry about VAT until your turnover is above £79,000. If you are setting up as a company, you do need to register with Company House, which is a registrar for all UK companies and where you file accounts and company information.
If someone comes to you with an idea, can they be sure it is protected?
That’s a very complex question and many thousands of legal cases are fought over the protection of intellectual property, copyright and patents, so we try and keep it simple! Our policy is based on the idea that if two students came to me one after the other with the same idea they would get exactly the same level and quality of support. I may mention to them that there are competitors in the same market, but that’s business at the end of the day! I never want to stop point blank a business idea because someone else is doing something similar, as they may find themselves going in completely different directions, gaining valuable experience.
For those who get in touch with an idea based around some part of their academic study or research, I generally refer them to their department/faculty to discuss it further.
What is the difference between a business and a social enterprise?
One of the big misconceptions about social enterprise is that they don’t act as a business. They are still businesses in their own right, but whilst a traditional businesses exists (first and foremost) to make a profit for the owners/shareholders, a social enterprise exists to help meet a social goal/mission, and makes a profit to survive in order to continue to meet that goal. For example, The Big Issue and Jamie Oliver’s “Fifteen” restaurant both address social needs (homelessness and youth unemployment respectively), with the byproduct of creating successful businesses.
Of course, businesses have elements of Corporate Social Responsibility that begins to blur the lines somewhat, but Social Enterprises exist in the gap between profit making business and charities. We’re looking to support more of these in the future, especially if you’ve got an idea to take advantage of all the Green Lancaster projects popping up around campus.
Are there any restrictions for international students who want to be self employed?
Yes, you need to ensure your current visa allows you to be self-employed in the UK. If you are from outside the European Economic Area and are here on a Tier 4 or student visa, you are not permitted to set up a business or be self-employed. If you wish to set up a business or be self employed when you graduate, you need to apply for a Tier 1 (Entrepreneur) Visa. The University Careers service in The Base can help you get advice on this, as it’s a complex area of the law to understand.
Tell us about some of the best businesses you have helped to set up.
Oh that’s a tricky one! It’s funny because I’ve seen some sensible, well managed ideas take off and be successful, but also a load of quirky ones do really well! Bizarre Tees, ran by Damian Gray who graduated last year, was a favorite, because it was, on the face of it, a really simple business of well-designed t-shirts, but patient growth, attention to detail and striking image has led it from strength to strength. Big Fish, Little Fish swim school, ran by Laura Kenny, is a fantastic example of taking the idea of a swim school and developing it into an innovative and popular business! For me, the important thing is that regardless of how successful, innovative and unique a business is, the students/recent graduates (we support people up to two years after graduating) gain rewarding experiences and new skills from it.
I also wouldn’t say I help “set up businesses”, even if it looks like that from the outside, as for a startup business to work, it needs to have the identity and passion of the people involved pulsing through it. I just help enthusiastic and entrepreneurial people reach their potential!
Still not convinced that it’s totally do-able? Really really don’t think you’re cut out for it? Then take some tips from this guy, Richard Milnes . Currently taking a year out from university to pursue his business, he is the CEO of his company, Juliand Digital, which provides apps, and application software for clients.
Tell us a little bit about your company, and what inspired you.
I started the company originally to develop software and apps, after making the decision to close down my previous venture, Juliand Web Designs. Since then we have been developing new software concepts for our clients which is what led to us creating our flagship product, Hive.
Hive is a concept we have develop by working closely with experts in the industry. A change of just 1 or 2% of product availability can equate to millions of new sales that were previously unavailable, which is precisely what our software does. I was fascinated by the efficiency of it. Using our app thousands of people can work together simultaneously, with a joint goal of global efficiency.
You’re doing pretty well, with contracts from Unilever, Heinekein and Carlsberg. Has it been an uphill battle? And was it worth it?
It has taken a lot of hard work to reach the position I’m in, and we’ve definitely had more setbacks than successes on the way. But was it worth it? Definitely.
You were studying Computer Science, which is useful for the practical side of your enterprise but maybe not the business side. How did you cope with the difficulties you faced?
The technical side of developing software has always been a passion of mine, which was the reason I started the business. But entering the world of purchase orders, requisition documents and business cases with absolutely no experience in business administration meant a lot of mistakes were made, some of them costly. To cope with this I studied the internals of the companies closely and made sure that every piece of paperwork was to the book.
