Scaleup 2018 Review... · 2018. 2. 2. · 26th January, 2018 . @scaleupinst. The ScaleUp Institute...

Scaleup 2018

Irene Graham, CEO, ScaleUp Institute The Scaleup North East Launch Newcastle 26th January, 2018

@scaleupinst

The ScaleUp Institute was borne out of the desire by the private sector to create an entity to champion the scaleup agenda and make the UK the best place in the world to not just start but scale a business.

We are doing very well on Start-ups...

#scaleup @scaleupinst scaleupinstitute.org.uk

But we are doing less well at growing them...


THERE IS A SCALE-UP GAP ▪ Many European economies, including UK

are as effective as US in creating new businesses

▪ Not enough of them grow – displacing older firms

▪ The UK has a lower share of large businesses than the US

▪ Large firms with more than 250 employees account for 0.5% of firms in the UK but 0.7% in the US

▪ This lack of ‘scale up’ means the economy as a whole loses on productivity and growth.

Nesta (2011). A Look at Business Growth and Contraction in

Europe

http://www.scaleupreport.com


http://www.scaleupreport.com

Very Few Start-ups Survive and Grow UK businesses that started in 1998 – 10 years later and

beyond

221,731 83,165

8,649

5,934

All businesses that started with at least 1 employee

Businesses that survived in 2008

Survivors with 10+ employees in 2008

Survivors that achieved at least 1 year of high growth

100%

37.5%

3.9%

2.7%

#scaleup @scaleupinst

scaleupinstitute.org.uk

SCALEUPS ARE PRODUCTIVE High levels of productivity are twice as common among scaleups. Scaleups

are highly productive, averaging £235,000 turnover per employee.

SCALEUPS CREATE JOBS Across all communities; having UK

and international employees

SCALEUPS ARE HIGH QUALITY Scaleups help create high-quality jobs

with more satisfied employees.

SCALEUPS ARE DIVERSE 47% of all scaleups have at least

one female director

SCALEUPS ARE INNOVATIVE AND INTERNATIONAL

Two-thirds of scaleups are involved in international trade. Scaleups are twice

as likely as their peers to be trading internationally. Scaleups are twice as likely as their peers to have

innovated in the past three years.

SCALEUPS ARE ACROSS ALL SECTORS

Scaleups span the economy: the majority of them operate in sectors

outside of technology

THEY ARE GOOD CORPORATE CITIZENS

74% of scaleups offer opportunities to young people through work

experience, internships or apprenticeships

THEY PLAN TO GROW Most scaleups expect to grow again

in the coming year. 77% expect to achieve 20%+ turnover growth.

52% expect to achieve 20%+ employee growth.

WHY SCALEUPS MATTER

#scaleup @scaleupinst


The National & local Picture

NUMBER OF SCALEUPS NATIONAL FIGURE :ONS DATA 2013-2015

12,180 IN 2015

14,190 IN 2014

12.495 IN 2013

25,530 IN 2015

19,610 IN 2014

20,195 IN 2013

6,270 IN 2015

6,310 IN 2014

5,705 IN 2013

31,440 IN 2015 27,490 IN 2014

26,985 IN 2013

BY EMPLOYEE GROWTH BY TURNOVER GROWTH BY EMPLOYMENT AND TURNOVER TOTAL NO. OF SCALEUPS


SCALEUP INDICATORS FROM A NATIONAL AND LOCAL PERSPECTIVE


NORTH EAST LEP EXEMPLAR


LOCATION LOCATION LOCATION

DRIVING ECONOMIC

DEVELOPMENT THROUGH SCALEUP

ECOSYSTEMS


What Scaling businesses most need in breaking down barriers

THE 2017 SCALEUP SURVEY AT A GLANCE


THE 2017 SCALEUP SURVEY AT A GLANCE 343 SCALEUP BUSINESSES GENERATING £6 BILLION IN TURNOVER. THEY ARE HIGHLY PRODUCTIVE AVERAGING £240,000 TURNOVER PER EMPLOYEE.

