Why starting a business in the North comes with plenty of obstacles: Rashmi Dubé

Starting a business in Northern England filled with both challenges and opportunities. Setting up a company is no small feat and the region you do it in can significantly influence the journey.

The north of England is rich in heritage and industry and has long been seen as an emerging hub for innovation, with growing sectors like digital tech, green energy, and advanced manufacturing. Yet, despite the advantages offered by this region, it still has unique challenges.

While the North boasts a rich cultural landscape, an affordable cost of living, and access to several research institutions, it is left lacking in critical areas like legal support and diversity initiatives, creating obstacles for many early-stage companies. What I do love about starting a business in the North are some of the advantages, such as lower costs for office spaces, operations and wages and legal fees.

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Yorkshire also excels in aspects critical for many tech start-ups, whose success depends on high-speed communication and collaboration. Leeds has established itself as a FinTech hub, with several successful companies sprouting up thanks to strong digital infrastructure and proximity to established financial services firms.

Rashmi Dubé is a partner at corporate law firm Gunnercooke. Photo by Steve KraittRashmi Dubé is a partner at corporate law firm Gunnercooke. Photo by Steve Kraitt
Rashmi Dubé is a partner at corporate law firm Gunnercooke. Photo by Steve Kraitt

The region is also home to several leading universities, fostering a fertile environment for research-based start-ups. Collaborations between academic institutions and industry provide ample opportunities for innovation and partnerships.

But start-ups in the North also face significant hurdles, particularly in areas like legal and financial support. One major issue is the high cost of legal services, which are crucial for any new business navigating contracts, intellectual property protection, and data and compliance issues.

Any start-up wanting to have any form of customer/user base will have data from day one and navigating the maze alone without assistance is frankly unthinkable. As a startup, I resent the monies I have to spend on the guidance but know it is fundamental to my success. Often a start-up is operating on a shoestring budget and this can be a major barrier.

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An even more pervasive issue that northern start-ups grapple with is the continued presence of gender and minority bias in the business ecosystem.

Investors and venture capitalists all tend to sing from the same hymn sheet, saying they will invest with people of differing backgrounds and lived experiences. But a recent McKinsey report would beg to differ. It found there was evidence to show ethnic minority and female founders receive less than two per cent of venture capital funding.

For female entrepreneurs in the North, breaking into the existing networks of venture capitalists and angel investors can be challenging. Many funding networks are male-dominated, and unconscious bias continues to influence decisions. The lack of representation of women and minority groups means the North is missing out on untapped potential.

Similarly, entrepreneurs from ethnic minority backgrounds face their own challenges. Lack of representation in leadership roles, and bias in funding decisions all contribute to a disproportionately difficult journey for minority-owned start-ups.

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Initiatives designed to support diversity in business have yet to make a substantial impact, leaving many aspiring entrepreneurs feeling isolated or underserved.

To create a more supportive environment for start-ups, particularly those led by women and minorities, the North needs a more structured approach to inclusion.

Local government and private sector partnerships could play a pivotal role in providing accessible legal services and fostering diversity initiatives. Start-ups will continue to grow and as technology changes, more ideas will come to the forefront. The question is with the allure of other countries such as Dubai, how much is the country willing to lose in the long term?

Rashmi Dubé is a partner at gunnercooke

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