You have suspended your studies for a year. What made you decide to do this?
Trying to manage a business and a university degree at the same time was difficult to begin with. But with increasing demands from my course, and an ambitious growth strategy underway with the company it reached a point where it was no longer possible to do both. I am walking away from University so that I can dedicate all my efforts to my company and to Hive, so that I can meet the steep targets I have set out for myself.
Did you need to do much market research?
The most valuable tool I’ve found is through working closely with experts in the industry and the end clients themselves, who ultimately have the best view of what is needed in the market.
Let’s talk money. How much did you originally put into Juliand Digital to get it off the ground?
I originally invested £25 in to the company, which was the cost of registering the business with company’s house and buying our domain name. All other capitol has been raised through the work we do, starting off with small jobs that only took time, and now investing over 30k into ideas to get them of the ground.
What kind of profit margins are you looking at now and how long did it take for you to get to that point?
Currently we have signed orders that should turnover just north of 250k this calendar year, however I intend to build on this figure when we release our flagship product next month by opening up orders to everyone in our network.
Did you have much help from the university in setting up your business?
I started the business is high school, then made the evolution into Juliand Digital over the summer before freshers. However, since then I have also worked closely with LUSU enterprise and the student business support team inside the University administration. They have been invaluable in setting up meetings with people who can help me in the industry, including my business advisor Paul Billington. They have also put me in touch with some of the other great student businesses on campus.
How are you going to expand and what is next?
Changing perceptions of the company from a part time student business to a fully comprehensive corporation is my challenge for the short term. The majority of our work is currently on the Hive concept, which we are about to release to our limited pre-release candidates. Once we have perfected this concept we are hoping to make Hive the industry standard for monitoring supply chain losses thus fueling gains. This will require some rapid infrastructure development internally, but it is a process I am looking forward to beginning.
Another of our business successes on campus in Josh Riddett. Not only does he manage his own enterprises, he is also the President of the Entrepreneurship society, won IBM Business Innovation Student of The Year, and has been asked to talk to new students about how they too can succeed in the business world.
Tell us a little bit about the enterprises that you are involved in.
I have an investment group, dabble in bitcoin, sell and buy laptops, and own stocks and shares in online gaming platforms. That means that I own some land in a virtual reality, called Entropia Universe. This works because the game has a fixed monetary value for items. It was actually the world’s first ever virtual economy game, and made the first virtual millionaire. Unfortunately, that wasn’t me.
I have also joined the Kitchpack team. It’s a company that started out at Lancaster, but has now rolled out nationally to universities. We sold 1000 boxes this year, raking in £40,000 in two weeks. It sounds good, but you also have to take into consideration the realities behind running a business. Due to some communication issues, it’s been a bit of hard work.
I heard that the Entrepreneurship society started a clothing company. Can you tell me a bit about that?
You might have heard of Lancaster hats. We partnered with Pieboy, a student enterprise company, and custom designed beanie hats for the uni. We then sold them as part of an apprentice competition that I set up. Micro-businesses were created within the competition, so that each team had beanies to sell, and the goal was to create most revenue. So they could sell a beanie for £10 or for £20, and whoever got the most revenue won. The winning total actually won the biggest cash prize any Lancaster University student has ever received from a society, which was £726. They sold over 3000 beanies.
What inspired you to do this in amongst your university work?
I wanted to get my hands dirty, for me university is nothing more than a platform.
Is it hard to maintain the balance between university work, social life, looking after the society, and managing your business?
Oh yeah, it’s a hundred hour week every week, easy. I guess in first year work didn’t count, but second year I am concerned about it. It’s just that when you have such high standard you do everything yourself. It is a problem but ironically I am looking forward to coming back to uni because I’ll be less busy.
What advice would you give to a budding entrepreneur?
If you have an idea you need to move quickly. People think that if they share their idea it will get stolen, but 99% of the time the person who you tell doesn’t have the ability to execute it they way you can. If you do tell people about your idea you will get a positive response and they will help you to improve it. Most of the time you should tell everyone everything. The single most important thing in business is trust. If you can trust people in a networked environment, that’s when things start happening.