The Bank & Biotech
By Dr Vicki Hazley – Senior Associate
The Bank
The Scottish National Investment Bank was launched in 2020 to provide mission led impact investment to support the sustainable growth of Scotland’s economy and address three of the most significant Grand Challenges facing Scotland over the coming decades – the climate emergency, place-based opportunity, and demographic change.
Our missions are outcome orientated and serve as the primary filter through which our investment decisions are made, supporting delivery of both commercial and mission-impact returns:
Scaling Up Biotechnology
To achieve our missions, we focus on providing patient growth capital to those businesses who are scaling up to meet the challenges of the future. In March we released our paper ‘Scaling Up Scotland’ in partnership with the ScaleUp Institute, where we set out how important scaling businesses - those achieving 20% revenue and/or headcount growth over 3 years, starting from more than 10 staff - are to Scotland’s economy.
Scaleups accounted for just 0.52% of the total number of Scottish SMEs in 2021, but they generated one third of the total SME turnover, contributing £36.12 billion to the Scottish economy. In 2021 there were 1,770 scaleups operating in Scotland, with an average turnover of £20.1 million.
Scaleups are 61% more productive than the average enterprise, and they are innovative, with 8 in 10 introducing new products, services or processes in the last 3 years.
This is where the biotechnology sector is really interesting; a sector we know to have the highest rate of research investment amongst the S&P500. Our Scaling Up Scotland report showed that whilst scaleups are found in every sector, Scotland has particular strengths in health and the professional, scientific and technical sectors. Coupled with world class University research and interface organisations such as our Innovation Centres, we have a really strong foundation on which to build world-leading businesses in this sector. With over 60 companies operating in the biotechnology space in Scotland, we’re excited about the potential this sector has in the transition to a greener economy, and in how we can support this.
If we look at industrial biotechnology from our mission-perspective, we can see that it could cut across many of our Grand Challenges, whether that is greener chemical production and processing, biofuels, bio-based packaging, materials and energy, sustainable food, health and biopharma and many more. I can see the potential for biotech to play a role in all three of our Missions – innovation, net zero, and of course place, given our natural resources and clusters of expertise in areas like marine science and energy.
We want to see new and existing industrial biotech companies supported, from spin-outs, through start-ups, right through to scaling up and beyond. We are keen as an organisation to engage with the biotechnology sector to ensure that we can do what we can to support mission-relevant scaling businesses by providing patient capital and an appetite for impact-led investments.
The Scottish National Investment Bank provides debt and equity of between £1m and £50m to Scottish business and projects that are aligned with one or more of our three core missions of innovation, net zero and place, and where our funds will enable positive impact for Scotland. Vicki is a Senior Associate within the Bank’s Investment Origination function. Following a PhD in organic chemistry and some time in industry, she spent 10 years in Scotland’s economic development agencies before joining the Bank in 2022.
Scaling Up Scotland | Scottish National Investment Bank (thebank.scot)
Impact Report | Scottish National Investment Bank (thebank.scot)