J.P. Morgan Private Bank releases results of first-ever Top 200 Female-Powered Businesses report
J.P. Morgan Private Bank today released the results of its first-ever Top 200 Female-Powered Businesses report analysing opportunities and challenges for UK women in businesses.
The report, commissioned in partnership with Beauhurst, takes a broader approach to considering the role of women in business, captures a more diverse group of companies and tells a richer story than focusing solely on female-founded firms. It reveals that high-growth, female-powered businesses raised a record £2.3bn in equity investment in 2020, up 41% from 2019.
These businesses are playing an important role in emerging industries, with female-powered businesses driving innovation in preventative care, the sharing economy, pop-up shops and health and fitness insight devices.
However, the report also reveals that for the first time in nine years female-powered companies saw a 27% decline in seed-stage equity deals compared to the previous year.
Oliver Gregson, head of UK & Ireland for the J.P. Morgan Private Bank said: “We commissioned this report as a result of a focus on best advising our female clients. Along the way, we determined a need to better understand the role women play in UK business and enterprise so that we can become their bank of choice. It’s no surprise that 2020 brought unique challenges to businesses owned or managed by women in the UK and, whilst last year was a record year for equity investment into female-powered businesses, this is still a fraction of the more than £13bn invested in all UK growth companies last year.”
“We identified that businesses powered by women were disproportionately found in sectors negatively impacted by the pandemic such as the leisure, entertainment and personal service industries. We will use the knowledge and experience we gained through this work and the ongoing partnership with our existing female clients to enhance the services and advice we provide to fuel female ambition and support women in business.”
In 2020, female-powered businesses employed more than 301,000 people and had sales of £34bn illustrating how these businesses are earning and controlling an increasing amount of global wealth. These figures are expected to increase as the overall wealth landscape continues to change across the UK.
Sam Saperstein, J.P. Morgan Chase global head of Women on the Move said: “This ground-breaking report provides a more nuanced understanding of the role women in business and enterprise play – beyond female founders. We analyzed more than 6,000 high-growth, female-powered companies in the UK, nearly 75% of which have not featured in any other major growth lists until now, to best gain insights into ways J.P. Morgan can help these businesses thrive.”
Investment: high-growth female-powered businesses raised a record £2.3 billion in equity investment in 2020 via 939 deals. The amount invested into female-powered enterprises in 2020 was up 41% from 2019 when female-powered businesses raised £1.6 billion via 1,276 deals.
Top sectors by population: firms operating in the business and professional services sector dominate the UK’s population of female-powered businesses with 2,245 companies having some activity in this area. The next most populous sector is technology/IP-based businesses with 1,815 companies followed by industrials with 1,771 businesses.
Sectors by proportion: female-powered businesses account for 42% of the high-growth craft industries sector, the highest proportion of female-powered businesses in any sector. This is followed by personal services where 33% of companies are female-powered and then leisure and entertainment with 24% of high-growth businesses powered by women.
Regions: The distribution of female-powered businesses reflects the density of the wider population of high growth companies. London accounted for the most female-powered businesses with 2,189 headquartered in the city, followed by the South East (751) and Scotland (520). In terms of proportional share, however, Scotland has the largest proportion of female-powered companies – where they make up 22% of the high-growth company population. The North East (20.5%) follows, then London (20%) and Wales (19%). And in terms of proportion of total equity investment by region, female-powered businesses in North Ireland secured the highest proportion at 35% followed by Yorkshire and Humber (26%) and London (18%).
Growth methods: Whilst female-powered companies are similarly likely to raise equity as other high growth companies, they are less likely to receive an innovation grant worth £100k or more. Only 8% of female-powered businesses have received a large innovation grant, compared to 12% of the rest of the high-growth population.
Academic spinouts accounted for 3% of female-powered businesses, while 4% of the remainder of the high-growth population have grown this way. Due to the youthful profile of many female-powered businesses, with a median age of seven years, using an accelerator programme has been an important tool for them (37%) compared to just 19% of the general high-growth population.