Introduction to Ufi Ventures
Blog by Joe Ludlow, Impact Investment Director for Ufi Trust
New technologies will force at least half of us to retrain in the next three years and the threats this presents are quite large - but how can we use technology to develop the skills people need for this future of work?
We’ve established Ufi Ventures to invest in companies developing digital technologies that give people and businesses the skills needed for work, now and in the future.
The Fourth Industrial Revolution is now in full swing: new consumer expectations are emerging, new products, new processes, new business models, and new financing mechanisms are being developed in response. All industries are being disrupted: 75m jobs may be lost globally whilst 1.5 times that number could be created.
Although disruptive and often threatening to existing patterns of life, business and work, this “gale of creative destruction” (to quote Schumpeter from 1942) has blown through economies and societies before. The challenge for individuals, companies and countries like the UK is to prepare and respond so we may benefit from the creation and not just suffer the destruction. When it comes to people and work, we need to leverage new technology to build the skills and capabilities needed in the growth markets of this generation, whether that be clean energy, autonomous vehicles, biotechnology or social care.
Ufi Ventures will be looking to invest in ventures developing digital services which boost the supply of high-demand vocational skills.
However, setting aside the challenges brought about by rapid technological change, we must also recognise that work has not been working well for people or businesses in the UK for some time.
For businesses and the economy, the so-called 'productivity puzzle' means that since 2008 in the UK, the output of firms per hour worked has flatlined, and so on average firms are 25% less productive than they might have been if the pre-2008 trend had continued. A small number of companies across UK regions and sectors have bucked this trend: 1% of firms delivered an aggregate 8% year-on-year productivity growth in the period 2004-2014. But 99% of UK companies managed only 1% pa.
Workforce skills development is often seen as key to productivity growth, but to realise the benefits businesses also need the management and operating capability to build and use higher skills. So Ufi Ventures will also be looking to invest in ventures that are building technologies that help businesses to realise value from a higher skilled workforce.
The consequence of stagnant productivity has been little to no growth in average wages and living standards, felt most acutely by those on lower incomes. The Joseph Rowntree Foundation’s important work on in-work poverty has shown that the number of people in work and in poverty in the UK has risen by half a million in five years to four million, and the in-work poverty rate is the highest it has been in the last 20 years. Building functional skills for work can help people find high quality work and progress within it; we think there’s opportunity for ventures to take a radical look at how this works and at what functional skills and capabilities are needed in the modern and future workplace.
Ufi has been working for over five years to test and demonstrate the potential of emerging digital technologies to support skills for work and drive better business performance. We’ve been building on our long history as a pioneer in vocational learning with digital technology. This experience demonstrates how improving the skills of people at work creates value in businesses and helps people to realise better outcomes in and outside of work: It creates real social, economic and financial value.
Ufi has created a new team, Ufi Ventures, to use our experience in digital technologies, work related learning and in early-stage investing to make investments which pursue both our mission and healthy financial returns.
We’d love to hear from ventures using digital to build skills for work, and other investors and funders keen to explore this field in collaboration with us. Get in contact with us via our dedicated Ufi Ventures page (new window).
Note from Stephen Hinde, Community Manager for Ufi Trust
To ensure that our messages are being delivered to the right people at the right time there is a new Twitter account for Ufi Ventures which will deliver news, updates, and engage with other users spefically with Ufi Ventures in mind. You can find Ufi Ventures on Twitter at @UfiVentures
The Ufi Ventures team will be attending London EdTech Week 17th-24th June 2019. If you would you like to look at the possiblities of meeting up for a conversation please fill in the contact form and use the 'What We Should Know' section.