To scale or not to scale?

A new space in White City is making the decision easier.

Whether it’s a noun or a verb, the phrase ‘scaleup’ is used a lot in entrepreneurial circles to explain the time when a company really starts to grow. And, although there’s relatively clear definition around when scaling up begins, there’s less clarity around when the process finishes, meaning that it’s often a time of uncertainty and challenge.

What is a scaleup?

• It’s a company going into a distinct phase of growth that will take it to the next level. • The Organisation for Economic

Co-operation and

Development (OECD) definition of high growth is a company that’s achieved a 20% or more increase in either employment or turnover year on year for at least two years and a minimum employment count of ten. • The company has generally been through its first rounds of funding and has reached

Series A or similar.

It’s a commonly held misconception that, due to their impressive growth and exposure, scaleup companies no longer need help. In reality, it’s often during this phase that they’re at their most vulnerable, requiring more support than in their initial startup stage.

Scaling in the UK

The UK seems to be an excellent place to start businesses but company growth can be a challenge. The region is in the top three in the world for startups, yet only makes the top ten for scaleups (source: OECD). This gap has been recognised by Imperial College London and venture builders Blenheim Chalcot. Together, they’ve formed a partnership to address this problem and one of the major outcomes is Scale Space – an impressive building at Imperial’s White City campus that’s purposebuilt to help scaleups grow.

One size definitely does not fit all

Mark Sanders is the CEO of Scale Space – a network that brings together venture builders, universities, corporate investors and companies to unlock the potential of UK innovation. It consists of an online community alongside a series of dedicated spaces of which White City is the first. “There’s a real challenge in scaling up businesses,” he says. “What we’re trying to do is help companies overcome this by enabling them to access three important forms of support: expertise and talent from within a worldclass university, business expertise from ourselves and partner organisations, and a peer community where people can share experiences of their scaling up journey together.”

The Scale Space building at White City is impressive. Not only in size and amenities, but in its adaptability and provision of tailored space. Scale Space doesn’t just offer different categories of space, but a spectrum that spans across combinations of type, size and lease time – ranging from a hot desk for a day to a laboratory. One of the building’s initial residents – DNA-e – is a life sciences company developing pointof-need DNA sequencing on a microchip, while sustainability scaleup Puraffinity has recently moved in and will be developing their smart material platform to combat pollution from persistent chemicals. Both have taken lab and office space.

“There’s a myriad of different requirements in the market and we want to make sure we have flexibility to meet them,” says Sanders. “Some companies are well funded and established with a clear line of sight to where they’re going, so they can make longer-term choices about the space they need and how they want to personalise it for their business. Others are not so certain about their requirements and, for them, it doesn’t make sense to spend money on tailoring their space. So we never try to pre-judge people’s requirements.”

This flexibility is instrumental in attracting a diversity of companies. Alongside a growing life science cluster, you can find deep-tech companies, as well as a range of digital ventures working on solutions to challenges such as digital transformation and interactive teaching. “I’m a big believer that diversity in our community is good for everybody,” comments Sanders. “It’s really exciting to have this vibrant community that stands for something and is a much bigger offer than just a desk within an office.”

Communities and metacommunities

As the building progresses, so too do the communities it houses and, from the outset, these have been established as an important part of the project. They work at many levels, with one community formed around leadership and providing a safe space for leaders to discuss their issues and challenges. There’s also a more general online community, providing a national reach for exchanges of knowledge and experience.

As the number of companies increase, there are proposals for communities based around functions such as HR, technology and marketing. Talent clinics have already

If you were trying to build the best place for someone to grow their business – that would be Scale Space.

Mark Sanders, CEO of Scale Space

The UK scaleup landscape

7,474

In 2020, there were 7,474 visible scaleups in the UK – a 37% increase on the previous year.

80%

Visible scaleups have shown resilience during the COVID-19 pandemic, with almost 80% in the UK showing indications of positive or only moderate impact.

