The business Mixed picture Calling the of space Dealmakers world The final frontier delivering quality Lanarkshire steps up for Scottish business among lower numbers to export challenge insider.co.uk

PREDICTIONS SPECIAL: WHAT DOES 2018 HOLD FOR YOUR SECTOR?

DELIVERING ABOVE PAR INVESTMENT PERFORMANCE Paul Atkinson on building an equity business in a financial storm

Vol 34 No.10 December 2017 £4.00

PLUS IS THE INCREASE IN BASE RATE LIKELY TO HELP GROWTH IN THE SCOTTISH ECONOMY? The business Mixed picture Calling the of space Dealmakers world The final frontier delivering quality Lanarkshire steps up for Scottish business among lower numbers to export challenge insider.co.uk

PREDICTIONS SPECIAL: WHAT DOES 2018 HOLD FOR YOUR SECTOR?

DELIVERING ABOVE PAR INVESTMENT PERFORMANCE Paul Atkinson on building an equity business in a financial storm

Vol 34 No.10 December 2017 £4.00

PLUS IS THE INCREASE IN BASE RATE LIKELY TO HELP GROWTH IN THE SCOTTISH ECONOMY?

Agenda

NOOSE OF BREXIT TAKES FOCUS AWAY FROM OTHER VITAL BUSINESS CHALLENGES

Ken Symon’s regular view on business

N AN ARTICLE in this issue (pages 41-43) I try and Brussels for a trading future that is not hugely and sum up where we have come to in the Brexit detrimental to businesses, particularly those who process, trying to separate the ‘wheat’ of lasting contribute to our much-needed export drive. matters of import from the ‘chaff ‘ of ephemeral All of this makes for some even bigger question Iparty political issues. marks than usual as to what lies in the weeks and It is not an easy process in that, for example, in the months ahead so I salute the brave souls who have course of about a week up until the time of writing we stuck their necks out and predicted what the coming have gone from the Government insisting on a date for year holds for different sectors of Scottish business departure set in stone to the gradual fading of that idea (pages 25-33). into the background. From technology to tourism and financial services That will surely be welcomed by all except the most to food and drink they set out their view of what 2018 red in tooth and claw (or should that be blue in tooth holds. We shall see whether their crystal balls have been and claw) Brexiteers. As anyone in business who has in focus. negotiated a deal knows putting a hard deadline on What has long been seen as the quintessential when the deal must be completed merely gives a lever industry of the future is actually here with us today and to the other side to use. producing impressive results for a small but growing number of Scottish companies: the business of space (see feature on pages 35-37). As the article reports, What are the businesses that will feature space has become a sector that has grown markedly in Scotland over the last five or six years – and it still has high in future Insider Top 500 indexes that potential for a lot further growth yet. It is worth pausing to think about the potential have not yet been created? opportunities that other new fields of endeavour hold. What are the businesses that will feature high in future There is an interesting spread of opinion in business Insider Top 500 indexes that have not yet been created? between those who are taking matters pretty much Because if there is one danger of Brexit it is that it in their stride, treating political uncertainties as just will take up too much of the focus of business and another of the business risks they face and those who policymakers’ attention and that not enough will be really are demanding answers now before they make given to both the threats of new technology disrupting investment and staffing decisions that could have far- existing businesses and the opportunities for total new reaching implications. ones or new ways of doing what we have long done in There is a similar spread between those who fear we other ways. really are heading for the economic rocks, to those who As we reported recently on insider.co.uk (‘The 4th think that a deal will – eventually – be worked out that Industrial Revolution, what it is, why it’s called 4IR is pragmatic and gives us all a way forward. There are and what is means for business’) there is a huge range even a few voices – although not that many in Scottish of new technological challenges out there. Everything business – who believe that Brexit will eventually be from artificial intelligence, robotics, the internet of very positive, freeing business from certain bureaucratic things, autonomous vehicles and 3D printing. strictures and allowing trade links with other countries There is a real danger that business focuses too much outside of the EU. on Brexit and not enough on the very real changes that It is to be hoped that a way will be found by the key are coming pretty rapidly down the pipe at a whole politicians and negotiating teams both in Whitehall variety of sectors. ■

contact: [email protected] www.insider.co.uk December 2017 INSIDER 3 ISSUE: DECEMBER 2017 ISSUE

