I was fascinated to see some recent research published by business software and services provider Sage that suggested that whilst British entrepreneurialism is thriving, the term itself has fallen out of fashion. According their survey of 1,200 SMEs in the UK “business owner” (53%), “self-employed” (26%) and “businessman/woman” (15%) are the most popular terms people use to describe themselves. Just 4% of small business owners think of themselves as entrepreneurs.
I have been thinking a lot about the language we use to describe business and what we do recently. At BGF we are equity investors. We invest our money in growing businesses in return for a stake in the company and a seat on the Board. Yet the common parlance means businesses, and many advisers, will talk about “giving away equity”, not selling it.
The issue isn’t always about the way we use words and phrases, sometimes the problem is we simply don’t have the words at all. For example, there are so many different definitions of an SME (small and medium sized enterprise) that the term has almost become worthless as a useful descriptor. What we don’t have is the language to describe the different firms that fall within the broader definition. It is a much asked question, but where is the English equivalent of the German mittelstand?
Does any of this matter? Shouldn’t we be more worried about growing the companies, rather than what we call them? I believe they both matter.
The language we use says a great deal about the time and respect we have for these companies. It is very easy to suggest that Britain’s mid-sized(?) companies have been all but forgotten by policy-makers, and the financial services industry, when they don’t even enjoy a collective name. How can we promote greater financial and business literacy when the common parlance is inconsistent, confused and often just plain wrong? And how can we encourage greater entrepreneurship when we shy away from even using the word to describe success?
Language can also provide an important sense of belonging and purpose. This is particularly relevant for entrepreneurs with growing businesses. Running a business can be isolating experience. Knowing you are part of something bigger, that you are respected and that people recognise the challenges you face and want to help you succeed may not make the journey any easier, but it may help more entrepreneurs stay the course. And an acknowledged lexicon would also aid better understanding and appreciation of these businesses among politicians, policy-makers, the media and the wider business community.
So where do we start? Well how about finding the British equivalent of the term mittelstand? What do you think?