Spotlight on investment opportunities of high-growth creative businesses

Government and industry moves to tackle barriers for creative businesses in raising finance and new research into the high-growth potential of creative firms have shone a spotlight on the untapped investment potential of the creative industries.

New data showing almost 10 per cent of UK companies classified as having high-growth potential are in the creative industries – a higher share of high growth firms than that accounted for by the life sciences or advance manufacturing sectors – provides the background for announcements designed to unlock investment and support future growth in the creative industries.

To coincide with the Big Creative UK Investment Summit event and as the latest stage in delivery of the Creative Industries Sector Plan, announcements included:

• The British Business Bank (BBB) is significantly increasing its backing for the creative industries as part of its £4bn investment into sectors identified as growth priorities under the UK's Industrial Strategy
• A £45 million cornerstone investment by the BBB into Redrice Ventures, a specialist seed-stage investor across the creative industries.
• A partnership with the Intellectual Property Office to expand intellectual property-backed lending for creative firms.
• The BBB will convene key sector stakeholders – including small creative business owners, finance providers, public finance institutions and the Creative Industries Council – to understand the sector’s investment opportunities.

In addition, to help businesses navigate their investment options, Creative UK will launch a new ‘single frontdoor’ service in 2026, offering clear guidance on accessing finance and improved signposting and support from the Business Growth Service and the British Business Bank’s Finance Hub.

The Department for Culture, Media and Sport is also publishing new resources including a map of finance available to the sector, and case studies of successful creative scale-ups.

Additional Work is ongoing by the Office for Investment and the Department for Business and Trade (DBT) to identify and deliver strategic investments, and connect UK businesses to international finance and global markets, in order to attract funding to the UK and expand the capability of promising creative industries. DBT, industry and Government partners are also continuing to attract international investors to the UK, to showcase innovative creative businesses through its export missions and at key global trade events.

The UK’s creative industries are a success story. Recently published official statistics shows they contributed £145.8 billion in gross value added (GVA) in 2024, growing at four times the rate of the wider economy between 2023 and 2024.

Creative Industries Minister Ian Murray said: “The UK’s creative industries are world-class, with businesses at the cutting edge of their fields existing right across the country.

"Through the Creative Industries Sector Plan, we are determined to ensure they can continue to grow. Accessing finance is key to that, which is why we are working with industry to open up more opportunities.”

Caroline Norbury OBE, Chief Executive of Creative UK, said: "Creative UK has long advocated for more investment into the creative industries. This increased support from the British Business Bank is an important step forward for the sector."

The scale of investment opportunties in fast-growing creative companies is outlined in a new report, by the Creative Industries Policy and Evidence Centre (Creative PEC) in partnership with Beauhurst, a leading source of data on businesses.

The research quantifies outlines the size of the investment opportunity not only in areas such as application software, where scalable models have attracted equity investors, but also in areas like advertising, films and TV, video content and video games, where considerable numbers of creative industries firms report high-growth performance.

The Creative PEC/Beauhurst research estimates that almost 10 per cent of firms in the creative industries are 'High Growth Potential Firms', compared to 5.1 per cent of firms in life sciences and 2.4 per cent of advanced manufacturing companies.

However, between 2021 and 2024 there was a bigger drop (-16.5 per cent) in the number of equity deals involving High Growth Potential Firms in the creative industries, compared to the drop in the number of equity deals in life sciences (-6 per cent ) and advanced manufacturing (-14 per cent) during the same period.

In addition, previous research by Creative PEC estimates there may be as much as £1.4bn of unmet demand for equity funding in the creative industries.

Compared to business in other sectors, creative businesses can also face bigger obstacles in raising debt capital as lenders can prove less willing to accept intellectual property and other forms of intangible assets as collateral.

The Government announcements and the research are part of ongoing work to identify and reduce the barriers to raising finance among creative business and highlight the untapped investment opportunities in the creative industries.

Baroness Shriti Vadera, co-chair of the Creative Industries Council said: “This research fills a critical gap in the evidence base, making clear that there are substantial untapped investment opportunities in the UK’s high-growth creative industries - across a wide range, from advertising, films & TV to video games and software.”

Tom Adeyoola, Executive Chair of Innovate UK says: “This is an important report as we aim to drive economic growth and ensure a thriving creative industries sector. This helps us understand who and where the high potential businesses are, the conditions for success and how to target the interventions needed to drive our breakthrough ideas to global greatness.”

Hasan Bakhshi, Director Creative PEC and report co-author said: “There are somewhere between 260,000 and 270,000 firms in the UK’s creative industries but not all of them have the same growth potential. Our research estimates that within this population are a vital group of almost 6,000 businesses that have especially high-growth potential.

"Given the UK’s well-known strengths in IT, it won’t be surprising to investors that the majority of these firms operate in software, but less well known will be that as many as two-thirds of creative industries 'High-Growth Potential Firms' working in software work in sub-sectors like advertising, films & TV, video content and video games too.

"This suggests that investors may identify significant new investment opportunities if they include the creative industries within the scope of their prospecting activities. growth-focused policymakers for their part should consider the needs of High-Growth Potential creative industries firms in their regions."

More at www.gov.uk

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