The business Mixed picture Calling the of space Dealmakers The final frontier world delivering quality for Scottish business Lanarkshire steps up among lower numbers to export challenge insider.co.uk

PREDICTIONS SPECIAL: WHAT DOES 2018 HOLD FOR YOUR SECTOR?

DELIVERING ABOVE PAR INVESTMENT PERFORMANCE contents Paul Atkinson on building an equity business in a financial storm

Vol 34 No.10 December 2017 £4.00

PLUS IS THE INCREASE IN BASE RATE LIKELY TO HELP GROWTH IN THE SCOTTISH ECONOMY? COMMENT 3 Agenda: Ken Symon on Brexit and what business might miss because of it 39 Ian Ritchie: On efforts to encourage young people into the software sector 25 REPORTS 18 Big Profile: Paul Atkinson, Par Equity and 35 Taranata Group 25 Predictions for 2018: Sector specialists look at what lies ahead for business and the economy 35 Business of Space: Nascent sector begins to take off 41 Brexit Update: Ken Symon charts where we have come to on Brexit and what it means 45 Q3 Deals Round-up: Deals figures showing fall as political uncertainty causes market to drag 49 Deals tables 55 Regional Report - Lanarkshire: New investments and business wins boost area 55 REGULARS 41 8 Briefing: News and reviews 10 Scotland’s Quoted Companies: Another new listing cheers the markets 12 Vital Statistics: Setting out the numbers that matter for Scotland’s economy 14 Insider Creative: Bringing a Highland creative industry back to life 45

4 INSIDER December 2017 www.insider.co.uk 80

16 Burning Question: Is the increase in base rate likely to help growth in the Scottish economy? 22 Letter To My Younger Self: Graham Suttie sets his 16-year old self right 53 In My View: Richard Mackie on how to avoid ‘doing a Ryanair’ 62 IT Matters: Companies see the benefits of making it mobile 64 International: Building a base in the Asian market 67 Property: Why TMT is fastest growing sector 69 Property News 69 67 76 Wealth Management: Adapting to go back to the future 78 Appointments: Who’s on the move? 79 Personnel: Keeping an eye on employees’ digital interaction 80 Slainte: Events, people and parties 82 Ten Minute Interview: Michelle Lownie, 64 Eden Scott 82 EVENTS 71 Made In Scotland Awards: Entries open for the awards to celebrate the best of Scottish manufacturing 72 Accountancy Awards: A peek back at what’s happening with last year’s winners 73 SME Awards: The successes of some of the contenders for the 2018 awards 74 Top 500 Breakfast: Keynote speakers announced for 2018 event 7979 62

