Business News Round Up (23/01/2024)
BGF outlines 2023 investment activity in North West
Growth capital investor BGF has revealed it invested more than £55m in small and mid-sized businesses in the North West in 2023. Barry Jackson is leading the team in 2024 following the departure of Neil Inskip, who is leaving BGF after a 12-year tenure. Across the North of England in 2023, BGF reported strong momentum, investing in excess of £115m in SMEs. In total, BGF invested £430m across the UK and Ireland in 2023. Investments in the North West have included £10.5m in high-growth guest WiFi technology business, Purple; £9m in Salford-based software provider, Voicescape; and £5.3m in Leigh-based technology group,KCA Holdings. Positive exit activity in the North West in 2023 has delivered a combined money multiple (MM) of 2.7x. BGF-backed businesses in the region have continued to thrive in 2023, despite challenging economic conditions.
https://www.insidermedia.com/news/north-west/bgf-outlines-2023-investment-activity-in-north-west
More than 38,000 new Scottish businesses in 2023
More than 38,000 start-ups were launched in Scotland in 2023, according to new research from R3. R3’s analysis of data provided by Creditsafe shows 38,313 firms were set-up in Scotland in 2023 – a rise of 12.1% from 2022’s total of 34,168. Richard Bathgate, chair of R3 Scotland, said: “Amidst tough economic challenges including high inflation and the resultant rapid rise in interest rates and supply chain issues, tens of thousands of Scottish entrepreneurs embraced the opportunity to launch new businesses last year. Many of these new ventures are micro and small businesses but will play a crucial role in supporting the growth of the Scottish economy in the year ahead.” Scotland saw the fifth largest yearly percentage increase in start-up numbers across the UK regions and nations. Only Northern Ireland (59.5% rise), Greater London (14.7% rise), Wales (13.8% rise) and the West Midlands (13.8% rise) had more start up activity.
https://www.scottishfinancialnews.com/articles/more-than-38000-new-scottish-businesses-in-2023
Begbies Red Flag report highlights significant stress on UK businesses
The latest Begbies Traynor Red Flag Alert report highlights the speed at which critical financial distress is growing in the UK after the second consecutive quarter of 25% growth. The rapid growth across every sector in the economy means 47,477 businesses are starting the new year in a precarious financial position. Historically, a significant percentage of the businesses identified by Red Flag Alert as being in critical financial distress will enter insolvency over the course of the next year. Across every sector monitored by Red Flag Alert, the levels of critical financial distress grew quarter-on-quarter in Q4 2023, highlighting how the current economic backdrop is having a detrimental impact on every corner of the UK economy. The key sectors driving this increase continue to be the Construction, Real Estate & Property and Support Services sectors, up 32.6%, 24.7% and 23.6% respectively, alongside Health & Education (+41.3%).
UK Government ‘should boost green public investment by £26bn’ for sustainable growth
A new report from the two universities argues the case for an annual investment equivalent to £26bn, to tackle the challenges posed by the climate crisis and environmental degradation while promoting economic growth and productivity. The economists, including Professor Lord Nicholas Stern, author of the Stern Review on climate, emphasise that current plans to reduce public investment in the coming years are likely to result in stagnant productivity and weak economic growth. The report highlights the need to compensate for decades of underinvestment in various sectors, including physical, natural, social, knowledge and human capital, to address environmental challenges and ensure future economic competitiveness. It states: “Continued low public investment, as laid out in the Chancellor’s Autumn Statement of 2023, and ongoing barriers to business investment in productive and sustainable assets, are inconsistent with success in international markets and will likely lead to more stagnation”.