Start me up: harnessing SME ingenuity in the public sector

CivTech was launched in 2016 by the Scottish Government and is regarded as the world’s first Government-run accelerator for GovTech start-ups and early-stage businesses focused on improving public services.

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Transforming ideas into commercially viable products, the flagship programme was born to apply private sector innovation to public sector priorities. Whilst 90% of CivTech’s vendor applicants are start-ups and SMEs, CivTech is open to all individuals, informal teams, charities and academics who believe they have an idea that can help the government solve some of their challenges.

Deputy Programme Director at CivTech, Barbara Mills, sat down with us to discuss how to get the best out of small business partnerships, innovation in the rural landscape, and what to expect from CivTech’s Round 10 Challenges.

Dual mission

Barbara MillsMills, who herself once belonged to the start-up world, has worked for CivTech for the past seven years, leading the operational delivery team of CivTech’s ‘Challenges’.

Alongside the Programme Director, Mills also shapes CivTech’s strategic model, developing partnerships and delivering against the key priorities of the Scottish government. She describes CivTech as carrying a dual mission.

“We want to bring opportunities to the public sector organisations to solve their problems and improve their services but we also aim to help innovative people build products, businesses, jobs and leverage investment. Sometimes, it can feel like there’s a clash between the public and private sector, but CivTech is unique in making the most of sectoral collaboration and our track record demonstrates that we’re really effective in that,” Mills shared.

The CivTech edge

When CivTech first began, many of the problems CivTech were solving for the Scottish public sector were what Mills admits were ‘nice to haves’. Now introducing the Round 10 Challenges, CivTech has become a far more crucial organisation, as Scotland’s 2021-2024 digital progress report has highlighted. 

“There has definitely been an evolution in the problems we’re trying to solve. Our most recent cohort had challenges in the space of mailbox and communications, making digital identity services more accessible and improving access to women's health services. Though there can often be friction between the public and private sector, CivTech has been an effective enabler by ensuring that they meet in the middle through agile principles.”

When asked to give us a preview of what to anticipate from Round 10 Challenges, Mills indicated diversity would be a key feature. Having already engaged with new government sponsors and an anticipated launch by late July, the focus will encompass blue light services, the circular economy, and government-citizen consultation processes.

She added, “while we do take a problem-first approach, we know that there is huge potential in AI to tackle some of the problems the government is facing and so we predict it will be part of the toolkit the vendors will be using”.

SME procurement

Some of the most innovative thinking in the public sector may well be drawn from start-ups and SMEs - but government procurement and legal departments also need to have the ability to engage with small, early-stage teams.

“Placing rigid pre qualifying requirements on a start-up and designing procurement specifications for a solution that doesn’t exist yet is too restrictive and won’t harness the full potential of a small vendor,” Mills advises. Instead, government organisations should focus on becoming the experts in the problem they’re trying to solve and investing in commercial teams that have the knowledge and skills of the R&D space.

“The advice of commercial colleagues will be critical in reshaping your approach to maximise the potential of a startup or SME to deliver on the unique challenges the government faces”. 

Facing failure

90% of the businesses CivTech’ works with are SMEs or start-ups and their programme is as well regarded as it is intensive.

“Our programme comes with no guarantees but learning to fail is part and parcel of the innovation process. Our Accelerator stage, which tries to establish a minimum viable product, is about testing how robust a solution is in harsh conditions”. 

In CivTech's analysis of selections, "one in three of the vendors who apply to CivTech who are in last place going into the Exploration Stage, end up in first place by the end of it and it’s because typically, those are the organisations that can work in a way that is responsive, pivot their idea to new information and engage with the users of the public services they’re trying to improve.”

Mission-based programmes

One of the programmes Mills has had most involvement with, was Innovate for Nature, a partnership with Nature Scot which took a ‘mission-based approach’ to tackling issues such as developing quantifiable outcomes from nature project investment to measure impact and build trust that goes beyond carbon and supporting data-driven decision making to address the biodiversity loss. 

Whilst it’s true that rural landscapes and smaller economies are difficult testbeds for civic and service innovation- they’re also the site for some of the most impactful and transferable inventions. “The critical mass of demand for a service to make it commercially viable is just not there for rural landscapes and so it demands laser focus on driving efficiency to meet commercially viable standards and deliver on the services needed in rural communities”. 

One of CivTech’s startup success stories, The Routing Company, illustrated this in the transport sector. Working with the Highlands and Islands Transport Partnership (HITRANS), the start-up can track vehicle’s real-time location, capacity, and rider pick-ups and drop-offs even in the low or no-internet connectivity environment of the Scottish Highlands, and now the Company has scaled its tool to operations in Washington State, US and the UAE. 

Click here to learn more about the work of Scotland's CivTech programme.

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