New report from BGF and Barclays finds UK start-up activity rises in first half of 2013
With the UK economy seemingly on the way to a sustained recovery, business confidence and entrepreneurialism also seem to be on the rise according to a new joint report from BGF and Barclays.
The Entrepreneurs Index, which tracks the full entrepreneurial lifecycle using data to measure start-ups, growth and share sales, has found that the number of start-ups and high-growth companies has climbed in the past year in the UK. This is the first report of what will be an ongoing series.
Using data from Experian, Companies House, Office for National Statistics, StartUp Britain and YouGov, the report gives a telling insight into the state of the UK’s entrepreneurial activity and reveals that there has been a 3.4% rise in the number of active companies in the first six months of this year, taking the total number of companies in the UK from 2.73 million at the end of 2012 to 2.82 million at the end of the first half of this year.
The proportion of high-growth companies in the UK has also shown an impressive increase, from 17.4% in 2011 to 20.5% in 2012. This means that one in five of these companies can now be defined as high-growth. Read the full report to see how we have defined ‘high growth’ companies.
The report also gives a fascinating breakdown of the activity across the regions of the UK and provides a revealing look at which regions make a vital contribution to its economic growth. If you are interested in which two Scottish cities outside the South East are included in the top ten cities with highest start-up rates in 2011, then it is worth reading the full report. Similarly the report reveals which part of the UK attracts the highest value of angel investment, second only to London and the South East.
At BGF, we recognise that these types of businesses are an integral part of the economic recovery and through a deeper understanding the entrepreneurial talent in the UK, we can better provide the right finance and networks to help their continued growth and development.
The report, hosted on the Barclays Wealth website, also features interviews with BGF CEO Stephen Welton and Richard Phelps, Managing Director, Barclays Wealth and Investment Management.
The full BGF and Barclays Entrepreneurs Index can be read here.
In November 2013, BGF invested £2.5m in Sub10 Systems (Sub10), a specialist designer, developer and vendor of class-leading millimeter wave (“MMW”) wireless solutions for mobile telecoms.
Sub10’s products are high speed wireless devices for data transfer across mobile networks where historically data transfer has been slow and unreliable. The company’s customers are primarily telecommunications companies and large network operators. Due to the growth in mobile data traffic, many operators are using wireless to save on radio spectrum usage and thereby increase efficiency. This can be achieved by using products such as Sub10’s wireless links where plenty of data spectrum is available for relatively short, high speed, point-to-point data connections. This is ideal for densely packed communications networks such as urban areas and Sub10’s products will help to improve the performance of mobile networks.
Sub10’s aim is to develop the smallest, best in class MMW wireless solutions which are cost effective and installer friendly. The company exports 90% of its products and currently the majority of its sales are to operators in Eastern Europe, Russia and Turkey with the remainder to the UK and Ireland.
Merger with Fastback Networks
In March 2015, Sub10 Systems agreed a merger with US venture capital backed company Fastback Networks.
Fastback, which is based in San Jose, California, delivers innovative mobile infrastructure technology, enabling network operators to deliver enhanced wireless solutions to its customers.
The merger created a group that is able to provide high performance backhaul solutions essential to the deployment of LTE, LTE-A, VoLTE, 4G and 5G mobile networks. The new entity converges Sub10 and Fastback’s powerful and proven technology platforms and intellectual property to enable the industry’s first hybrid – sub 6GHz and mmWave – Any Line of Sight™ backhaul solutions.
The Sub10 Systems operation in Devon became the new European headquarters for Fastback. The combined group is taking immediate advantage of Fastback’s North American sales and marketing presence and strengths, and vice versa for Sub10’s European presence and strengths.
BGF remained as a minority investor in the enlarged entity.
SHS extends breadth of industrial services with £2m acquisition
– Acquisition follows £5.4m investment of growth capital by BGF in September 2012 –
BGF portfolio company SHS Integrated Services, a specialist provider of high specification industrial scaffolding and associated services, has acquired Dixon Pentland Scaffolding Company Limited, a leading provider of scaffolding services to the energy and heavy industrial sectors. The opportunity was introduced to SHS by Grant Thornton Corporate Finance in Cardiff, who also advised on the transaction. The value of the transaction was approximately £2m.
The acquisition will provide Barry-based SHS with a national platform for expansion into a highly specialised and regulated market.
