By Willie Watt
HELPING businesses scale up is fundamentally important to Scotland’s overall economic performance and success.
Multiple studies have reached that same conclusion, including an Oxford Economics study commissioned by the Hunter Foundation, with the Scottish Government’s own 10-year economic strategy also recognising the vital role they play.
The numbers tell us the same story. Across the UK scale-ups contribute £1.1 trillion of turnover – that’s 50 per cent of total SME turnover delivered by a staggering one per cent of the SME population.
However, Scotland’s contribution to that one per cent could be significantly better as we sit in the bottom quartile of UK regions/nations per head of population for scale-ups.
Scale-up is a fundamental component of the Scottish National Investment Bank’s missions, with impact investing at the centre of what the bank is all about. Its role is to provide patient long-term capital to businesses and projects to support a fairer more sustainable economy.
With Scotland having a well-supported start-up ecosystem, the bank’s focus needs to be elsewhere, investing and helping businesses that have already demonstrated commercial progress and are looking to scale, become more productive and go to the next level.
Last month the Scottish National Investment Bank announced its 18th investment since launch in November 2020, committing £10 million of backing for wireless communications experts pureLifi.
The Edinburgh-based firm is a true global leader in its field, using light to transmit data rather than conventional radio waves. By harnessing the light spectrum LiFi is able to provide more reliable wireless communications with unparalleled security, a technology with the potential to be adopted in every country around the world.
The bank’s financial support will allow pureLifi to scale up and take a technology launched in Scotland to the global market. The backing also represents investment in highly-skilled jobs and the potential creation of a Lifi centre of excellence in Edinburgh.
We need more buoyant high-growth businesses like pureLifi; they can drive the engine of prosperity and are critical to boosting Scotland’s productivity.
While the bank has the ability to address the financing gap, the value of working alongside and learning from other entrepreneurs shouldn’t be underestimated. It could make the difference between an under-achieving business or a business which becomes a world beater.
Recognising that, and a gap in strategic support for the development of high growth businesses as they scale up, the bank is launching Scaleup Scotland 2.0 in partnership with the Hunter Foundation, which will bring detailed scale-up knowledge.
The support programme has been specifically designed to provide tailored mentorship to Scotland’s high growth potential businesses, companies with the ambition to achieve over £100million in turnover.
It will provide future business leaders with insight and expert advice to support their growth ambitions, enabling CEOs to take a longer-term approach to value creation and help Scotland to build more home-grown businesses.
The Bank is committed to investing in innovation and industries of the future with the aim of supporting a more resilient and productive economy.
Scaleup Scotland 2.0 is a vital boost to help us achieve a fairer more sustainable economy.
Willie Watt is Chairman of the Scottish National Investment Bank
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