Special report: Jimmy McLoughlin on entrepreneurialism
By CA magazine
6 July 2023
Jimmy McLoughlin’s goal is to be the ‘Martin Lewis of jobs’. He discusses with Lysanne Currie the state of entrepreneurship, how to get the UK back on the path to growth and why business needs its own Mick Lynch
Being an entrepreneur has never been easier. But also, with the cost-of-living crisis, it’s never been harder.” So says lobbyist-turned-podcaster Jimmy McLoughlin, who back in 2016 was brought into Theresa May’s No 10 as the voice of business, a “29-year-old policy wonk”, as The Times called him.
His appointment signalled a change of direction for Downing Street: the son of Conservative party Chairman and former Transport Secretary, Sir (now Lord) Patrick McLoughlin, he was to bring a fresh perspective to the government’s approach to business. An advocate of digital adoption, flexible working and the sharing economy, representing the views of millennials, his role included engaging with entrepreneurs and small businesses and promoting equity crowdfunding. He was seen then, as now, as pragmatic and analytical, favouring private enterprise and deregulation but without an overarching ideological bias.
These days, his podcast Jimmy’s Jobs of the Future gives a platform to top entrepreneurs and thought leaders to opine on the future of our economy. Now in its sixth series, its guests have included Gymshark’s Ben Francis, Ruth Handcock of Octopus Investments and Giles English, co-founder of Bremont. The show’s remit has also widened to more macro matters, with recent guests including Andrew Bailey, Governor of the Bank of England, and then-Chancellor Rishi Sunak.
It’s an interesting time for start-ups in the UK. According to the Global Entrepreneurship Monitor, in 2021 the UK experienced something of a boom in entrepreneurial activity, with the Total Early-stage Entrepreneurial Activity (TEA) rate reaching its highest level since the late 1990s, due in part to the pandemic. Today, entrepreneurship in the UK is still thriving, with 500,000–700,000 new businesses started each year (though about 20% fail within their first year, and 60% within the first three).
For female entrepreneurs (almost one-third of entrepreneurs in the UK are women) there are added challenges. As the Daily Telegraph reports, women receive a disproportionately small portion of the available capital. Sexism plays a role, with women often not being taken seriously or facing differential treatment when pitching to investors, as does juggling childcare responsibilities with running a business.
Currently, as Jimmy says, the cost-of-living crisis is causing added headaches for many: “Everyone is finding it really tough… and everyone has a low-level anxiety about money. When was the last time you were pleasantly surprised by how cheap something was? It just doesn’t happen at the moment. Budgets are being squeezed and everyone is feeling the pinch more – and that is true for even the most resilient and optimistic entrepreneur.”
But, outside pressures don’t hamper the entrepreneurial spirit, he insists. “Good ideas don’t stop just because there’s an economic downturn,” he says. “If anything, there’s probably better ideas being created. Lots of companies were created out of the last financial crisis in 2008. And, ultimately, we’ll see lots more – that is my hope. But it does take a long time to build great businesses.”
Finding funding
While the ideas may still be flowing, however, the money is slowing down. Jimmy admits it’s a lot harder – and with interest rate rises, more expensive – to raise money than it was in the immediate post-pandemic era: “At the end of 2020, into 2021 and 2022, there was loads of money in the system. And people were able to raise lots of it. That’s really changed since the end of last year. It’s a challenge: people aren’t writing cheques as freely and as easily as they were. But that’s not necessarily a bad thing. Having a recalibration of where things are is probably a good thing overall.”
It’s not just funding that is an issue for entrepreneurs in the UK, though – one of the other main challenges is the talent gap. That’s one of the reasons why Jimmy started the podcast. “The story of Jimmy’s Jobs of the Future is the story of me,” he says. “I left Downing Street in the autumn of 2019. We were starting a family and I wasn’t sure what I was going to do next, but I explained to Boris Johnson that I wasn’t going to be both a good Spad and a good dad. It was time for me to do something else. I travelled with my family to California, and at the start of 2020 I studied at Stanford University for a few months.
