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Opinion: Staying power

Start-up visas allow students to remain in the UK after graduating to try to start a business. The University of Manchester’s Dr Robert A Phillips explains how they’re a good way of attracting international students to your university following Covid-19

With student recruitment under severe pressure due to Covid-19, could the post-study Start-up visa entice more enterprising students from overseas to study in the UK?

With shows such as The Apprentice and Dragons’ Den proving so popular, and many universities having high-profile alumni entrepreneurs, entrepreneurship is now considered a credible career option for many students. For foreign students, applying for a Start-up visa post graduation via your university (often by submitting a business plan or taking part in a pitching competition) could be a great option for ambitious students who are considering starting their own business in a country generally friendly to entrepreneurial mindsets.

The Start-up visa is one of a number of post-study options that graduating foreign students have if they want to remain in the UK, and with data from the Global Entrepreneurship Monitor suggesting that immigrants are significantly more likely to start a business than our general population, it’s a good opportunity for graduates to realise their ambition whilst contributing to the UK economy. With the Start-up visa initially lasting for two years – but transferable if successful to a more permanent visa – it allows the graduate time to show what they can do before the UK commits to allowing a permanent stay.

The scheme originally started life as the Tier 1 Graduate Entrepreneurship Visa in 2008, but the Migration Advisory Committee review of 2015 found that whilst it worked well, the non-graduate version of the visa had many low-quality and low-innovation businesses and was susceptible to fraud. Despite the 1,600 companies and £1.5bn turnover between the two schemes it was a felt a focus on a smaller number of high-growth businesses would be beneficial – and all decision-making should be shifted away from the Home Office to others better able to judge innovative ideas, such as universities, venture capitalists and business professionals.

Universities are in a good position to market the Start-up visa as an additional reason for foreign students to enrol at UK universities

The new rules introduced last spring have opened up the re-named Start-up visas to all potential foreign entrepreneurs (not just graduates) – so students are now competing in a wider pool of potential applicants – however, many universities only accept applications from their own graduates. The need to find £50k of investment has been waived and there is no cap on endorsements (previously limited to 20 per institution) provided they meet the criteria. Also, visas can now be sponsored by a number of organisations – not just universities – such as accelerators and incubators who might be able to provide specialist support to innovative ideas. These include accelerators run by NatWest and Royal Bank of Scotland, and some with specialist expertise such as Bethnal Green Ventures (ideas for improving society) and Deep Science Ventures (science and engineering).

The government’s requirement for startups to be “innovative, viable and scalable” has shifted the focus from fairly low-risk, low-reward food and app ideas towards more ambitious higher-risk, higher-growth business ideas. As part of the judging panel at the University of Manchester I’ve noticed a higher percentage of tech businesses are being put forward, although the government suggests overall there are fewer applicants to the Start-up visa than the previous Tier 1 graduate and non-graduate routes combined. It is perceived by many that the new criteria are stricter, however, there is some scope for institutions to interpret what makes a good application for themselves, with follow-up milestones generally being light touch – not simply the acquisition of funding as previously required – but now profit, turnover, job creation and social impact metrics can all be taken into account.

The impact of Brexit may encourage the government to look further at these rules – and universities are in a good position to market the Start-up visa as an additional reason for foreign students to enrol at UK universities.


Dr Robert A Phillips is senior lecturer in entrepreneurship at the Alliance Manchester Business School, University of Manchester where he sits on the panel for judging visa applications.


Success Stories

Startups that originated at the University of Manchester

1. Joy and Joe who make innovative babywear (www.JoyandJoebaby.com)

2. Urban Chain which uses blockchain to lower customers’ energy bills (www.urbanchain.co.uk)

3. Specscart whose innovative business model supplies branded eyewear at low prices (www.specscart.co.uk)

4. The Mindful Store which sells eco-friendly and ethical brands (www.mindfulstore.co.uk)


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