A Presentation originally delivered to Lancashire County Council analyzing High Growth Businesses in the County of Lancashire

1. Growing Our Way Out of
Recession: Supporting Fast
Growing Companies
Friday 12th November 2009
Ged Mirfin – BLNW Chief Data Officer
Landes Land – Lead Data Warehouse Developer
Presentation to Lancashire County Developments Ltd.

2. What is the BPI
• Nationally Recognised “Business Objects” data
base covering businesses in the North West.
• An evidence based data warehouse.
• Used to inform decision makers about planning
interventions or policies.
• Compliant with Data Protection legislation
• Is the central repository for Business Link data
and Management Information
• A system that can map commercial business
classification systems to the language used in
Local Government and Business Support
• The first B2B profile driven database in the
public sector

3. The Business Barometer is
Changing from Stormy to…?

4. Which companies will lead us out of
recession?
240
220
200
180
Percentage
UK Average
Gazelle Low
160
Gazelle High
140
120
100
80
Year 0 Year 1 Year 2 Year 3

5. Can public sector support
agencies identify these
companies…
... and should we?

6. Which Companies Will Lead Us Out Of The
Recession?
• Some Economists believe that 50% of new jobs will be
from less than 1% of a regions company base.
• High Growth companies (Gazelles) will increase
Turnover by between 25% and 30% in the next 4
years.*
• Although Employee Growth will lag behind it is likely to
be in the region of 20% per annum.*
• Can Public Sector agencies stimulate growth and
ensure that Gazelle Companies fulfil their maximum
potential?
• Can Public Sector support agencies engage effectively
with these companies and should we try?
*NESTA – “Measuring Business Growth: High-Growth Firms and Their
Contribution to employment in the UK” – Oct 09

7. Tracking Gazelles
• Route out of recession is to back gazelles
• A gazelles are defined as small, fast growing companies (in reference
to the fact they can jump higher and run faster than their peers),
• Gazelles according to one accepted definition are defined as
companies that have experienced at least 60% growth in employment
and additionally deflated turnover (turnover adjusted for inflation) over
a 3 year period.
• But…they are extremely difficult to spot
• In the current economic climate especially so….
• Many Gazelles caught in the cross-hairs as the economic recession
continues to find its mark wounding some, badly disabling others and
bringing an unfortunate minority to their knees
• 3 Years Growth is now more likely 2 Years Growth and 1 Year
of Decline
• Some Gazelles are now not able to run as fast or jump as high
• Even in more favourable Economic conditions trained
Business Hunters found Gazelles difficult to target:

8. Conserving Gazelles
Prominent Markings to
look for: Scientists and/
Young (Late or Academics
20s/Early 30s), Independent
Highly Educated Businesses
Business Owners
High Technology
Entrepreneurial Knowledge –Based
Businesses
Niche activities or
Specialised Advanced
Product Offerings Manufacturing Newer
within Older or using Precision Businesses do
Traditional Technology not have SIC
Industries Codes
Opposite Ends Risk
Based on Specialist Spectrum 75%
Industrial Parks & Low/25% Very High
Technology Centres Risk

9. What is Commercial Mosaic?
•Commercial MOSAIC is a business classification system
•Categorises UK businesses into 13 groups and 50 distinct types,
based on key variables that influence business behaviour
•It uses a descriptive naming convention
•Commercial MOSAIC segmentation system
includes:
•Demographics – Age of business, number
of employees, turnover, principals’
background
•Classification – Businesses with shared
demographics are grouped together
•Propensity – Broad description of the
classification that indicates a business’ likely
behaviour, for example, in its purchasing.

10. The Family or Genus Gazelle
Commercial Mosaic Commercial Mosaic Features
Group Type
Directors under 30 & Well Educated
Highly productive and skilled work force
Mature businesses -64% Employ >100
Monumental Monoliths Farsighted High Flyers Large Range Business Activities inc. Food, Manufacturing, Textiles,
Recreation, Sport, Luxury Goods – Niche Business
Trade Specialist Industrial Centres or Retail Parks
Highly specialised type engaged manufacture specialist equipment and
precision instruments esp. telecomms & IT
Specialist Suppliers Hi Tech Highlights Medium Sized Businesses
Independent
Based Specialist Industrial & Technology Parks
Newer Independent Businesses
High Risk – 30% Chance Failure
Wide Range Activities: Specialist Wholesale, & Retail, Business Support
Independent Entrepreneurs Developing Dynamos Services & Recreation
Small Business but with Very High Amounts of Turnover from Highly Skilled
& Productive Staff
Especially Prevalent in North West
New Independent Businesses. One Third 2 to 3 Years Old
So New many not have SIC Codes assigned to them
High Risk – 346% Chance Failure
Independent Entrepreneurs Wide Range Activities: Specialist Wholesale, & Retail, Business Support
Fledgling High Fliers
Services & Recreation
One Third Grow to Employee Much Larger Nos. of Employees
As Specialist Suppliers first move is generally to specialist industrial parks
Independent Low Risk High-Tech Businesses
Engaged Diverse Range of Activities but esp. R&D and Chemical Processing,
Energetic Enterprises Professional Professors Especially Prevalent in Northwest Trading from Specialist Industrial &
Technology Centres near Universities & Hospitals
New “Knowledge-Based” Businesses
Especially Prevalent amongst Digital & Crossover Media, Support Services to
Energetic Enterprises Support Supremos Financial Industry – High Salaries
Low Risk Businesses in Areas of High Prosperity. Serviced Offices

11. Gazelles
A gazelle company is an American expression for small, fast growing companies (in reference to the fact they can
jump higher and run faster than their peers), that creates many job opportunities. Fast growing firms ("gazelles")
are defined as companies that have experienced at least 60% growth in employment and additionally deflated
turnover (turnover adjusted for inflation) over a 3 year period.
Baby Gazelles: Galloping Gazelles: Large Gazelles:
Young, and usually Fast-expanding “little Gazelles who turn into
small, high growth giants”. Dynamic SMEs major corporations.
enterprises often in new Grow very quickly
Young, start-up or spin- industries that generate from Start-Ups into
out firms. large numbers of new Large
“Adolescent” High-Tech jobs. Organisations
Companies. The subset of high-
growth enterprises Farsighted High Flyers
Developing Dynamos, which are 3 but typically
Fledgling High Flyers, 5 years or older.
Professional Professors
Hi-tech Highlights,
Support Supremos
“Early Start-up “Early Maturity “Late Maturity
phase: Phase: Phase:
Up to 3 Years” 3 to 7 Years” 7 to 10 Years”

12. The Power of the BPI: Identifying High Growth Potential Companies
How do you Identify a…
North West Actively Trading
Business Locations (425,770)  …company that is in a
potential high growth
classification…
MOSAIC Gazelles (66,700)  …that is mature…
 …with a reasonable
turnover…
Age Over  …employing 10+ people?
Three Years (18,491)
Turnover
Above £400k (1,465)
What do these look like?
Employing 10+ (440)
-This information is based on data provided by Experian. The data has been subject to further analysis by Business Link North West

13. The Power of the BPI: Identifying High Growth Potential Companies
North West Actively Trading
Business Locations (425,785)
MOSAIC Gazelles (66,702)
Age Over
Three Years (18,490)
Turnover
Above £400k (1,464)
Employing 10+ (440)
-This information is based on data provided by Experian. The data has been subject to further analysis by Business Link North West.

