Scaleup Identification – Data

Data is the lifeblood of the modern world. Harnessing public and private sector data is key as we seek to refine and target initiatives towards scaleup businesses. Since our foundation, the ScaleUp Institute has been a resolute champion for better access to data to allow for more robust policy choices to be made. It is encouraging that the power of data to better understand and boost economic growth is now being recognised. 

Our economies, like our politics, are local… Like our bodies, understanding our economic health means taking readings at many resolutions … it calls for new data, at higher frequency and higher resolution, and new ways of stitching it together.
Andy Haldane – Chief Economist, Bank of England, May 2019¹

Accessing up to date data remains the single most important item on the ScaleUp Institute’s agenda. This means being able to enquire on a company’s scaleup status against the most recent data held within Government, namely at HMRC.

DATA DRIVEN POLICY IN ACTION

In 2019, we have continued the data pilots that we have been undertaking with HMRC and BEIS, as well as the collaborative cross-government approach to reviewing options for disseminating this data more readily. Evidence shows the timeliness of interventions is key if we are to optimise our scaling businesses’ greatest potential. Research shows that, when a business is scaling rapidly, speedy engagement early on in its journey is vital as the window of opportunity is limited if the scaling firm is to realise its fullest potential and scale again. As well as our own research in this area, this is further corroborated by World Bank research on an international level, published earlier this year².

Data remains the fundamental ingredient to make sure all communities can engage on a timely basis with scaling companies and make sure they get the right support at the right time to foster their continued growth in the UK.

In 2018 we were delighted that our pilots led to greater engagement with scaleups. Notably in Thames Valley Berkshire where there was delivery of grants and services about which a local business had previously been unaware. These pilots prove the efficacy of using HMRC data and linking scaleup businesses to tailored scaleup solutions.

In 2019, building upon these learnings – including the need to have bespoke messaging – the ScaleUp Institute was able to undertake further trials with HMRC and BEIS in Leeds, Nottingham and Derbyshire, and the West of England. These reached several thousand scaling businesses with several hundred responding to uptake in a scaleup service (exceeding normal take-up rates). Working with Government we plan to publish learnings from this work in the early part of next year, and we will continue to work with Government to ensure that this contact programme is refined further with the third wave of these trials expected to commence in 2020.

The Scaleup Institute continues to believe that if a company’s scaleup status is made available to enquire upon via a ‘verification service’ it will encourage engagement from the public and private sector. It will also enable resources to be targeted much more efficiently and effectively towards specific scaleup firms to foster their continued growth, removing hurdles and allowing access to the necessary talent, leadership, finance and infrastructure support. A more granular understanding of UK businesses, and effective firm level interventions, will also benefit monitoring and analysis of existing policy interventions and work on future initiatives. (This is borne out by the Insight Technologies case study). If legislation is required to be more proactive with Government datasets, then we believe that Government should actively consider the appropriate framework for this legislation and work to move this forward at pace.

It is only through greater understanding, segmenting and targeting of our scaling businesses and available services towards them that we will be able to shift the dial on UK-wide growth, exports, procurement, innovation and productivity. The data also enables prioritisation of those areas of the country where the scaleup gap is increasing and makes the ecosystem more efficient in their assessments and solutions.

We are similarly encouraged that the Department for International Trade (DIT) recognised the importance of segmentation to driving export growth in its Export Strategy. However, with work still continuing to turn this into practical policy outcomes, it is important to ensure this data and segmentation is fully embedded within the design of the programme and its delivery, including the use of the tested scaleup focused messages utilised as part of our trials with HMRC and BEIS noted above.

DATA COLLABORATION

As noted above, the ScaleUp Institute is very pleased to continue to play a part in the Cabinet Office DECA Working Group looking specifically at how data can be used to better identify scaleups, and also how data can impact upon UK productivity.

It will be important to ensure that the strong work already underway through this group is built upon in any future data strategy, looking to map gaps in capability across Government, and highlight where more work can and should be done to boost understanding and cooperation. This should also work to enable appropriate institutions to put data to use at a local level in a way that they can utilise it effectively, whether this is expanding gateways or data hubs through more targeted local programmes, interventions and services. This will better equip existing entities such as Combined Authorities, LEPs and Growth Hubs to find and help scaleup businesses in their areas, and support the key delivery bodies of Innovate UK, the British Business Bank and DIT in providing national and locally connected services for scaleup businesses.

While this work develops, the ScaleUp Institute will also continue to update its Scaleup Map and Scaleup Index, developed with Beauhurst and our Scaleup Public Procurement Index which we have developed with Tussell. We also encourage universities, banks, accounting firms, LEPs and schools to continue to put scaleups ‘on the map’ based upon indices, client, and local knowledge. This challenge has already been taken up, to excellent effect, in Cambridge, Thames Valley Berkshire, Ashford, and by Barclays and Sage; just a few examples, which can be emulated. In 2020, with local partners, we will be developing an Export Data lab to further analyse the important gaps in the access to markets agenda.

In Summary

The results we have seen from pilots with HMRC data show the importance of and benefits from segmenting the UK business population effectively. More timely data will allow for more tailored programmes and the ability for scaleups to develop deeper relationships within local ecosystems as they continue their growth journey.

With this in mind we continue to recommend that: