10th September 2011
Next Friday, the annual awards dinner for the Wales Fast Growth 50 will take place in Cardiff.
I am proud to say that the event has been sold out for weeks and promises to be another night that celebrates the best of Welsh entrepreneurship.
The dinner will be followed, on September 21st, by the publication of the thirteenth Fast Growth 50 supplement in the Western Mail.
Having spent every spare hour during the last four weeks putting this together, I am proud to say that the profiles of every business featured this year is a testament to the variety of successful ventures of all sizes that flourish in all parts of Wales.
Yet, it would seem that those in charge of economic development in Wales remain reluctant to engage with these high potential companies.
Even when the Welsh Government, six years ago, acknowledged that it should give extra support to a smaller group of firms through the knowledge bank for business (KB4B), there were very few Fast Growth 50 firms invited to join. Instead, the vast majority of participants on this programme were mainly the so-called anchor companies so beloved of the CBI and the current government.
Given the fact that every year, the fast growth 50 firms make a disproportionate contribution to the Welsh economy and have the potential to grow further with the right support, one has to wonder why they continued to be ignored by policymakers in Cardiff Bay?
Interestingly, the same issue has recently been raised in Scotland, following a study of high growth firms by Professor Colin Mason of the Hunter Centre for Entrepreneurship at the University of Strathclyde.
According to Professor Mason, there are 825 high growth firms identified that make up only 4 per cent of the Scottish business population. However, they employ almost half a million people and account for 50 per cent of all new jobs in the economy.
Following the publication of this study, more enlightened policymakers in Scottish Enterprise (the main economic development body North of the Border) have come forward to propose that increasing the number of fast growing firms could have a transformational impact on the Scottish economy. They estimate that increasing the number of high growth firms by 25 per cent over the next decade could create over 100,000 jobs.
It is also worth noting that, as with every Fast Growth 50 list for the last thirteen years, those firms growing quickly in Scotland were to be found across a wide range of industries, with very few operating in high technology sectors.
Indeed, Colin Mason was at pains to emphasise that policymakers should not prejudge the sources of high growth firms and the eligibility criteria for business support should be as open as possible.
Contrast that with the current logic of the Welsh civil service, which led to the last Minister responsible for economic development to focus only on six key sectors, with financial support only available to those businesses within a narrow range of industries.
Perhaps the key finding from the Mason report, replicated in other studies, is that you do not need to be based in a technology sector such as biosciences or ICT to engage in innovation and grow.
On the contrary, the Scottish research found that most growth firms, regardless of industry, were highly innovative, customer focused and internationally orientated.
As a result of this work from Strathclyde, it would seem that Scottish Enterprise has appreciated, unlike the Welsh Government, the scale of the opportunity and the importance of nurturing those companies that can develop into the big players of the future.
We will have to wait and see whether the Scots now focus their policy efforts on those companies that have the ability and appetite to grow but certainly, there is finally an appreciation in one devolved administration that it can, even without fiscal powers, help develop the indigenous business base and perhaps create some of the real supergrowth companies of the future.
One can only hope that politics and policymakers in Wales have a similar revelation soon.
