Financial sector ‘short-termism’ restricting North West growth, says report

A culture of short-termism in the financial sector is limiting growth among the North West’s tech businesses, a new report has claimed.

The North West Ambitions report, published by commercial law firm Brabners, says that growth is being held back by an overly risk-averse financial sector that focuses too much on short-term returns.

Brabners’ Nik White commented: “The government has set out its ambition to ensure the digital economy is at the forefront of the Northern Powerhouse and, while there’s no doubting the opportunity, it’s clear that early-stage businesses feel they are facing some significant barriers – not least a digital skills shortage.

“The region must carve its own niche as an alternative to London in order to attract and retain the digital talent these businesses need.”

In the report, Mark Barlow, the CEO of Manchester tech firm AppLearn, said investors and banks need to be encouraged to look more at business’ long-term growth prospects.

He continued: “In America they look for growth and job creation. Financial institutions need to start being patient and fund businesses over a 10-15 year period.

“If they don’t, they are just restricting growth and denying UK companies a fair chance to compete.”

The report, compiled to mark Brabners’ 200th year in operation, is calling for a greater level of support for companies beyond the startup phase and encouraging policymakers to attract more digital talent to the North West by marketing its affordability and quality of life.

Further, it argues that the £1bn Superport initiative in Merseyside presents a greater opportunity for growth in the North West than HS2, and asks for more public sector backing to champion it on a national level as one of the Northern Powerhouse’s key assets.

Brabners’ managing partner, Mark Brandwood, said: “The ascension of the Northern Powerhouse – from slogan, to concept, to policy – is emblematic of a new sense of confidence that has taken root in the North West in recent years.

“As a long term stakeholder in the region, we wanted to bring together key voices on some of the areas of potential that, if exploited, can help to rebalance the UK economy.

He continued: “Within the report we have highlighted actionable points that, alongside a more balanced approach to public sector infrastructure spending can help to turn the concept of a regional powerhouse into reality.

“It is imperative that businesses and policyholders collaborate to see the region’s true potential come to fruition.”