£5.32

BILLION

£5.32 billion was invested into visible UK scaleups in 2019.

x2

The total number of female-founded visible scaleups in the UK has doubled in a year.

been created to support residents with recruitment and team building and to give access to Imperial’s talent and academic expertise.

A living experiment

An important resident in Scale Space is Imperial College Business School, which has a 12,000 square foot purpose-built space dedicated to teaching and research.

Researchers from the Business School are already developing projects with the resident companies inside Scale Space including a diary study on how CEOs and founders use their time, and a project looking into how senior teams network.

The Business School will also have elements of its MBA and Masters degrees taught inside Scale Space in new lecture theatres designed for multimode teaching. Students will have the opportunity to forge connections with the resident companies within Scale Space as well as the wider entrepreneurship community of White City.

“In practice, this physical co-location of academics and companies is highly unusual,” says Sanders. “And it’s providing some fantastic synergies whereby academics are collecting really interesting data to support and refine their hypotheses and companies are getting some objective insight and perspective on their businesses.”

And while the Business School will be collaborating on projects with the other residents and teaching parts of its degree programmes in the new building, the team at Scale Space is regularly surveying members to help shape the space so it remains purpose-built and adapted to their needs.

The pandemic itself has necessitated changes, such as equipping the 120-seat auditorium with better acoustics, multiple microphones and top-ofthe-range audio–visual equipment so it can now host hybrid events where the audience can attend in person or watch via live stream. The venue has also recently installed a recording studio, as many residents are developing podcasts and video as part of their marketing strategy.

“By having a presence within Scale Space, the Imperial College Business School is at the heart of the latest thinking to help businesses scale up. By providing a unique environment for our students and academics to forge important connections with the other Scale Space members, we’re bringing our world-class research, talent and expertise to these businesses and the wider entrepreneurial ecosystem of White City.”

Francisco Veloso, Dean of the Imperial College Business School

Future outlook

Scale Space was launched in July 2020 and, although the country was in the grips of the pandemic at the time, the uniqueness of its offer has meant it continues to be in demand. Puraffinity has recently moved in and taken 3,500 ft2 of office and lab space while the final 40,000-square-foot area, although it is yet to be completed, is seeing strong demand already. The hope is that this impressive space not only benefits members directly through the networking and support it provides but, by doing so, highlights its companies as being stable and valuable investment opportunities. “There’s money in the UK to invest in these kinds of businesses,” says Sanders. “And the more we show they have access to the support they need to grow, then the more attractive this sector will be to investors, enabling the UK to keep hold of its scaleups.”

Puraffinity

Puraffinity aims to fix nature’s threat of water shortage with nature’s capacity to make biomaterials that can remove chemicals that are polluting the environment. It’s brilliant, focused and time-sensitive – regulation will soon be introduced to limit levels of one of its target pollutants – which means it’s vital it receives the right support and accesses the right space at the right time in its growth.

Now the most recent addition to the Scale Space community, the company is already well and truly embedded within the Imperial Enterprise ecosystem. Originally formed under the name CustoMem, the team took space at the Imperial Bioincubator at South Kensington in 2015 and when the Imperial White City Incubator launched in 2017, Puraffinity became the first member of its second shared lab. The company moved into its own lab there mid 2018 and along the way the team have taken part in the 2014 Venture Catalyst Challenge and WE Innovate programmes. “As Puraffinity has grown we have been able to draw on the different elements of the Imperial enterprise ecosystem,” says CEO Henrik Hagemann. “And there has been a natural match between our needs and Imperial’s offer along the way. Our next step is Scale Space…. having looked at more than 30 properties in the area we instantly fell in love with the peer learning community at Scale Space where we can engage and share knowledge with rapidly growing companies from different areas. Our goal for our time here is to become a leading material science scale up with commercial operations across three continents, manufacturing in the UK and deeply connected R&D efforts.”