The number of fast-growing ambitious businesses with leaders hungry for success is increasing across the North East – new insights from the ScaleUp Institute reveal.
There are now 820 companies in the region that meet the definition of scaleup because they have increased turnover or employment by more than 20% annually. North East scaleups are employing a total of 74,000 staff and their turnover is worth £9.5 billion. This is according to new research by the ScaleUp Institute based on the latest 2017 ONS data.
In the area, the top five scaleups by employment growth are Fairstone Group, Barrier Group, Eden Farm, Connect Health and DW Support Services, while the top five for turnover growth are Barrier Group, The Trout Hotel, Partner Construction, Eden Farm and Crabtree.
Across the UK there are over 36,000 scaleups, an increase of 3.7% from 2016.
ScaleUp Institute Chief Executive Irene Graham said: “Scaleups are the engine drivers of local economies; they are twice as innovative as large firms, employ twice as many apprentices, are twice as likely to be operating in international markets, and, significantly, they create high quality jobs.
“Their aspirations remain high. According to our recent ScaleUp survey eight out of ten expect to scale again in 2019, generating £1.5 billion more in turnover and creating an extra 7,000 jobs.”
While they are ambitious about their growth, scaleups continue to face major challenges. In the North East they particularly highlight access to UK markets, access to talent and leadership development as key issues. They also want easier access to support from peer-to-peer networks, local professional services and public sector funding for innovation.
The ScaleUp Institute notes that the North East offers a number of services for scaleups. “This is encouraging and we will continue to monitor their impact,” said Irene Graham.
Colin Bell, the North East LEP’s Business Growth Director, said: “These results are a great reflection of dynamism and strength of the North East business community. Despite continued uncertainty around Brexit, our entrepreneurs are continuing to scale and drive the North East economy forward.
“Scaleups are critical drivers of economic growth, representing less than 1% of the economy, but generating one third of new economic and jobs growth. That’s why the North East Local Enterprise Partnership set an ambitious target in 2017 to grow the density of scaleups in the North East by 50% by 2024. We now have 17% more scaleups in the region than we did in 2017, which represents strong progress towards our goal – there is lots to feel positive about and the North East business community should look to the future with confidence.
“We have been working hard to ensure our scaleup and scaleup potential businesses have the support they need from within our ecosystem. Support has included the launch of the flagship Scaleup North East service, Supply Chain North East, that introduces businesses to new markets, the £120 million North East Fund, Growth through Mentoring, that introduces business owners to mentors who have scaled their own business and worked with partners such as the Entrepreneurs Forum to create the peer driven Scaleup Leaders Academy.”