Scaling from Startup to SME Guide

Scaling from Startup to SME Guide

Key takeaways from the IoTUK Scaling from Startup to SME Guide

The transition from startup to SME can be a painful and disruptive experience.
The UK government has a strong interest in helping IoT SMEs grow.
Managing growth must be a key part of your strategy when scaling up from startup to SME.


Small and medium sized businesses play a fundamental part in the UK economy. The UK’s Department for Business, Innovation, and Skills reports that small businesses accounted for 99.3% of all private sector businesses at the beginning of 2016. They employed close to 16 million people, representing 60% of the private sector workforce.

The UK technology sector represents a rich source of innovation and potential, which if effectively nurtured could help to drive growth in the UK economy. In recognition of the importance of startups to the UK economy, in his 2016 autumn statement the UK’s Chancellor of the Exchequer Philip Hammond announced that he would give £400m to venture capital funds specifically to invest in supporting startup companies. This commitment builds on the investment the UK government has made in Innovate UK, and the Digital Catapult programme. These programmes, coupled with initiatives from organisations like the FSB (formerly the Federation for Small Businesses), are all designed to promote innovative young businesses by providing them with support and advice as they grow from idea to startup and then to small business and beyond.

Scaling from Startup to SMEHowever, starting a business remains a challenging undertaking. Nearly half of all small businesses fail within their first five years, and for many it is the transition from startup to SME that creates the greatest challenge.

In this report, Digital Catapult’s IoTUK programme looks at the range of issues that startups need to address to make their first leap in scale, and advise them on how they should prepare for this phase in their lifecycle, examining how they should position themselves for future growth. In the domain of the IoT, these challenges combine with a complex ecosystem in which partnership and collaboration also form a key ingredient in delivering sustainable growth.

Startup to SME

IoTUK Staff
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