Explore the ScaleUp Annual Review 2020

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North East

Trusted account managers working with scaleups on a bespoke package of support to increase density of scaleup companies in the region

DATA:

650 scaling businesses supported

£5.86m investment raised

1,350 jobs created since 2018

£16.2m new contracts won

Participating sectors

Creative, digital, film, games & media Engineering / Advanced Engineering Food & drink Life Sciences & Biotech Manufacturing / Advanced Manufacturing Professional services

BACKGROUND

The North East has fewer scaling companies than other regions but the LEP has recognised scaleups are vital to growing the regional economy.  Scaleup NE is a programme of specialist support designed for businesses selected on the basis of their size and previous growth history.  Its purpose is to get behind the companies with drive, ambition and the potential or track record for significant and fast growth in the region, providing the support and guidance that they require to 

Scaleup North East is very much led by the needs of each business; it matches each participating company with a “Scale-Up Partner” who has vast experience of scaling their own company at a senior level.  The Scaleup Partner’s role is to uncover the most challenging issues faced by each company and provide bespoke support to help overcome them. 

Overall, the programme looks to develop a scaleup community and ecosystem that meets the needs of fast growing companies in the region, a supportive network of assistance that enables companies to be the best they can be.

ONS data for 2018 shows that there are 730 scaleups in the North East LEP: 320 are classified as scaleups due to rapid growth in their employees, 580 are classified as scaleups due to rapid growth in their turnover and 170 are scaleups that are increasing both employment and turnover simultaneously.

The ONS data reflects that across the four-year period from 2015 to 2018 the density of scaleups has increased by 0.35 per 100,000 of population per year, which is below the median of +0.8 per 100,000 of population.

SCALEUP PROGRAMMES

Scaleup Partners work with each company to uncover the most challenging issues it faces based on the five key barriers identified by the ScaleUp Institute and then provide bespoke support to help overcome them. Each company defines its own objectives in partnership with the Scaleup Partner and they help the company to take the actions required to grow the business. 

Alongside the 1:1 support offered through the programme, companies can access other forms of peer to peer support from associate partners and approved provision.  As account managers, the Scaleup Partners signpost, introduce and steer participating companies to high level, relevant and valuable support and advice provided through our established wider network of providers which include local colleges and University of Newcastle Business School, the Scale-up Leader’s Academy run by the Entrepreneurs’ Forum, Vistage, the British Business Bank and Barclays Eagles Labs – many of which are endorsed by the ScaleUp Institute.

The programme is also underpinned by on-line events (normally face to face), motivational and inspiring speakers and socials to enable companies to learn from their peers. 

IMPACT AND RESULTS

Since 2018 650 businesses with the potential to scale or already scaling have been supported by their Business Partners, creating an estimated 1,350 jobs by the end of 2020.  The programme has distributed £1.2m of grant resources that will leverage £1.8m of private sector matched funding; supported winning new contracts worth of £16.2m to date and helped access £5.86m of private equity, bank and angel investment.

LESSONS LEARNED

Attracting and engaging successfully scaling companies to the programme has been a challenge. Those that have the potential to scale or have scaled and stalled are keen to engage as they need support. Those that are already scaling are less likely to engage as they feel in less need of support and therefore the LEP has rethought the Scaleup NE benefits and offer for these companies.   Extra time has had to be dedicated to companies with the biggest potential.

FUTURE PLANS

Scaleup NE2 launched in Autumn 2020 with some changes based on lessons learnt to date.

Our adviser played an instrumental role in getting our foot through the doors of some of the biggest UK supermarkets and healthy food stores, providing invaluable guidance and advice.
Andy Dixon, Oatein founder

LONGITUDINAL ANALYSIS

According to ScaleUp Institute analysis of data received directly from ONS for years 2015-2018, the following picture emerges on the local environment.

Local Authorities located within the North East LEP have a low density of scaleups, and the trend between 2015 and 2018 reveals that almost all of the local authorities showed an increase in the density of scaleup businesses, and half showed an above median increase in scaleup density.

Scaleups by Density: Needs Improvement

The vertical axis of this matrix shows where local authorities located in this LEP stand compared to the rest of the UK: 5 of the 7 local authorities have a below median density of scaleups measured by employment growth and 5 of the 7 local authorities have a below median density of scaleups measured by turnover growth.

Scaleup Trends Over Time: Moderate

The horizontal axis of this matrix shows whether the density of scaleups has increased or decreased over time relative to the rest of the UK: 4 of the 7 local authorities are above the median in terms of improving the density of scaleups by employment in their community and 4 of the 7 local authorities are below the median for scaleups by turnover.

The ScaleUp Institute will continue to monitor this closely in the coming years to track whether local initiatives move the dial in the right direction for increasing the density of scaleups.

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