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The contribution of scaleup businesses to the health and dynamism of the UK economy is being increasingly realised. Scaleups matter because they are across sectors, in every area of the country and are generators of exports, jobs and growth in our local communities. They are a prime source of today’s jobs and tomorrow’s.

This report brings together new analysis of data from the independent SME Finance Monitor to provide further demographic insight into this vital segment of UK business. The snapshot also compares them with the wider national population of small and medium-sized enterprises.

This new analysis reinforces the fact that scaleups come from all business sectors and geographic regions. They are more likely to be innovative and international than their counterparts, with greater ambition and plans for further growth.

While the overall economic climate is not a primary concern for them, this analysis reinforces the fact that scaleups view the greatest barrier to growth as the recruitment and retention of staff; followed closely by management/leadership skills, availability of relevant advice, access to prompt payment and options of finance.

The analysis allows us to better understand the makeup of these businesses and their overall attitude towards finance and growth. A driver of scaleup status is their innovation in service, markets and products; scaleups often have an owner/ manager under 50. Scaleups also tend to be more profitable.

Although scaleups are more willing to use external finance to help them grow, four out of ten choose not to access it. Scaleups require confidence and support to help them in their growth journey. There is a clear need to ensure that business leaders can access finance and understand their available options. It is important to increase the provision of education on growth finance so that scaleup leaders understand – and are aware of – all the available options so they can structure their companies appropriately.

There are some important and constructive points that can be drawn by the financial community from these latest findings: it shows that further thought should be given to the nature of the support that the financial community provides to scaleup businesses. Scaleups are not just looking for cash – they want smart money which brings knowledge and support along with it.

We are fortunate to have many capable and ambitious business leaders who are innovating to provide customers with better services than before. Growing pains in companies that are scaling are inevitable and we all have a role to play in breaking down the barriers that exist to allow their growth to flourish in every city and area of the country. This report gives key insights which we can act on. We hope it will be used by national and local financiers, policymakers, educators and industry in their work. As we consider the next steps of a modern industrial strategy and the Patient Capital Review, it is critical that we establish the right local and national frameworks to allow scaling businesses to flourish.

The ScaleUp Institute thanks its partners and contributors to this document: BDRC Continental, who manage the SME Finance Monitor; the British Business Bank; Beauhurst; London Stock Exchange; and Better Business Finance, as set up by the UK banking industry.

Download the full report here.

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