BGF & ScaleUp Institute launch thrive plan for UK’s scaleups
New report: What happens next matters
BGF and the ScaleUp Institute have released a seven-point plan based on key outcomes from the inaugural Scaleup Week: The Business Plan event which took place in May.
The report analyses some of the key trends that will affect growing businesses in the next 10 years and that were a topic of discussion during the week. It outlines a series of proposals to ensure scaleups are well-prepared to overcome challenges and benefit from the opportunities that are ahead.
Scaleup Week was led by BGF with the ScaleUp Institute and active engagement from Government, including the Secretary of State for Business, Energy, Industrial Strategy.
The week-long series of virtual events saw leaders of industry, investors, banks, academics and policymakers come together to address critical challenges as the UK recovers economically from the pandemic. The factors debated included: Levelling up, Planet and climate, Technological change, Global Britain, Unlocking ingenuity and Strength in diversity.
Stephen Welton, Executive Chairman at BGF, comments: “Today’s scaleup businesses are entering a rapidly changing world. Over the next ten years, a range of factors will disrupt, reshape and reorganise the operating environment for UK businesses. Everything will change. As such, scaleups need clear and decisive guidance to not just survive but thrive. Key to this will be to ensure there is a fully funded plan to drive investment nationwide.”
The seven proposals for supporting the growth of scale-up businesses include:
Increase private investment in scaleup companies by removing barriers preventing institutional investors, such as defined contribution pension funds, from investing in growth equity and venture capital investments. Alongside this, raise awareness of the benefits of equity capital among scaleup businesses and increase the knowledge and connectivity between institutional investors and scaling firms.
Bolster the ecosystem for scaleups across the UK by increasing investment resources in every region, not only in London. Continue to build a scaleup ecosystem of professional services across the UK while investing in infrastructure and digital connectivity.
Unlock the power of scaleups to accelerate innovation to achieve net zero, providing financial support that is truly long term. Ensure vehicles such as the Future Fund: Breakthrough initiative can provide patient capital at scale, including for businesses that are meeting national priorities such as the climate challenge.
Prioritise education and skills. Add flexibility to apprenticeship schemes and make programmes such as The National Skills Guarantee and Kickstart as accessible to scaleups as possible. Ensure computing and entrepreneurship are taught in schools.
Embrace foreign investment opportunities, establish trade corridors around the world and engage with sovereign wealth funds. Progress at pace the scaleup visa initiative, making sure visas are available for talented workers, take a lead on sharing knowledge globally and remove barriers to the export of data, services and intangible goods.
Increase R&D spending, as a percentage of GDP, initially to match the OECD average of 2.4% – and then go beyond that. Provide support for Innovate UK as a bridge between universities and scaling companies, alongside commercial roll outs, supported by the private sector, including BGF and the British Business Bank. Ensure the Advanced Research Innovation Agency (ARIA) is launched quickly and becomes a powerful addition to the ecosystem.
Review hiring policies with the aim of eliminating bias and provide support and opportunities for underrepresented groups. Support internship programmes such as 10,000 Black Interns and champion measures to increase the number of women in investment and greater diversity in management teams.
Stephen Welton, Executive Chairman at BGF, added: “These proposals are aimed at a range of stakeholders, from government ministers to private sector organisations and to business leaders themselves. We believe that as progress is made in the directions we have signposted, then scaleup businesses will do the rest. Given that these businesses – and especially the growth economy companies that BGF exists specifically to support – are a tremendous source of growth and innovation, the help they receive will repay itself several times over in terms of impact on the broader economy.”
Irene Graham, CEO at ScaleUp Institute, comments: “There are 33,445 scaleups in the UK, turning over £1.1 trillion and employing 3.2 million people and we have a healthy pipeline of such firms. They are crucial contributors to GDP; they are active in every sector of the economy and are major employers across every region. However, we know that these businesses need help to continue to scale, particularly in the post-pandemic world. We hope these findings galvanise further action to foster scaleups and ensure they have the conditions needed to thrive.”
The full report, entitled ‘What happens next matters: Seven proposals for supporting the growth of scaleup businesses’ can be read here.
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