“In March 2020, we got back to the UK on one of the last flights before lockdown. My wife, who is a doctor, went back to work and I became a stay-at-home dad. In a matter of months my life had changed from flying around the world on an RAF Voyager with the Prime Minister to being home alone with my six-month-old daughter for 12 hours a day. It was the worst time to doom scroll, so we listened to podcasts instead.”
Jimmy realised that the business media was giving more air time and column inches to job losses than it was to the good news – entrepreneurs creating jobs. “Debenhams closing with the loss of 12,000 jobs obviously generated bigger headlines than an entrepreneur creating six or 12 jobs a time,” he says. “I began to think, ‘Is there something I can do in terms of helping with the unemployment crisis that will come?’ The Today programme has 12 minutes of business news but no one was doing long-form interviews with entrepreneurs to unpack these stories. That’s where the idea for Jimmy’s Jobs of the Future came from –entrepreneurs talking about where the economy is going, aimed at 25–35-year-olds, in their first or second job, who are thinking about what they want to do next but unsure as to where their skills can be applied. The way people make income is changing and we wanted to help people navigate that.”
Jimmy cites Herman Narula, co-founder and CEO of Improbable Worlds, who was a guest on the show. “He said that the boomer generation will have earned their first money on newspaper rounds, millennials through hospitality, but the generation coming through now will earn their first pounds through online. I find it fascinating that we now have influencers, TikTok and people making a living from a YouTube channel giving fantasy football tips,” he says.
Jimmy adds he is “trying to make careers guidance exciting and interesting”, because there’s a paradox at the heart of entrepreneurship: “It’s never been easier to make it in the world. There’s never been more opportunities for young people. But the number of opportunities out there actually end up being counterproductive,” he says. “And that’s why we do what we do, to try and explain all the different jobs that are out there.”
Room for growth
Jimmy is positive about the future in the UK. “There’s a lot of exciting work happening here,” he says, “especially in the life sciences, space and deep tech areas. And drones are a fascinating sector to watch.” He is also a big supporter of the creative economy. “The UK is a world leader in TV and film and video games – and there are now so many interesting and clever people building impressive businesses on digital platforms such as YouTube.”
Jimmy believes, though, that there is still much work to be done in motivating and educating young people about the skills they need to join such sectors.
“When I visit schools and ask the classroom, ‘Who wants to work at Google, Amazon, or Facebook?’, half the room will put their hands up. But when you ask, ‘Okay, well, how many of you are thinking of studying engineering?’, just a couple of hands go up. There is a lack of understanding about the skills that go into making up these companies.”
“The motivation for young people to find work they love is a big challenge,” he says, especially for younger generations who have a different relationship with work or the office. “There used to be a social element: pre-pandemic, much of our social lives was built into work. You went out with your colleagues, you lived and breathed as a team. But that’s not happening now, partly because of this hybrid office setting, and partly because young people can now socialise on their phones. This can be hard for an entrepreneur trying to build a great culture and forge a team together. One of the trends I’m seeing emerge is the reinvention of the ‘awayday’, the thinking being that if we’re not going to be spending 40 hours together in the week, let’s try and carve out some time together.”
Jimmy believes strongly that the UK’s entrepreneurial community needs a voice to shout their corner. “Weirdly, at the head of government are two people who get entrepreneurialism – Hunt and Sunak have both done it themselves, they both kind of get it, but something isn’t quite working at the moment,” he muses. “The lines of communication between the business community and the government are all off slightly. I’d love to see politicians cite more entrepreneurs and entrepreneurial stories, but there’s a disconnect.”
So, what or who is the answer? The reply, coming from a former Conservative adviser, may surprise you. “Business needs a Mick Lynch!” he says. “Whatever you think of him and the unions, the guy’s an effective communicator, and is out there just being ‘one of us’. That’s what business needs – to be understood and to have their voice and ideas heard. Entrepreneurs are crucial to the UK economy.”
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