The piece was all about the importance of small businesses. It argued there is a passion and engagement within a small business that large corporations can only envy.
Having experienced the amazing customer service inside, I agree with it (customer service in the States – it’s unbeatable).
I like the individuality of owner-managed businesses. I don’t want to go into a shop or restaurant that’s just a faceless entity. I’d rather stay at boutique hotel than a bland chain, and I eat in family restaurants when I can.
Unfortunately, lenders, landlords, and even some brokers are biased towards large businesses - they see them as more reliable and creditworthy. But small companies enjoy a lot of advantages.
They are much more flexible than larger concerns and they generally have lower central costs. They are also more nimble; new ideas don’t flourish in a bureaucracy - defined by Balzac as a "giant mechanism operated by pygmies".
They may lack buying power and a well-known brand, but they will not have burdens like greedy private equity house shareholders or pension deficits.
I fear the complications and conflicts that arise as you expand a company from small beginnings to something much larger and more profitable.
At the moment, West One Loans is an intimate and highly adaptable organism. But as it expands, there will be an inevitable tendency for the journey to become more cautious and boring.
I can see it elsewhere in the market. Motivation is gradually diluted as the middle managers take over. Progress is about replication rather than adventure.
When banks and private equity backers get involved, the distinctive features fade, to be replaced by the treadmill of financial returns. It’s an almost inevitable sequence.
Yet the future might just belong to agile private operations like ourselves, not giant corporations.
Massive, cumbersome outfits such as Lehman Brothers and, most recently, UBS have proved that, in spite of their enormous resources and economies of scale, they can still go catastrophically wrong.
I accept that many industrial activities can only be carried out by huge concerns with substantial capital. Steel production. Utilities. Big Pharma. But I don’t have a lot of affection for those dull empires.
They’re about conformity rather than disruption.
Of course, I believe in free-market capitalism and ambition - but I also enjoy the spirit, invention, and guts that small businesses bring to any field.
We punch above our weight in terms of broker service, and in doing so we force big players to up their game. In these uncertain times, there is every reason to believe - in spite of the relentless march of globalisation - that the small companies of the world will continue to thrive.
DK
