Agenda item

1.               The Chairman welcomed the Chief Executive Officer, Business Support Kent, Community Interest Company (BSK-CiC), Ms Ollis and Mr Ivanov (High Growth Coach in BSK) to the meeting and invited them to give their presentation.  Ms Ollis and Mr Ivanov welcomed the opportunity to speak to the Cabinet Committee.

2.               Ms Ollis and Mr Ivanov gave a comprehensive presentation using overheads  and highlighted the following points:-

• As a community interest company it was a non profit business based in Kent.  Its sole purpose was to help Kent companies grow and any profits that were made had to be reinvested back into the business community.
• BSK help Kent businesses to grow through offering opportunities for networking and deploying a team of trusted advisors.
• The majority of BSK’s services were free of charge as they had secured European and other public funding.
• BSK looked to work with ambitious Kent companies with something unique to offer the market place such as offering new products and ideas into the market place that could grow particularly in Europe and the global market place. The High Growth coaches were all specialists in one or more areas.
• Only 20% of the business in the UK had real substantive ambitions to grow.  In Kent 55,000 businesses were operating in the community, approximately 6% of those business had the potential to grow, equalling 3,000, and of that 3,000 approximately 20% had real substantive ambition to upscale their business.
• There were a number of factors which impinged on why businesses did not have the ambition to grow including the economic situation  Ms Ollis stated that there needed to be a culture of where “success breeds success”.  Having networks and creating events for businesses to meet and talk to one another was important.
• A key barrier to growth was accessing finance with a quarter of businesses citing this reason.
• Over the last three years High Growth Kent had generated a network of nearly 500 Kent companies, providing individual coaching support for over half of those companies and in that process creating 400 new jobs for the Kent business community and raising £40 million of investment to those businesses. BSK had also supported a small number of Kent businesses into the European market.
• Ms Ollis stressed the importance of a Coach saying that research showed that a number of businesses sought advice from a colleague or friend, accountants or lawyers but a third who looked for that advice did not do anything with it.  A Coach would help solve a particular problem that the business had at that point in time and as part of that process would improve the ability of that owner to take control, to be confident to be able to manage risk better and go forward to manage their business better.
• High Growth Kent was only working with 9% of Kent companies with growth potential.  Referring to national data, Ms Ollis advised that Kent was below average in terms of companies with growth.  Ms Ollis considered that there was potential through encouraging ambition and aspirations and good business plans, to grow businesses in Kent.
• Mr Ivanov gave 4 examples of business; PPR WIPAG, C.MECH, 2gbiopower and Nicholls, that had received assistance from High Growth coaches and gave details of how they were individually helped.  He explained that the coach’s role was to meet the business owners face to face to discuss their problems/concerns; identify where the Coach could help them; identify the quickest way to make an impact; and help them derisk their potential growth.
• Coaches worked with a wide range of businesses including start ups, existing companies and fast growing companies. To qualify for the Coaches help they had to be small medium business (SME) with up to 49 million euros turn over per year.

3.               Members were given the opportunity to make comments and ask questions which included the following:

a)         A comment was made on the 400 jobs created by the 250 businesses that High Growth Kent had been coaching on a one to one basis which was equivalent to 2 jobs per company as an average; although in some cases this was a lot higher and in others it had not yet happened.  Ms Cooper advised that these companies were being supported because of growth potential.   Many of the businesses in East Kent particularly in Discovery Park in the early days was not about taking on new staff but proving the concept of the business therefore there was a time lag in new recruitment. 

b)         Ms Ollis added that High Growth Kent had a target of 300 new jobs over the next two years and she was confident that this would be achieved.   The manufacturing sector had particular potential to create new jobs.  High Growth Kent was about to start work with a company in East Kent which had the potential to create 46 jobs once they set up their operations.  A lot of the work carried out by High Growth in East Kent currently focused on finding investment, which would eventually lead to new job creation. 

c)          A comment was made on the potential conflicts between supporting the ambitions of a private business through High Growth Kent [funded by KCC] and KCC’s position in the community when there was a potential conflict. 

d)         Mr Dance advised that as a member of the Investment Approval Board (IAB) many companies had received regeneration money in East Kent and High Growth Kent and the intervention with those companies by High Growth Kent had been successful.  He hoped that High Growth Kent would be as successful with TIGER project in North Kent.

e)         A question was posed in two parts; 1. What was the return for KCC’s investment through High Growth Kent, in those companies and if the answer was jobs what were the number of jobs? and 2. What was the scale of the investment?  Mr Hughes advised that the scale of the investment in the past 21 months was £150, 000.  For the next 2 years the agreement with High Growth Kent, which started in January 2013, was £296,000.  The prime objective was jobs and the target for those 2 years was 300 new jobs. 

f)           In reply to a question, Ms Cooper advised that for the £300,000 funding 300 jobs would be created equalling £1000 per job. This figure compared very favourably with the Expansion East Kent scheme which worked to a £8-12k figure per job. 

g)         In reply to question, Mr Ivanov explained that for every business that the Coaches met, the sole purpose was to expand the business, both their headquarters and operation, in Kent.  If they wanted to sell their products and develop internationally the Coaches would support that too.  He mentioned manufacturing businesses that had relocated to Kent from London and France who received support from High Growth Kent.

h)          In reply to a comment, Ms Ollis advised that Kent was in a unique position to attract businesses and retaining businesses in Kent when the two Regional Growth Funds came on line, offering interest free, unsecured loan financing.  She was not aware of anywhere else in the country that offered this.  Ms Ollis advised that she had worked with businesses that had looked to move out of Discovery Park that were now staying because of the finance they could access in Kent.  She considered that this opportunity should be used to drive inward investment for the development of Kent companies.

i)            A request was made for covering reports to be provided when presentations are given to the committee.

j)            In reply to a question, Ms Cooper highlighted the work that Economic Development undertook with businesses including the sector conversations to be held with manufacturing and digital sectors where businesses will come together to discuss barriers to growth.  To date barriers had been indentified as the need to better network; recruit people with the right skills, develop the local supply chains and access business support and advice. Economic Development also worked closely with business support agencies and the six key banks. In relation to Expansion East Kent and eventually for TIGER the aim was to derisk bank lending which would enable the businesses to start accessing funding.  Work was also being undertaken with BIS and UKTI regarding marketing Kent as well as Visit Kent and Locate in Kent.  It was also the role of Economic Development to look at new markets and future innovations too.

k)          Members would welcome more detail giving examples of how many jobs had been saved through the intervention of High Growth Kent.

l)            In reply to a question, Ms Cooper advised that within the draft Business Plan, in the latter part of the agenda, there was a draft job target. The number of new jobs took account of multiple interventions.  A request was made for the details of the calculation to be included in the covering report.

4.               RESOLVED that the responses to comments and questions by Members and the information provided by Ms Ollis and Mr Ivanov, High Growth Kent be noted, with thanks.