Expert commentary on Scottish firms

Innovation nation

Tim Hames, Director General, British Private Equity & Venture Capital Association

A technology revolution is changing the way we live, work and communicate. The constant need to innovate to remain competitive is a fundamental challenge for the UK on the global stage. The nation already has a proud track record of enterprise and entrepreneurialism – what we need to do now is ensure that this not only continues, but accelerates.

In an ever-shrinking world, the need to promote and finance innovative businesses is vital. Transforming today’s ideas into tomorrow’s global companies requires a skilled workforce, a robust infrastructure and, crucially, a dynamic investment community. The UK’s unique combination of these factors make it the leading European destination for entrepreneurs to launch and grow start-ups – foreign entrepreneurs set up one in seven new UK businesses.

Last year, the BVCA launched a new campaign designed to celebrate what makes Britain The Innovation Nation. We have a rich eco-system, which connects entrepreneurs and investors through a chain built on world-renowned scientific and academic institutions and a deep support infrastructure. Our legal, regulatory and tax environments are among the most competitive in the world and companies benefit from a historically open business approach.

“The sheer diversity of British excellence is truly staggering”

As a result of such encouraging factors, 2014 figures show that the UK had the fastest growth rate in Europe, at 2.9%, and is set to overtake Germany as Europe’s largest economy by 2030. But regardless of such positive feats, Britain is not traditionally very good at shouting about what makes us great. Initiatives like The Innovation Nation and this book are both robust efforts to change this.

We have a lot to shout about. The UK is the advocative gateway to a market of 500 million European consumers and an organic bridge to the US. It is, quite simply, the natural place to start, grow and accelerate a business.

  • £2.5bn – The amount invested by venture capital funds in the UK in 2014

In 2014-15, a record 580,000 new businesses were created. Venture capital funds invested £2.5bn in 2014 in the UK – a greater amount than any other European nation. More than 780 companies successfully raised venture capital here – again, more than any other country in Europe. London is consistently ranked as being the best European city for start-ups, and the UK as a whole can lay claim to 17 ‘unicorn’ companies (those valued at US$1bn plus). That’s as many as France, Germany, the Netherlands and Sweden combined.

The sheer diversity of British excellence is truly staggering. As the BVCA’s report highlights, Britain has outstanding companies in a dazzling array of sectors throughout the country. Driven by proximity to universities or regions with a related industrial heritage, these communities help accelerate growth by providing a personalised network of businesses, mentors, angel investors, venture capitalists and talent.

From fintech and creative in London, F1 and automotive in the Midlands, oil and gas in Aberdeen, and business software in Newcastle, the UK has an innovation landscape that is the envy of the world. Ground-breaking technologies and services keep Britain at the forefront of the technological revolution.

These companies illustrate how crucial the right location and support network is to a company’s success. The combination of ideas, business expertise and investment available here is a significant advantage to enterprise here. These components prove that the UK is truly The Innovation Nation.