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Last updated: 3 Jun 2021
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Technology & Media update: Scale-ups have good reason to be positive about the future

Despite it being one of the most challenging years in history for business, there are many reasons for technology scale-ups to be optimistic about the future.

We have been fortunate enough to work with some hugely ambitious and innovative scale-ups across many different sub sectors over the past year including e-commerce, creative, fin-tech and Saas. It’s been interesting to see what steps those companies who have achieved growth have taken, to not just survive but thrive. These are some key characteristics we’ve observed in those who have done particularly well this year.

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Simon Wax

+44 (0)20 7556 1231
waxs@buzzacott.co.uk
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We have been fortunate enough to work with some hugely ambitious and innovative scale-ups across many different sub sectors over the past year including e-commerce, creative, fin-tech and Saas. It’s been interesting to see what steps those companies who have achieved growth have taken, to not just survive but thrive. These are some key characteristics we’ve observed in those who have done particularly well this year.

Opportunity out of adversity

Opportunity out of adversity

Successful businesses we’ve worked with over the past 12-18 months have combined agility and planning.  In order to take advantage of the funding landscape many of our clients have acted quickly to get access to finance, as borne out by our corporate finance team who have completed more M&A transactions in the last quarter than ever before.

However, many of these same clients were already in great shape having put in the  groundwork to ready themselves for growth finance. The focus on  long-term preparation has included a thorough examination of the internal and external factors that might need addressing in their business - both in terms of having readily available financial information, a business structure that works best for expansion as well as having forward-looking business & cash flow model that fits their strategic growth plan.  

Related to this and common across all sectors we work with is that we have witnessed a move towards cloud-based financial software as founders are looking for more support with setting up their internal systems and processes in a way that gives them immediate access to key information. One of our clients, for example, has moved towards implementing a fully cloud-based platform that integrates its financial information and provides KPIs in real-time basis across all of its locations.

Find out more about our cloud accounting advice and implementation support

We have also seen an uptake in requests for statutory audits as startups and scale-ups look to provide greater assurance to potential investors ahead of fundraising activity.

Many of our clients have been looking at overseas expansion as technology continues to break down international barriers for doing business. Common locations, driven by client demand are the US and the far east as well as implementing developing hubs in Central and Eastern Europe. This is being led by demand from overseas as well as the opportunities for employing a more international and diverse workforce. Planning for such an expansion and navigating local compliance and regulations remains a key consideration.

Making best use of help available

Making best use of help available

The government has put in place a number of schemes to continue to support business.  We highlighted many of these in our recent Budget summary. The extension of the furlough scheme and the delay of expected tax increases along with tax payment support and the CBILS will go some way to helping businesses over the coming year.

Alongside this, the UK’s our extremely supportive R&D tax credit regime has helped many of our innovative client to develop new technology and processes in order to grow their business.

Technology is driving our recovery

Technology is driving our recovery

The UK technology sector, with its wealth of talent and access to finance, continues to thrive.  In Q1 2021, the UK saw record levels of investment and is now valued at c. £415bn.  Investment from VCs has also soared with London maintaining its position amongst the most powerful world hubs, indeed more tech unicorns have been produced from London now than the rest of Europe put together.

The UK also remains an extremely attractive place to grow business with 63% of VC investment in 2021 coming from overseas. In addition to the skills base, the reputation of the UK company in terms of transparency and regulation is a key consideration.  

UK tax rates also remain low as compared to most other European countries although we do anticipate capital gains tax increases (which were left untouched in the spring) to be made within the next year. 

Dedicated support for scale-ups
Dedicated support for scale-ups

It is important to continue to plan ahead and keep your house in order to weather any storm as well as take advantage of new opportunities. During the pandemic we put together a scale-up guide which highlights many of the issues that founders will need to address as they shift from survival mode to scaling and taking advantage of the new prospects on the horizon.

Download your copy of our scale-up guide

If you would like more information about the support we can provide for businesses like yours, simply complete the form below and one of our experts will be in touch.

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