Public Services Lab Blog

What we need is Mass Localism

Daniel Oppenheimer - 16.03.2011

Government has a habit of creating a false dilemma for itself: innovative but potentially flaky or safe and dull?

Actually there are ways to capture innovation that will actually work, without taking huge risks with big sums.

According to the FT, new rules for the funding of free schools have caused "shock and panic" among free schools founders. Whereas previously school groups could get up to £200,000 funding for commissioning specialist advice, the Department for Education now requires them to present "detailed marketing, financial and curriculum proposals". The school founders think this will force them into the arms of existing providers, preventing them from innovating. The Government thinks it is merely trying to identify which groups actually have the “capability” to deliver new schools.

So this is an old dilemma for Government: flaky/innovative or solid/boring? Of course, every time Government chooses the latter. The only difference from programme to programme is the speed with which they get there. Some programmes start off trying to be flexible and reach out to new providers. Some don’t even attempt that, and from the beginning ask for the usual reassuring documentation – detailed business plans, solid-looking budgets, and of course, that magic phrase “a track record of successful delivery” – otherwise known as “no new faces please”.

I could at this point launch into the usual innovators’ tirade citing various innovation heroes (Bill Gates, Mark Zuckerberg, Sergey Brin etc) and their distinct lack of track record when they started. But that is not the answer.

Most innovators and their innovations are destined to fail. Being innovation-friendly does not mean handing out cheques to all and sundry. On the contrary, you need to select.

Our venture capital business here in NESTA looked at 500 proposals for high-tech start-ups last year, of which it identified 30 worth serious investigation, of which it invested in….three. If the DfE is handing out £200,000, it should indeed be careful who it gives it to.

But in fact the answer is not to start out by handing out anything like £200,000. In our reports “Mass Localism” and our “Guide to social challenge prizes” we set out the arguments for graduated support to would-be innovators. In the early stages of any new idea, we found that support in the shape of guidance, constructive challenge and peer networking was more important in helping to develop the proposals than financial support.

In fact, large sums can be positively harmful, as the group doesn’t (as the DfE correctly identified!) have the governance, clarity of strategy or team to handle them. Innovations don’t come into being fully-formed, with a great business plan and a clear budget. They start off half-baked. But that absolutely doesn’t mean that they don’t have the capacity to deliver a great result further down the line. They just need help to get there.