14. The power of the BPI: identifying potential high growth companies
-This information is based on data provided by Experian. The data has been subject to further analysis by Business Link North West

15. The size of the prize – economic impact
High Growth Companies
445
Average Headcount
Current Headcount
3 Year Headcount Growth
New Jobs Average Turnover
Current Turnover
3 Year Turnover Growth
New Turnover
Estimate Estimate
120%
25
11,125
13,350 £1.0m
100%
£445m
£445m

16. Action Plan Statistics
Action Plan Themes: Intensively Assisted Gazelles
Theme Occurances % Theme Occurances %
Sales & Marketing 18 12.68% Export 6 4.23%
Training, Skills & Workforce
Development 16 11.27% Staffing, Recruitment & HR 4 2.82%
Supply Chain Membership &
Network Access 15 10.56% Graduate Placement 3 2.11%
R&D, Innovation & NPD 12 8.45% Environmental Directives 3 2.11%
Business Diagnostics, Knowledge Transfer
Benchmarking & Planning 12 8.45% Programme 2 1.41%
Raising Finance, Capital
Expenditure & Debt
Refinancing 10 7.04% IPR 2 1.41%
Leadership, Management &
Business Coaching 8 5.63% Subsidiaries 1 0.70%
Process Improvement, Efficient
& Lean Manufacturing 8 5.63% Health & Safety 1 0.70%
CRM & Database Management 7 4.93% IT 1 0.70%
New Market Entry & Market
Research 6 4.23% Succession Planning 1 0.70%
New Premises, New Build &
Business Relocation 6 4.23% Total 142 100.00%

17. The difference with Gazelles is not the type of question
they ask it’s the complexity of the issue they face…
Category of Assistance Gazelle Specific Example
R&D, Innovation and NPD Collaborating with local Higher Education Institution
in Grant Funded R & D Knowledge Transfer Project
Sales & Marketing Market Scoping Research Project on Need for
Specialist Footwear for those who suffer general foot
discomfort in order to offer products into the
mainstream market
Training & Skills Training of Specialist Staff working in the
construction, manufacture and assembly of
equipment in the Nuclear Industry
New Machinery, Process Improvement, Improvement Production Processes in Specialist
Retooling Marine Manufacturing Company producing products
for the offshore oil extraction industry
Capital Expenditure Access to Finance for Relocation Precision
Manufacturing Plant
Relocation & New Premises Consolidation of Manufacturing Plant on Single Site
Location including relocation Welsh Manufacturing
Plant to North West
Export JV in Eastern Europe
Relationship Management, Networking, Obtaining Membership of and Maximising Network
Membership Cluster Organizations/Networks Opportunities through the Northwest Aerospace
Alliance

18. Locating Gazelles: Geography & Sector
• Key Segments (82.45% of Total) include: Developing Dynamos (29.1%) - Newer
Independent Businesses involved in Specialist Wholesale, & Retail, Business
Support Services & Recreation employing Highly Skilled & Productive Staff;
Support Supremos (28.64%) New “Knowledge-Based” Businesses Especially
Prevalent amongst Digital & Creative Sector - Crossover Media Businesses
and Hi-tech Highlights (24.71%) Highly specialised type engaged in the
manufacture of specialist equipment and precision instruments especially
telecommunications & IT, based on Specialist Industrial & Technology Parks.

19. Gazelles – Defining Features
• Gazelles concentrated in Strategic
Investment Areas - 62.36% in Objective 1
& 2 Zones
• 58.43% however are concentrated in
Wards exhibiting Average or Above
Prosperity
• SIC is virtually useless when it comes to
identifying Gazelles 25.17% of the
Gazelles we identified have SIC Codes
beginning with Other or Ending with the
phrase Not Elsewhere Classified!
• 65.13% of the Gazelles we identified had a
turnover less than £5M.

20. Lancashire

21. Issues
• Gazelles require complex kinds of
support placing much higher levels of
demand on Public Sector Agencies
• Gazelles are “Elite Businesses”.
• Supporting them is resource
intensive requiring prioritisation at
the expense of existing Business
Sectors!
• Should We Be Doing This?

22. How can we work together
to ensure that we combine
BLNW’s intelligence with
the experience we have in
the region?