Susie Harris, director of business development at Parkwalk Advisors, the fund management business of IP Group PLC (LSE:IPO), talked with Proactive's Stephen Gunnion about how UK government policy changes are set to improve the funding landscape for deep tech companies and university spinouts.
Harris welcomed the decision, announced in Chancellor Rachel Reeves' Autumn Budget statement, to double the limits for knowledge-intensive companies from £20 million to £40 million, describing it as a “pretty significant change” that will allow companies to scale further and remain rooted in the UK. She explained that deep tech businesses often require funding “well in excess of £20 million” just to reach revenue generation, and that the previous cap had created a funding gap between early-stage and scale-up investment.
Harris highlighted that the move should help prevent UK-born innovations from being acquired too early: “The UK has become a bit of an incubator economy… many of those [companies are] acquired before the businesses really have an opportunity to scale up within the UK.”
Harris also discussed the role of the British Business Bank, UK Research and Innovation, the British Growth Partnership, and the National Wealth Fund in catalysing investment across the growth curve. These bodies, she said, could work together to turn the UK from an incubator economy into a scale-up economy.
She added that later-stage institutional capital, particularly from pension funds, would now be better positioned to support the global growth of domestic tech companies. “Some pretty significant capital is required at those later stages to enable deep tech companies to establish themselves as global businesses,” Harris noted.
Looking ahead, Harris said Parkwalk Advisors and IP Group see “an extraordinary opportunity for these businesses to now be able to scale and succeed” with the added support of private and public capital at every stage.
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