LinkedIn co-founder Reid Hoffman has joined forces with angel investor Sherry Coutu to launch the Scale-Up Institute, a new organisation aimed at closing the UK’s scale up gap.
Last year Coutu authored the ‘Scale-Up Report’ which found that a small group of rapidly expanding ‘scale up’ companies create a significant proportion of the UK’s economic growth.
However, the UK lags behind other leading economies in the relative proportion of these vital companies and the report claims that the reward for the UK would be huge should it be able to close this ‘scale up gap’.
RBS analysis suggests an additional 238,000 jobs and £38bn additional turnover is possible within three years of reversing the scale up gap.
Meaning increased productivity in all sectors of the economy, the current productivity gap is costing the UK £92bn per annum.
To remedy this the report called for greater government and private sector emphasis on those businesses with real potential to benefit the economy. It also identified that most scale ups and growing companies face similar issues and needs across capital, management, skills and organisational processes.
The report highlighted six key areas to work on to close the gap and 12 recommendations on how to do so. The Scale-Up Institute will be an executive office following the objectives and solutions identified.
Coutu, executive chair at the Scale-Up Institute, said: “I am humbled by the support that has gathered behind scale-ups and excited by the opportunity to make the UK not only the best place on the planet to start a business, but also the best place to grow it into a substantial one.”
The London based Scale-Up Institute, aims to be fully functioning by September and will be funded by companies including accountancy and investment group Smith and Williamson.