Economically speaking, scale-ups deliver far greater value than their size suggests. Whilst they make up just 1% of SME firms, the ‘sub-sector’ accounts for 8% of SME employment and 22% of SME turnover. Nearly 1 million people are employed in scale-up companies and these businesses have a combined turnover of almost £500 billion.[1][2]
Scotland has just over 2,100 scale-ups, with a pipeline of another 1,000. The current turnover of these organisations totals just over £41bn. Whilst Glasgow takes the lead position, Edinburgh is a close second with 625 scale-ups and a further 265 in the pipeline[3].
As these companies continue to make a large contribution to the digital economy, the question of how they operate is critical if we are to embed sustainability and innovation at the heart of the ‘decisive decade’ for the Scottish economy[4].
Sustainability at speed
Scale-ups offer the opportunity to embed sustainability throughout an economy as quickly as it grows: rapid evolution allows for significant impact. When a business hits scale-up territory, it is usually young enough, or close enough to consumers, to have sustainable business as a core value. This drives the translation of such ambitions into scalable green operations, including renewable energy, circular economy practices and reduced waste.
The rapid growth of a scale-up typically also enables them to exert influence on supply chains. This drives broader sustainability improvements in their suppliers and accelerates the transition to a greener future for other businesses.
Scotland leads the world in this mixture of sustainability, growth and business excellence. For example, in May 2024, Edinburgh-based carbon-capture startup CUU International was named the best small business in the UK[5].
The impact of innovation
When it comes to innovation, scale-ups offer an enticing mix of fresh thinking and novel solutions, repeated multiple times to truly evolve an industry.
Scotland has an enviable track record in developing such businesses, from energy-industry pioneer Smart Metering Systems to Glasgow-based Enough, aiming to replace 5 million cows with 1 billion chickens and reduce CO2 emissions by 5 million tonnes by 2032 with a plant-based protein. Scotland consistently demonstrates what is possible when disruption meets repetition.
Digital infrastructure is a vital part of this ability to embed sustainability and innovation within the growth of the business leaders of tomorrow. Both are dependent on collaboration between teams across the globe and for scale-ups north of the border, the EU, North America and Australasia are the top three export markets[6].
For sustainability and innovation to become deeply embedded within the Scottish industry, every business strategy must pay attention to the presence and potential of scale-up businesses. They offer a route to rapid results and – supported by the right technology – genuine disruption of markets.
Pulsant’s sustainability commitments
At Pulsant we take our responsibilities to our clients, our people, our investors and the wider community seriously. Everything we do in support of corporate governance and sustainable business practices is aligned to our core values. We align with internationally recognised standards on quality, environment and energy management and are committed to working towards a Sustainable planet to protect our resources for future generations.
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[1]For the purposes of reference, by scale-up, we are referring to businesses that had achieved £10.2m in turnover, have assets to the value of £5.1m and / or 50 employees in 2023.
[2]See The scale of the opportunity: How growing firms can contribute to the UK economy - Social Market Foundation. (smf.co.uk)
[3]See scaleup-britain-scotland-scaleUp-index.pdf (londonstockexchange.com)
[4]See Foreword - Scotland's National Strategy for Economic Transformation - gov.scot (www.gov.scot)
[5]See Innovative Scottish startup named best small business in the UK | The National
[6]See scaleup-britain-scotland-scaleUp-index.pdf (londonstockexchange.com)