Last month, Bristol Tech Festival kicked off in style at 9:30am on Purpose Day with an amazing breakfast panel interview showcasing BaseKit’s inaugural micro business report: Crossing the digital divide, focussing on the question, how can we champion tech democracy for the small business economy?

They surveyed 529 micro businesses in Britain (with fewer than five employees) across numerous sectors in a YouGov survey in August 2022; in general, they found that there was still a strong digital divide in place. Most micro business owners aren’t actively seeking to use digital tools, and many don’t know who to trust to support them with digitisation.

Chaired by techSPARK’s very own Lucy Paine, the panel comprised Simon Best (CEO of BaseKit), Ash Phillips (CEO of Dffrnt), Jonathan Gaunt (Founder at FD Works), and Ian Philips (Head of Partner Sales at Xero)

Lucy began the session with some stats to set the scene: the five year survival rate of UK enterprises is 39.5% and 96% of SMEs have fewer than 10 employees. The digitisation of the business world has become all the more apparent over the past several years due to the pandemic; this accelerated digitisation can be very daunting to micro businesses, however it is now a necessary part of creating a thriving business. Please see some of the key takeaways from the panel discussion outlined below.

Key takeaways on how we can champion tech democracy

Some of the challenges facing micro business owners were highlighted:

  • Perceived lack of know-how when it comes to using digital tools (watch here). Some small business owners don’t believe they have the capability to create an online presence, however a product like BaseKit was developed mobile first, to allow organisations to build an online presence on the go, whilst integrating the ability to sell products and take bookings and connect their calendar, making this process much easier
  • Most micro businesses are so focused on their own business that they cannot find the time or resources to learn a new tool 
  • There is stark inequality and inability of some businesses to access the same opportunities and resources as others due to long-standing systemic reasons. The panel highlighted that mentors and advisors do exist within the tech community, however they are often not easy to find
  • There is also a lack of knowledge around research for digital tools (watch here). Search engines often give results for paid ads at the top, rather than the best fit, and as the cohort of business owners who are looking for these digital tools are not always the most tech savvy, they may not be willing or able to do lots of research into the best option
  • More established businesses who have not previously relied on digital tools now have an uphill battle to digitise their assets going forward
  • Technology companies are not necessarily taking the time to speak to their small business customers to really understand the problems that they face
  • Few people in the tech or software space are actually championing the needs of micro businesses

Trust and loyalty was one of the key themes of the session:

  • Micro business owners often don’t know who or what to trust when it comes to adopting digital tools; there really needs to be an education piece around this – micro businesses are so diverse that a “one size fits all” approach won’t work. The one common language across the spectrum, however, is positive outcomes for their business
  • There is a lack of faith in the technology itself and the need for change – if somebody has built their business through word of mouth, why would they need to change?
  • Customers are more likely to have confidence in a small business owner if they have a legitimate looking website and are able to quickly send an invoice or receipt via email
  • Some small businesses seem to struggle with the thought of moving to a social media / online advertising model to spread the word about their business, rather than relying on word of mouth recommendations; they don’t trust what business prospects they can’t see
  • One of the key points from the survey was loyalty; once a micro business has chosen a digital provider that they trust, they are unlikely to move away

The panel identified simple language as hugely important to adoption (watch here). There was discussion around how inherantly complicated business professionals can choose to make communciatioin to small businesses which can act as a barrier to their adoption of the great tools the ecosystem is building to make their lives easier. 

  • Jonathan in particular shared that professionals can be guilty of using big complex words to try and impress small buinsesses, yet in reality simplicty is key to engaging their custom
  • Using simple, value driven language that appeals to a very simple transaction that a small business is finding hard to handle will go a long way to changing people’s perception of how tech can help them
  • How do we ask questions and structure our answers in a way that anyone will understand?
  • Simon shared that BaseKit has seen in the hosting industry in particular, that when it comes to websites, there has been a huge transition in the way the industry communicates, from using very technical language to talking about solutions, problem solving and value to the small business owner
  • Ash said that we have an opportunity and a responsibility as players in the professional ecosystem to “advocate the right tools at the right time” to small busineses and cut through the complex noise
  • The panel also discussed whether people need to “experience” or feel that pain of not having the correct tools at the correct time to have the penny drop moment of I need to fix this and search for ways to do that instead of struggling on

How to bridge the gap between technology and micro businesses was also discussed, and it was agreed that accountants are an extremely important part of this puzzle. Accountancy is a sector that the report identified to not only be one of the most trusted by small businesses but the one they would also be most happy to buy digital tools from for the future success of their business:

  • They are viewed as a trusted advisor by micro businesses
  • They are able to reach small business owners on a scale that tech companies cannot
  • They add value to accounting products like Xero
  • Accounting must also get savvier in the way that they service micro businesses. Most don’t have the capacity to serve the number of these types of owner, and smaller businesses should also look at an accounting service as an investment in their business. Part of this shift in the role of accountants and book-keepers is through the regulation, as with quarterly VAT and tax returns, they are speaking to their accountant far more frequently
An image of a panel discussion - there are three people in the frame with a large black curtain behind them. From left to right, there is a white woman with brunette hair tied in a claw clip gesturing with her arm. She is wearing a beige long sleeve jumper with the sleeves pushed up to her elbows and blue denim jeans with a clipboard on her lap. To her right is a white man who has blonde short hair, wearing a bright green hoody and jeans, holding a mic and looking at the women whilst smiling. To his right is another white man with short brunette hair and black glasses, smiling looking down, wearing a beige crew neck jumper and jeans. He has his left leg crossed and resting his foot on his knee - he is wearing white trainers
Central focus of the image is a white man with short brown hair sitting on the orange chairs, which have yellow cushions. He is wearing a light blue button up shirt and is leaning slightly forward with a phone in his hands rested on his knees. He is looking forward with a neutral expression. He is sat amongst several other people.
A side on view of the panel and audience. There is a grey floor, and around the sides is a long black floor length curtain. To the left, the panel of 5 is sitting in a row with two large screens behind and above them. On the screen is a purple background with white writing and a QR code and the event's title
central focus is on a white woman with blonde hair. She has a fringe, the rest of her hair is tied back in a loose ponytail. She is wearing a black hoody and her arms are crossed, she is looking forward with a neutral expression. To her right is a white woman with straight dark hair, parted on the side and worn down. She is also wearing a black hoody. In the background is other people sat on the yellow and orange tiered benches. There are metal banisters in between the women and the rest of the audience.
a bald white man with a light beard, wearing a black t-shirt and jeans. His legs are crossed and he is holding a mic, mid speaking. On his left is a white man with grey hair, jeans, a grey top and a khaki shirt/jacket. In the background is a floor length black curtain and grey flooring
Audience of people sitting on a tiered bench across 7 levels, It has yellow cushioned seating and a hard orange back. Midway through there are stairs with a metal hand rail. At the top there is a black curtain

Simon wrapped up the session by informing us this is the inaugural report for an annual survey to be run by BaseKit. If you’re interested in collaborating with the team going forward, do get in touch. And make sure you download the report to see the full picture for micro business digital tool adoption in Britain.

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