www.insider.co.uk December 2017 INSIDER 5 COMMENT Good Business: Profit from being exit ready SCOTTISH BUSINESS INSIDER One Central Quay, Glasgow G3 8DA Switchboard: 07795 364732 Aileen is a Partner and Head Fax: 0141 309 3545 ISSN: 0952-1488 of Tax Consultancy Group for Scotland Publisher Design & Allan Rennie production Tel: 0141 309 3413 Ewan Lauder Tel: 0141 309 3673 Director – events & business Lorna Beattie Aileen Gates Michele Aaen Tel: 0141 309 1463 Tel: 07769 935583 E-mail: [email protected] Advertising Selling a business successfully sales process starts, thus Group head - advertising Editorial Eleanor Hunt can be a major challenge. A preserving value, simplifying Editor Tel: 07788 168 576 good exit can be significantly the sale and presenting the Ken Symon E: [email protected] more profitable and be a business as well managed Tel: 0141 309 3339/07769 164698 E-mail: [email protected]/ Field sales executive memorable and rewarding and controlled. The review [email protected] Steve Georgiou Tel: 07825 853232 experience. To ensure the should also consider the Reporter E: [email protected] best value from the deal, exit availability of any tax assets Kristy Dorsey readiness must be planned at (e.g. tax losses, R&D tax relief Tel: 0141 3093065/ 07717 680386 E-mail: [email protected] Events an early stage, and at least a or capital allowances) which Events operations manager full year before any potential may increase the value of the Sub-editor Lisa Lynas Tel: 0141 309 3095 sale. company. Mark Lane Tel: 07841 285529 [email protected] Early planning is vital to A tax efficient structure is E: [email protected] Key account manager – events allow an action plan that important and it is common Insider business bulletin Aileen Turnbull will ensure the business is to find holding structures Scott McCulloch Tel: 0141 309 4909 as attractive commercial which create multiple layers Tel: 07789 397551 E: [email protected] E: scott.mcculloch01@ Head of new business sales - Events proposition. Tax is normally a of tax when returning sales trinitymirror.com significant issue. For example, proceeds to the ultimate Caroline Miller Researcher Tel: 0141 309 3133 the business’s own position owners. Early action can allow Steven Wilson E: [email protected] can affect the price that a for restructuring to avoid Tel: 0141 309 3338 purchaser is willing to pay for unnecessary tax charges. E: [email protected] it; whilst the holding structure Maximum advantage and availability of tax reliefs should be taken of tax reliefs, Total Circulation 11,394 Average net circulation: 7,394 (July 1, 2016-June 30, 2017) can affect the amount of such as Entrepreneurs’ Relief. Plus other bulk distribution: 3000 copies to selected UK first class rail lounges. 1000 tax that must be paid by the It is essential to satisfy the copies to selected UK airport lounges. 3200 downloads of the Insider App product sellers on the price. conditions relating to the (Android and Apple stores). Subscriptions 1yr: £32 2yr: £64 3yr: £92 Often, an exit involves owner, the shareholding and/ Overseas yr: £58 (Airmail Europe) £65 (Airmail USA) the purchaser researching or the company’s tax status Enquiries on subscriptions/back issues Tel: 0141 309 3693 the company’s affairs. It will to make any tax savings, E-mail: [email protected] typically engage professional which typically must be met Enquiries on Top500 and SME300 databases Tel: 07795 364732 advisers to carry out due throughout the year prior to E-mail: [email protected]/[email protected] diligence on key areas, sale. And if the sales process is © Insider Publications Ltd. No reproduction is permitted in whole or part including tax. Any issues may deferred or aborted, value can without the express consent of Insider Publications Ltd. affect the sale value until the be lost if there are economic matter is resolved with the or policy changes. SUBSCRIBE TO SCOTLAND’S tax authorities. Normally, the A good exit should be a LEADING BUSINESS MAGAZINE sellers will also have to give profitable, rewarding exit Since 1984, Insider has been publishing in depth business information. warranties and indemnities and a well thought out To keep yourself up to date with the latest business intelligence for against liabilities arising after exit readiness plan gives only £32.00 per year contact us on 0141 309 4906 or fill in the sale has completed. the business and owners the form below and send it to us at: An early review will help maximum flexibility and Insider, 1 Central Quay, Glasgow, G3 8DA identify and resolve any choice on how to engineer such matters before the the best deal. Name

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NEWS: BRIEFING News and quotes compiled by Ken Symon and Scott McCulloch

