Scaling-up medium sized businesses are the heroes of the economy

Medium sized scale-ups are the driving force behind the UK's growth, but there is potential to achieve even more

Medium sized businesses are critical to the success of the UK economy. These businesses are ripe for growth having already proven their business concept and achieved some scale.

Punching far above their weight, medium sized businesses have an impressive track record when it comes to economic growth. Despite accounting for less than 2% of businesses, firms with 50-499 employees are responsible for 1 in 6 jobs and generate nearly a quarter of private sector revenue. [1]

Within this vibrant section of the business landscape, a relatively small number of MSBs are propelling the UK economy to new heights. In 2010, the 11% of MSBs – around 3000 businesses - that scaled-up over the next three years contributed an additional £59bn to the economy. [2] This during a period when the entire economy only grew by £39.8bn.


Scaling-up MSBs added billions to the economy between 2010-13

  • In 2010, these ambitious MSBs already contributed £57bn, by 2013 they generated £116bn – a turnover increase of 103%
  • These scaling-up mid-market firms helped drive the 2.7% growth in the economy between 2010 and 2013, without their influence there would have been a 1.3% decline
  • The precedent is there for MSBs to be achieving even more; between 2005-08 over 15% of mid-market firms scaled-up, compared with 11% in the 2010-13 period

Scaling-up definition = a business growing by 72.8% or more in either turnover or employment over a 3 year period

  1. This definition is the equivalent of the OECD scale-up definition of average annualised growth of 20% per year for a 3 year period.
  2. Crucially our definition captures a wide range of fast growth journeys, instead of just consistent linear fast growth.

Scaling-up MSBs are critical to the economic health of the UK - while mid-market firms punch above their weight, scaling-up MSBs deliver the knockout blow.

Though this performance is exciting, there is the potential to reap even greater rewards from this dynamic section of the economy. Before the credit crunch impacted upon their growth, 15% of MSBs were achieving scale-up status and we have not yet got back to this peak.

Now, with the shackles of the recession lifted, the emphasis must be on supporting and encouraging more MSBs to start their scale-up journey.


[1] CBI, Future Champions, 2011

[2] Experian, Scale-up Analysis, 2015

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