A Creative PEC State of the Nations report
Re-imagining growth finance could boost the creative economy and help tackle regional inequality in support of the UK’s Government’ s growth mission.
This new research finds that creative businesses are more likely to identify new R&D opportunities than businesses in other sectors but may face barriers in accessing the capital they need to act upon these.
The report finds that venture capital finance for creative industries firms is heavily concentrated in London and the South East – with 63% of all investments made in these two regions, compared for example with 11% in the North of England, 5% in the East of England, 6% in the South West, 5% in Scotland, and just 2% in Wales and Northern Ireland.
These trends have persisted over time. The research also found that investments tend to be directed towards firms within ‘creative clusters’ with 92% of all investments made in the 55 clusters identified by the Department for Digital, Culture, Media and Sport in 2022. This indicates a need for place-specific business support to ensure creative firms are investment ready.
Professor Hasan Bakhshi, Director, Creative PEC says:
“This report from the Creative PEC confirms for the first time what we have long suspected, namely that there is little venture capital investment in the creative industries outside IT, software and computer services, and what little there is, is predominantly in creative businesses based in London and the South East. Where does this leave businesses in areas like film, TV and radio in, say the Midlands or the North of England, which otherwise have a high potential to grow? Policymakers are right to identify access to growth finance as a priority for creative industries policy support, but developing policies is impossible without detailed data on investment trends. There are few other areas where systematic reporting over time is more vital.”
State of the Nations
The Creative PEC’s ‘State of the Nations’ series analyses the latest data across four thematic areas to inform the development of policies relating to the creative industries. Their scope is the whole of the United Kingdom, and wherever possible data is presented for all the nations and regions. Regular reports on each area will be published biannually over the five yours of the Arts and Humanities Research Council (AHRC) funding. The themes and corresponding Research Consortium Partners are:
R&D, Innovation and Clusters (University of Sussex)
Internationalisation (Newcastle University)
Arts, Culture and Heritage (University of Sheffield)
Education, Skills and Talents (Work Advance)
The report’s lead author is Dr Josh Siepel (University of Sussex and the Creative PEC) alongside Dr Sawan Rathi (University of Sussex) and Marc Cowling (Oxford Brookes University)
The report was designed by Mike Green at Green Doe. Thanks to Creative PEC policy, operations and communications teams for editing, proofing and other support.
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If the information in this report is used in any subsequent research and/or publications, please cite as follows: Siepel, S, Rathi, S and Cowling, M (2024) ‘Growth finance for the creative industries’, Creative PEC State of the Nations Research Series. United Kingdom: Creative Industries Policy and Evidence Centre (Creative PEC). DOI:10.5281/Zenodo.13889750
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Credits
Report design by Mike Green/Green Doe Ltd
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