IN BRIEF Enterprise Ireland states case for easier trade

Firm joins major IRELAND wants as few barriers business network to exist for trade between their businesses and Scotland and WRIGHT, Johnston & Mackenzie the UK after Brexit as possible, LLP has joined one of the world’s according to Kevin Sherry, largest networks of lawyers, executive director of Enterprise accountants and tax advisors. Ireland. WJM will be the only Scottish law firm in the Geneva Group He said: “From Enterprise International, an alliance of Ireland’s perspective and from professional services firms with Ireland’s perspective the fewer more than 560 members across barriers that exist between the world. Ireland and Scotland the better. Fraser Gillies, WJM’s It’s better for trade in both managing partner said: “We’re directions, better for jobs.” position than that.” UK amounts to about one billion delighted to have joined Asked about the possibility On a visit to Edinburgh to euros a week and there is a total such a high quality network of a ‘hard Brexit’ he said: “From encourage trading links between of 400,000 employed in the two of professional services firms our perspective what we would business in the two countries countries that are dependent on across the world. It was clear like to see ideally is a position he said that he saw increased that trade. to us that the member firms where the trade barriers between partnerships between Irish and In 2016 the value of Irish have a similar outlook to us and our two countries are as low as Scottish companies and sectors exports to the UK was 7.5bn share our focus on developing rewarding and long-term client possible which enables the strong “as a means of dealing with some euros, an increase on 13 per cent relationships with their clients. continuation of trade in both of the issues that will arise from for Scotland from the year before. “Our membership allows us directions. We see that as being dealing with Brexit”. He said that the UK is the to offer genuine international good for companies, good for He said that there are number one export market for capability to our clients whilst jobs in both economies.” close cultural links and close Irish companies with about maintaining our independence Enterprise Ireland is a natural ties between Ireland 35 per cent of the exports and Scottish focus. We think government agency which is and Scotland and that extends of Enterprise Ireland client being able to offer access to semi-independent with its own into very strong business links companies and he sees that this network to our clients who board and which has a focus on between the two countries. continuing Brexit or no Brexit. increasingly are looking beyond helping companies in Ireland to Enterprise Ireland works closely Important sectors are food and Scotland in their personal and start up, innovate and scale up; with Scottish Enterprise on a drink, construction engineering, business lives is likely to be well and on inward investment into range of issues regarding trade clean tech, renewable energy, received. As the sole Scottish firm in the alliance we expect to Ireland. between the two countries. water, power, financial services be well placed to benefit from Sherry said: “We’re talking and There are just over 1500 and agritech. A new trade referrals in to Scotland from advising any client companies countries that are exporting network to foster business links clients looking to invest.” of ours to prepare for any from Ireland to the UK or have between the two countries, the WJM has 28 partners, 55 type of Brexit – so prepare for a presence in the UK. Those Irish Business Network Scotland, fee earners and 50 employees eventualities that may occur companies between them employ was launched in the summer. across its four offices in Glasgow, whether that be a situation 100,000 directly and over 100,000 For more on the big Brexit Edinburgh, Inverness and where WTO tariffs do apply indirectly. issues, see our special feature on Dunblane. or hopefully for a much better Trade between Ireland and the pages 41-43. Cairn launches new programme Olly Dmitriev named in inspiring 100 list Cairn Group, the leisure OLLY Dmitriev, the founder driving cultural change. working hard to push forward operator, has launched a new and CEO of Edinburgh-based Dmitriev invented the innovation. national training programme Vert Rotors, has been named in world’s smallest low-vibration “Being included beside some creating apprenticeships a list of the 100 most inspiring compressors for a range of of the biggest names in the UK and career development individuals in the manufacturing applications including space and manufacturing scene in the Top opportunities in Scotland. sector. terrestrial applications. 100 list is a great honour and The Cairn Academy offers The list, now in its fourth year, He was named Inventor of recognises the success we have apprenticeships across is selected by a team of industry the Year in Insider’s Made In had in 2017. the group’s UK-wide hotel experts in recognition of the Scotland Awards 2017. “Our focus on developing portfolio for people at varying dedication of those who have Dmitriev said: “It has been stages in their careers, along technology that can support with focused training on significantly contributed to the an exciting year for Vert work in the most delicate and management and leadership manufacturing sector in the Rotors as we have introduced situation critical industries is progression. An initial cohort previous 12 months. new products, enhanced our being increasingly recognised. of 43 employees have been Criteria nominees are judged manufacturing process and From space to medical treatment, enrolled across hotels including against includes leadership, grown the team. We have a great our micro-compressors are play a a number in Scotland. investment in new markets and team of experienced engineers vital role in a variety of sectors.” 8 INSIDER December 2017 www.insider.co.uk NEWS: BRIEFING

