In total, BGF backed 44 new businesses and invested £430m across the UK and Ireland in 2023.

BGF’s focus as a minority partner is to provide backing, via capital and expertise, to support companies and management teams to achieve their growth aspirations whilst retaining control. This is particularly important at a time when Scottish businesses are reporting delays to growth projects because of funding challenges, with the cost of doing business named as a key challenge.

In 2023, local investment activities have helped to support acquisitions, new product development, roll-out strategies and succession planning, as well as directly providing working capital and strengthening balance sheets for portfolio companies.

Scottish investments in 2023 have included:

• £4.5m investment in Stellar Omada, a fast-growing Edinburgh-headquartered technology services company;
• £2m investment into STC INSISO, an Aberdeen-headquartered software solutions company;
• and a £8m investment into Trojan Energy, another Aberdeen-headquartered business that has developed and commercialised an innovative ‘flat and flush’ EV charging system for on-street users.

The latter investment was completed alongside the Scottish National Investment Bank as part of a £26m funding round.

Follow-on investments continued to support growth opportunities across the existing Scottish portfolio including a multi-million-pound investment in Scottish Dental Care Group, a national provider of NHS and private dental treatments; and a further £2m investment in MRM Global (re-branded to Hyble), an industry-leading provider of marketing technology to the global drinks and hospitality sector.

BGF also announced five successful exits in Scotland and Northern Ireland during the year at a total value of over £260m, delivering a combined money multiple of 2.3x. The exits included Kick ICT and STATS (UK) Ltd. – the latter being the company’s first investment in Scotland.

BGF invested a total of £16m in STATS between 2012 and 2023, enabling the company to expand its international footprint and invest in people and product. As a result, the business more than quadrupled revenues and generated a very healthy return for stakeholders on exit. The Kick ICT exit was completed in the latter half of 2023, delivering BGF a strong internal rate of return (IRR) of 38%.

Patrick Graham, BGF’s head of Scotland and Northern Ireland, said: “I’m very happy with the performance the team has delivered this year, particularly given the economic backdrop.

“Over the last year, we’ve backed a diverse range of brilliant businesses with both new and follow-on funding packages. At the same time, we secured strong exits from five portfolio companies, delivering us a strong rate of return. The results of our 2023 activity demonstrate not only the success of BGF’s investment model but also the quality within our portfolio.

“In 2024, BGF will continue to help ambitious businesses realise their growth potential. We know that the general market outlook in Scotland, and indeed globally, continues to be challenging. However, despite the wider market picture, we are confident in our pipeline of deals because it is built on established relationships and a deep understanding of the local SME market which continues to show remarkable resilience despite what is thrown at it. The variety of success stories we have had in 2023 underlines this.”

In December 2023, BGF achieved B Corp status, further bolstering its long-standing commitment to creating a positive impact both within the organisation and across the wider economy.