These are the investors most likely to back your scale-up business
A new report has revealed that most fast-growing firms are not tech-focussed, with the majority operating in property, distribution, and manufacturing
New data from Beauhurst has revealed the diversity of the UK’s scale-ups – such as the breadth of sectors they operate in, who they receive investment from, and their presence across the nation.
The Scale-Up Index, complied by Beauhurst, the ScaleUp Institute and Smith & Williamson, has revealed that there are currently 3,856 unique scale-up businesses currently operating in the UK – if you exclude LLPs, charities, trusts, acquired businesses, those with a foreign HQ, and subsidiaries.
In the report a ‘scale-up’ is defined as any enterprise with an average annualised growth greater than 20% per annum, over a three-year period, with at least 10 employees.
Described as “vital to the strength of the UK’s economy”, scale-ups are certainly catching the attention of investors – who pumped £838m into 48 high-growth UK firms last year.
By no means the best of recent years, 2014 saw a record £1,383m invested into 87 UK scale-ups – with a smaller £1,060m injected into 72 businesses in 2015.
What might be considered surprising news to some, that highest number of high growth firms are not tech-focussed, but work in the property and land development sector – with 546 of such businesses recorded.
Firms in the distribution industry come second (283), followed by manufacturing and engineering (277), builders (255) and food and drink processors (219).
Less surprisingly, London is the region home to the most number of visible scale-ups with 790 of the UK’s fastest growing firms calling the capital city home.
This is followed by Scotland (229), South East (219), Greater Manchester (162) and Leeds City Region (144).
With the average number of scale-ups for a LEP (local enterprise partnership) coming in at 81, Coast to Capital (111), Enterprise M3 (98), North Eastern (95), Hertfordshire (94), Derby, Derbyshire, Nottingham & Nottinghamshire (90) and Greater Cambridge & Greater Peterborough (80) are all above the norm for breeding high-growth businesses.
Who are the top investors in UK scale-ups?
According to the report, between 01/11/2011 and 30/09/2017, BGF was the biggest back of UK scale-ups – injecting finance into 55 scale-ups.
This was followed by Index Ventures (21), Eden Ventures (14), Notion Capital (13), Llyods Development Capital (12) and Woodford Investment Management (12).