A new report published today by the AHRC-funded Creative Industries Policy and Evidence Centre (Creative PEC) says re-imagining growth finance could boost the creative economy and help tackle regional inequality in support of the UK Government’s growth mission. The report is part of the Creative PEC’s ‘State of the Nations’ series which provides regular reporting on creative economy trends to support robust policymaking. The research was led by Dr Josh Siepel at the University of Sussex Business School.
The new government has committed to supporting growth of the UK’s creative industries with the sector featuring prominently during the Labour Party Conference and referenced not only by the Secretary of State but also during the Prime Minister’s keynote speech. Today’s new research presents practical ways in which creative industries could contribute to the growth mission.
The report 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.”
The report highlights that 73% of creative industries firms say they want to grow (Creative Industries Council 2017) and can identify investment opportunities but according need sector and place-based specific business support to become ‘investment ready’.
Dr. Josh Siepel, University of Sussex Business School and Research Lead (R&D, Innovation and Clusters, Creative PEC) says:
“This research shows the importance of ensuring that creative businesses have the understanding and skills to receive investment. Supporting investment readiness in creative businesses can help to build demand for capital, eventually bridging the UK’s regional inequalities. At the same time, the creative industries will benefit from closer linkages with financial services providers, helping to drive innovation and new forms of finance that can unlock growth for creative sectors and businesses.”
The report findings will be explored during an online event at 12 noon UK time on Wednesday 16 October with Caroline Norbury, CEO, Creative UK invited to deliver an expert response on the implications for creative firms and government policy.
Caroline Norbury, CEO, Creative UK Said:
“This report highlights the urgent need for tailored investment solutions that unlock the potential of the UK’s creative businesses, especially through fostering an inclusive approach to growth which ensures that the right types of funding are available at the right time no matter where an organisation is in the country.
Creative UK is proud that working with Creative PEC we are overhauling the evidence base about the needs of organisations across the cultural and creative industries when it comes to funding, finance and a fragmented investment framework. Together, we can ensure that the creative sector drives socio-economic growth and tackles inequalities too.”
/ENDS
Download the report: https://pec.ac.uk/state_of_the_nation/growth-finance-for-the-creative-industries/
(live from 00.01 Wednesday 16 October 2024, UK time)
The report Growth Finance for Creative Industries is published by the Creative Industries Policy and Evidence Centre, which is led by Newcastle University with the Royal Society of Arts and funded by the UKRI Arts and Humanities Research Council (AHRC).
The report authors are Josh Siepel (University of Sussex and Creative PEC), Sawan Rathi (University of Sussex and Creative PEC) and Marc Cowling (Oxford Brookes University)
The research team and spokespeople for the Creative PEC are available for comment and interview.
Press contacts
Alice Kent alice.kent@pec.ac.uk (Monday-Wednesday) and Sarah Abley (Wednesday – Friday) sarah.abley@pec.ac.uk
Notes to editors
1. State of the Nations reports
The report is the fifth in the Creative PEC’s new ‘State of the Nations’ series, which uses the latest data to inform policymakers on how best to support the creative sector across four thematic areas. Regular reports on each area will be published annually over the five years of the Arts and Humanities Research Council (AHRC) funding period.
2. About the Creative Industries Policy and Evidence Centre (Creative PEC)
Creative PEC works to support growth of the UK’s Creative Industries through the production of independent and authoritative evidence and policy advice. Led by Newcastle University with the Royal Society of Arts and funded by the UKRI Arts and Humanities Research Council, the Centre comprises a core consortium of; Newcastle University, Work Advance, Sussex University and the University of Sheffield. The PEC works with a diverse range of industry partners.
For more details, visit http://www.pec.ac.uk and @CreativePEC
3. About The Arts and Humanities Research Council
The Arts and Humanities Research Council (AHRC), part of UK Research and Innovation, funds internationally outstanding independent researchers across the whole range of the arts and humanities: history, archaeology, digital content, philosophy, languages and literature, design, heritage, area studies, the creative and performing arts, and much more. The quality and range of research supported by AHRC works for the good of UK society and culture and contributes both to UK economic success and to the culture and welfare of societies across the globe.
4. ‘Growth Finance in Creative Industries’ was designed by Mike Green at Green Doe Graphic Design.
