Dodgy Statistics and Seasonal Cheer (hic!)

It seems to be the season for dodgy statistics as well as good cheer – though perhaps overdoing the good cheer has an impact on the statistics (hic!).

Firstly the UK Governmemt’s £1Bn innovation fund is accused of shaky maths by Richard Tyler in the Telegraph who also questions the wisdom of the Government setting up its own fund rather than giving the private sector tax incentives to do it.

The weirdest statistic comes from the normally excellent UK Trade and Investment who claim that the town of Lowestoft is the ‘Enterprise Capital of Britain’ on the basis of having set up 50,000 new businesses. Given that the town’s population is only 60,000, it’s ether even more impressive or total and utter rubbish (unless of course that the numbers are calculated for businesses set up in ‘Greater Lowestoft’ over the last three millennia).

More serious is dodgy numbers in the business plan I was reviewing earlier for a nanomaterials company. All of the market numbers came from a rather infamous report which predicted nanotech markets in the trillions of dollars with phenomenal growth rates across the board, which led the company to expect fantastic revenues in half a dozen diverse and unrelated market segments. I usually suggest that any business plan which relies entirely on third party market research, and in this case the sunniest and most optimistic research imaginable, goes straight in the bin.

Most of the market research we perform at Cientifica helps validate data acquired elsewhere by our clients, and helps to build an overall picture of the oppotunities and inform discussions about strategy. Clients are sometimes disappointed that our numbers are not as big as other forms would predict, but in a long tern business such as nanotechnology it’s better to spend more time worrying about the accuracy of the numbers than their magnitude.