NORTH EAST LEP EXEMPLAR

Scaleup Leader Academy and Entrepreneurial Mentoring. Partnerships to turn scaleup potential into scaleup performance


Scaleup Talent

A combination of social skills and tech remain key for school and graduate recruits, although social skills ranks top when force ranked

The key future skill for staff is critical thinking – being able to analyse a situation and make a decision – followed by service orientation

TALENT AND SKILLS

Leadership

Recruiting people with experience of growing a business is key, as are non-exec directors and connection to a network of peers LEADERSHIP


LEADERSHIP


Access to Markets

The procurement process and the time it takes to win a contract are the key barriers to working more with government or large corporates

ACCESS TO MARKETS

CORPORATE COLLABORATION AND PROCUREMENT CHECKLIST

Europe and North America are key markets but there is clear appetite to move to more diverse markets such as India and Latin America

Having access to customers and overseas partners as well as staff with the skills to do the deals are key barriers to exporting (more)

ACCESS TO MARKETS

ACCESS TO MARKETS

Access to Finance

While three quarters of scaleups use external finance, 4 in 10 say they do not have the right amount of finance in place for their needs

A quarter are using equity finance now. The key barriers are the loss of control or a lack of suitability

FINANCE

Access to Infrastructure

Scaleups would like easier access to public sector funding for innovation and R&D, general business support and Growth Hubs

The value that scaleups see

in improving their access to

a strong local ecosystem,

including local sources of

knowledge and expertise,

to help them further their

growth journey is apparent

throughout responses.

INFRASTRUCTURE

LEADING PROGRAMMES BREAKING DOWN THE BARRIERS FOR SCALEUPS


Developments in Public & Corporate Policy

Industrial Strategy Consult 2017; Patient Capital Review & ScaleUp Taskforce


Five Foundations of the Industrial Strategy


2017 /2018 RECOMMENDATIONS: SUMMARY SNAPSHOT

● Unleash the data : “Scaleup status” to be officially recognised as a formal business

classification ● Funding for local communities to be tied to the

effective deployment of scaleup initiatives and their impact

● The Department of Education and LEPs to use their convening power to ensure that students at schools, colleges and universities come into contact with the top 50 scaleup business leaders within a local 20-mile radius

● Make a scaleup visa available to communities in which there are 100+ scaleups. MAC review needs to assess this further.

● All communities appoint a scaleup champion

and develop an account management structure for scaling businesses businesses

● Local stakeholders to signpost effective mentorship and matchmaking programmes. Virtuous circle national/local. The Small Business Charter & others should integrate an assessment of ‘scaleup engagement’’ to their analysis

● Public bodies to review and report on procurement procedures for scaleups & improve the manner in which they are promoted to scaleups (champions; contracts finder; sandbox)

● Large companies to report on the level of collaboration and procurement they source from scaleup and companies

● Central Government to align a significant portion of its export activities and resources towards scaleups and create bespoke trade missions for scaleups

● Government and industry to ensure progress is made in closing the finance gap

VISIBLE SCALEUP GROUPS- THE SCALEUP INDEX Based on Companies House data excluding charitable and third sector scaleups and listed companies, which will be subject to separate analysis. Data Analysed by Beauhurst.

NORTH EAST VISIBLE SCALEUP GROUPS BASED ON OECD DEFINITION - THE SCALEUP INDEX

RECOMMENDATIONS: PROGRESS

2016 RECOMMENDATIONS: PROGRESS

MAKING THE UK THE BEST PLACE TO SCALE A BUSINESS

Professor Daniel Isenberg

scaleupinstitute.org.uk #scaleup @scaleupinst

THANK YOU AND GET IN TOUCH [email protected] @scaleupinst

http://www.scaleupinstitute.org.uk/

mailto:[email protected]

http://www.scaleupinstitute.org.uk/

Scaleup 2018 Review... · 2018. 2. 2. · 26th January, 2018 . @scaleupinst. The ScaleUp Institute...

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