Based in Doncaster, Dixon Pentland specialises in work in the critical services sector, for example providing scaffolding services to the power line and transmission industry. The company’s specialist work for customers such as National Grid is complementary to SHS’s own activities on petrochemical and utilities sites.
With an annual turnover of £5m, key customers of Dixon Pentland include AMEC, Babcock and Balfour Beatty and the company employs 65 people.
Founded in 1998 by Paul Smith, SHS erects and dismantles large scale, technically demanding scaffolding structures for clients in the petrochemical, oil and power generation sectors. It also provides complementary insulation services. SHS’s services are often required by site owners, operators and contractors for essential maintenance and refurbishment work of industrial plants. Offering the highest safety and operational standards, SHS has secured long term contracts with multinationals such as Dow Corning, Murco and Alstom.
SHS financed the acquisition following investment totalling £5.4 million made in September 2012 by BGF.
Dixon Pentland represents the first acquisition that SHS has made using BGF capital.
Finance director, Gavin Payne, who led the deal on behalf of SHS, commented:
“This is an important step for SHS. Dixon Pentland’s reputation and customer base is a great fit with SHS, opening up new markets and enabling us to provide an even more complete service to our customers. We shall be continuing to work with Grant Thornton and BGF to identify potential further acquisitions to complement and extend our offering in what is a highly-specialised market.”
Paul Oldham, BGF’s regional director for South Wales and the South West of England, commented:
“SHS was the first company in Wales that BGF has backed and our investment was made in order to strengthen the company’s core capabilities, develop a broader range of services and expand into new sectors and geographies. Dixon Pentland is a highly complementary acquisition given its reputation in the industry as a well-established, high quality operator and will add considerably to the range of services that SHS is able to offer its clients.”
Regional Director – South
Paul joined BGF in May 2011 and heads up our South West and South Wales region, covering the South West of England, Berkshire, Hampshire, Oxfordshire and South Wales from offices in Bristol and Reading. As well as working on new investment opportunities in the region, he currently sits on the board of four BGF investee companies and is a member of the BGF national Investment and Executive Committees.
Prior to BGF, Paul worked as a private equity investor for 16 years with 3i and LDC and also led Grant Thornton’s South West Corporate Finance advisory team as Partner for six years. He qualified as a Chartered Accountant with KPMG in Manchester and holds a First Class Degree in Economics and Accounting from The University of Sheffield.
“I joined BGF on the day we launched – the opportunity to create a new and unique investment business focused on helping SMEs to grow was both exciting and challenging. It is great to see that our supportive, long-term approach to funding and supporting ambitious management teams is in demand. We are achieving two of our key objectives – helping exciting private companies to grow, and increasing the size of the equity growth capital market in the UK. We will continue to invest in our regional team to enable us to work with many more ambitious companies.”
Alex joined BGF from KPMG Corporate Finance in February 2012 and is responsible for sourcing and executing investments throughout the South West and South Wales.
Since joining, he has been involved in over 10 completed investments and currently sits on the board of a number of these in support of their growth aspirations.
Alex graduated from the University of Warwick with a degree in Mathematics in 2004 and qualified as a Chartered Accountant with KPMG in 2007.
He now lives in Bristol, enjoys playing tennis, squash and golf and participating in at least one ski trip a year.
- BVG Airflo Group (Board Observer)
- Canburg (Board Observer)
- Sub10 Systems
- Magma Global (Board Observer)
- SHS Integrated Services
Ned works in BGF’s investment team in the South West and is responsible for finding and completing new investment opportunities as well as continuing to work with the boards of BGF’s investee companies.
Ned joined BGF in January 2012 from Maven Capital Partners (formerly Aberdeen Asset Management) having worked in their London office since 2007. He has completed more than 20 equity investments and has been involved with the boards of most of these companies. Earlier in his career Ned worked in corporate finance with BDO Stoy Hayward and previously qualified as a Chartered Accountant in 2001.
Ned graduated with a BSc in Oceanography with Mathematics from Southampton University. He lives in Bristol and is married with three young children. Ned is an improving golfer, a keen snowboarder and a declining footballer.
- BFF Nonwovens (Board Director)
- APSU (Board Director)
- Ecovision (Board Director)
- Sub10 Systems
- Trunki (Board Director)
- SHS Integrated Services
- Direct Online Services (Board Director)