North West’s high potential businesses experience £5bn combined turnover growth

A group of 1,400 high-potential businesses based in the North West has experienced combined revenue growth of more than £5bn over the past three years, according to figures revealed by BGF, one of the UK and Ireland’s most active investors.

Employing nearly 300,000 people, this group of businesses in the North West has experienced combined turnover growth of 15% since 2015, more than the West Midlands and Yorkshire.

Almost three-quarters (74%) of companies in the region have grown their revenues in the past three years, a higher proportion than London or the South East.

Neil Inskip, head of BGF’s North West office, said: “Against an uncertain backdrop, the entrepreneurs and companies we meet are determined to get on with their job and continue to grow their businesses.

“For the first time this research shows the extent of progress demonstrated by the SME businesses in the North West, and the figures are really encouraging.

“This group of businesses is the backbone of the regional economy, contributing financially, as well as creating jobs and innovating within their own sector.

“It’s important that, despite wider economic volatility, they still have access to the right support and funding to help them with their growth.”

Highlights include:

• Lancashire has the most SME companies in this category in the region (520), the UK’s third largest concentration of high-potential businesses outside of London
• 271 businesses in this group based in Greater Manchester have experienced 20% combined revenue growth over the past three years, higher than the UK national average (15%)
• Merseyside businesses have reported combined turnover growth of £623m in the past three years

The research has been released as part of BGF’s ‘Ready for Business’ campaign, which will see the investor confidently advocate for continued growth, committing to entrepreneurs and investing in the age of uncertainty.

Former chief executive of Tesco and Pets at Home, Matt Davies, is now chairman at Manchester-based Mission Mars, which received BGF investment in 2018.

He said: “This is such an exciting part of the market to be operating in, and while the current climate isn’t without its challenges for ambitious fast-growth businesses like ours, change can bring great opportunity.

“Those who stand out in their sector and are quick to adapt will continue to grow.”

The research has calculated growth through changes in turnover and employee size among Britain’s private companies with revenues between £3m and £150m, a category of 13,286 businesses nationwide, 11% of which are based in the North West.

The research looks at publicly-reported data. Given current reporting thresholds, this group of companies is likely to be much larger – BGF’s proprietary database indicates that there could be an additional 4,000 companies, increasing the size of this group by 30%.

BGF was founded in 2011 specifically to address a long-standing gap in equity funding directed into companies that have outgrown friends, family or angel funding but are not typically large enough to be courted by traditional private equity.

It has invested £1.9bn in more than 270 companies since 2011, three quarters of which are based outside London and the South East.