Shaping our Future Economy through Innovation

Helping innovative businesses to develop and grow is crucial to unlock economic growth and and create more skilled and highly paid jobs across the UK, argues Dr Ruth McKernan CBE.

“The best way to predict the future is to invent it” – Alan Kay’s words come to mind when I speak with the many companies that Innovate UK supports. The UK’s innovative businesses that are developing the technologies and services of tomorrow. We are on the brink of the fourth ‘industrial revolution’, where physical, biological and digital worlds meet. Businesses that can compete in this new world – or better still, shape it – will be the creators of strong economic growth for our country. Disruptive technologies are redefining how we innovate, how we design new products and how we deliver services to customers.

Digital companies like Snap Fashion are redefining the way we shop for clothing online and on the high street. Healthcare companies such as Owlstone Medical and Oxford Biomedica are reinventing the diagnosis and treatment of disease.

But innovation like this is a risky business, and it doesn’t happen by chance. Strategic collaboration between the public, private and academic sectors is vital.

As the UK government’s innovation agency, Innovate UK works alongside the private sector, de-risking innovation, helping get ideas off the drawing board, or out of the lab, and providing confidence to the private sector in its investments in the UK’s industries of the future.

These investments are critical to companies’ growth, and do reap rewards: the Biomedical Catalyst, a collaboration with the Medical Research Council, has returned £1 billion of private sector investment to the economy. The winner of the award for innovation attracting investment at our recent ‘Oscars’ event for small and medium enterprises (SMEs), and also chosen by Minister Jo Johnson for the inspirational innovation award, Dearman, have attracted over £16 million of investment in the past five years. As well as receiving support from Innovate UK and the Office for Low Emission Vehicles, they are conducting a world-first trial with Sainsbury’s to prove the usefulness liquid nitrogen engines in the efficient transport of cold products.

The Prime Minister spoke recently to the CBI on her aspiration to turn the UK’s “bright start-ups into successful scale-ups by backing them for the long term”. Our role in this is to support SMEs to become high-growth, mid-sized companies with strong productivity and export success. Scale-ups are projected to create a million new jobs by the mid-2030s – jobs that are key to an economy that benefits the whole country.

Just a few weeks ago, seven companies (Dressipi, Geo, Hiring Hub, Metail, SEaB Energy, Snap Fashion and Undo) supported by Innovate UK were announced as Scale Up Club members for 2016. Members of this prestigious group have been identified as those most likely to build a £100 million global business within the next three to five years. Software de-bugging company Undo’s third consecutive membership of the Scale Up Club is an impressive demonstration of its high potential for the future. Many of the seven companies are in the digital sector; we supported them with small amounts of funding early on in their development. Growth of digital businesses has been so good that much of this sector is now independent of Innovate UK’s support with a strong showing from private investors.

Britain’s ambition for business, a key message from the Prime Minister’s speech, was expanded in the Chancellor’s Autumn Statement. Businesses have welcomed the announcement of a new Industrial Strategy challenge fund. A challenge-led approach is important to allow the UK to support emerging fields where the UK has a proven strength and where there is a significant economic opportunity for commercialisation; areas such as robotics and artificial intelligence, industrial biotechnology, medical technology, satellites and advanced materials.

For our part, we will be partnering with the Research Councils to make sure the fund unlocks the full economic and business growth potential of our world-leading science base, creating more skilled and highly-paid jobs right across the UK. The task at hand is to carefully formulate the detail of the challenges to encourage aspiration and economic growth across all the nations and regions of the UK.

The future is bright for UK research and innovation. I am in no doubt that innovative British companies share Steve Jobs’ ambition to make their mark and “put a ding in the universe”. A new Industrial Strategy challenge fund lays the groundwork for growth, and we are committed to ensuring it is well spent, to enable the industries of the future.