This document summarizes research on "Millennial 2000" firms in the UK - those established in 1998 that were still in business in 2014. Of the original 240,000 firms started in 1998, only about 26,000 (11%) remained in 2014. The research focuses on 1,230 of these firms that created 40 times as many jobs as their original size and 1,131 firms that generated 80 times their original sales levels. These "Millennial 2000" firms now employ around 110,000 people and generate £16 billion in annual sales. The document outlines preliminary findings from a survey of 219 of these firms, including that over half are family businesses, about half export internationally, and they relied heavily on bank financing and advice from

1. The Millennial 2000
Insights into 16 years of Survival and Growth
ERC State of Small Business Britain
Conference Presentation
16th June 2015

2. Context
• In 1998, 240,000 firms were born – most
employed fewer than 5 people
• In 2014 - ~26,000 of these firms still in
business (11%)
• 67% haven’t grown at all

3. Who are the Millennial 2000?
– 1,230 firms had 1-4 employees in 1998
But created 40x number of jobs they had in year one
– 1,131 firms had <£100k sales in 1998
But generated 80x amount of first year sales
– 412 firms in both categories
Created 77x number of jobs they started with
AND generated 137x amount of first year sales

4. M2000 Contribution to the
UK Economy in 2014
• Employ c.110,000 people and generate
around £16bn sales
• On average each M2000 firm now employs
~55 people and generates sales of ~£8.5m

5. Adding Jobs for 16 years

6. Generating Revenues for 16 Years

7. The M2000 Survey
A survey of 500 of these firms to understand….
• How they grew 1998-2014
• Was it a story of ‘luck’ or………………?
• Strategic behaviour
– business model development; markets; innovation;
knowledge sourcing;
• Funding – bank, equity, alternative finance
• External advice – private and public
• Leadership, Management, Skills
– evolution of the ownership/management team

8. What are the M2000 telling us?
[Emerging Findings - 219 Firms]
So far –
• They are in ALL sectors of the economy and in all
parts of the UK
• Over half are family businesses – and many of the
Founders still actively involved in the business
• Predominantly independent businesses and most are
B2B
• 1 in 3 have a formal Board of Directors

9. Period of Most Substantial Growth

10. A story of Exporting and/or
Innovation?
• In 2015 – ~half sell internationally - and those that
are have been exporting for more than 10 years
• … a higher proportion than in the wider economy
(20%)
• 2 out of 3 had innovated but not in the last 3 years

11. Finance
• A third had initial capital of <£10k – almost no PE or
VC involvement
• 1 in 4 actively searching for external finance since
2012 – primarily bank finance (average sought -
£700k)
• Only 1 in 10, of those seeking finance, did not obtain
the finance they were seeking

12. Impact of the Great Recession
• Recession adversely affected about a third
• Many grew substantially during the Great Recession
– how?
– All about UK markets – much less internationally
– Less about innovation
– Not about M&A!
– Most ran down reserves or managed costs

13. External Advice
• Legal advisors, accountants and bank managers
• Around 1 in 3 have made use of government
business support – most of these still doing so
• Thirst for knowledge:
– Technology; professional information; intelligence about
market competitors; skills

14. Now let’s hear from them
directly!
Chris Pick - Pickfisk
Raj Iqbal – Choice Packaging
Solutions