Vast majority of country’s high growth businesses continued to thrive in the onset of the pandemic
92% of Scotland’s scale up companies successfully maintained a strong upwards growth trajectory in the first year of the pandemic, reveals independent Scottish law firm, Morton Fraser.
According to newly published data from the Office of National Statistics, 745 of the country’s 805 high growth businesses* in 2019 continued to perform well going into 2020, and increased their growth despite the pandemic.
22 local authorities managed to maintain or increase the number of scale up businesses in their region in the first year of the pandemic, while just 10 council areas saw their count decrease.
Dundee, Inverclyde and North Lanarkshire all ended the first year of the pandemic with more scale up businesses than they started with, while Angus saw the largest proportionate drop in businesses.
Iain Young, Head of Morton Fraser’s Corporate Growth team, said: “While these figures represent the turbulent business landscape that the pandemic brought about - creating growth opportunities for some, while presenting challenge after challenge for others – they show the true tenacity of the business community in Scotland, as many companies were able to weather the storm.
“2021 saw an unprecedented level of investment into start-ups from Scotland’s business angel community, and we expect this to contribute significantly to strong business growth.
“It is key now that those that have made it through to this stage continue to be protected and nurtured; we must recognise the significance of the successes from within Scotland’s high performing sectors. While we may have fewer businesses growing overall, many of those which have performed well have grown exponentially, and their opportunism and focus should be applauded.”
The pandemic also brought with it a 17% fall in the five-year average number of births of high growth companies, however there was no increase in the number of high growth companies ceasing to operate.
Iain added: “We have seen artificially low levels of business deaths and insolvencies thanks to the government’s business protection measures. However, we can expect to see a change in these figures as these measures fully expire in March 2022.”
First published in The Scotsman.
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