Councillors visit key Cities Deal bid projects IN BRIEF LOCAL representatives have been pleased to say that the potential examining key projects that form for Angus and the region generally Property awards part of the Tayside Cities Deal bid. is substantial. We are working judge praises Councillors (pictured right) closely together to make sure we achievements who represent the Dundee, Perth get the best deal possible.” & Kinross and Angus Councils Councillor Alexander said: JUDGING has taken place in the visited the James Hutton Institute “It’s essential that we get out and Scottish Property Awards which in Invergowrie in early November see these ambitious projects in celebrate achievements in the to explore the potential benefits the flesh, to better understand commercial property sector. of the Advanced Plant Growth their local impact but also to The judging panel met on 15 November to review and project there. Project which is seeking funding understand the potential for decide on what they described Councillors John Alexander of to develop an academic and economic and job growth. as a very strong set of entries Dundee, Bob Myles from Angus commercial test bed for the future Councillor Campbell said: in the fifth year of the awards and Ian Campbell of Perth & development of the industry. “Our region has considerable programme. Kinross visited the agri-science It will aim to develop expertise to offer with which The 2018 awards, which are research institute and Perth sustainable and innovative to create a smarter and fairer presented at an awards dinner College, part of the University of solutions with global potential to Angus, Dundee, Fife and Perth & on 1 March at the Glasgow the Highlands and Islands (UHI). the current and future challenges Kinross and these projects amply Hilton Hotel, have seen the At the James Hutton Institute faced in the agricultural sector. demonstrate that. The visits today highest number of entries to the group toured the new facility Councillor Myles said: “There have reinforced my view that this date. under construction and learned is so much in the deal bid for the region can deliver something very In particular, the judging more about the Advanced Growth people of the region and I am exciting.” panel reviewed a record number of entries specifically in Development of the Year (public buildings) with Unique events venue opens for business 15 developments being considered. BUSINESS owners Duncan and The £1.9m investment was Fiona Morton, the former Vicki McConchie have opened supported by Scottish Enterprise managing partner and CG’s Yard, a £1.9m wedding and and Dumfries & Galloway chairman of Ryden, chaired events business based at Laggan Council. the judging panel. Her fellow Outdoor in Gatehouse on Fleet, The coastal events venue was judges included Andrew Dumfries and Galloway. previously a 250-year-old farm Sutherland, joint managing The new venue is unlike any steading which spans 1100 square director, Miller Developments; existing facility in the area and is metres. The McConchie family Miller Mathieson, executive projected to add millions into the have farmed the 1,100 acres of director, CBRE; Martin Perry, South West of Scotland economy land at Laggan for 106 years and director of development, TH Real Estate; David Shearer, with more than 60 wedding have already booked include ones currently four generations live on managing director of HFD bookings having already been from Australia and New Zealand. site. Construction Group; and made at CG’s Yard. One local hotel has already Paula Ward, regional director of Beverly Smith, a manager at The venue took 18 month to expanded and a number of VisitScotland, said: “The opening Moray Council. complete, meaning bookings to bed and breakfasts have been of this unique events space is an Fiona Morton said: “The date have been been based on opened up on the back of the exciting addition to the business Scottish Property Awards conceptual designs. Couples that development. market in Dumfries & Galloway.” celebrates the best of Scotland’s commercial built environment and we are looking forward to announcing finalists in what is QUOTE UNQUOTE Book Review shaping up to be our biggest competition yet. “Winter is coming, Title: The Inspired Leader “Thank you to all the and the board of Writer: Andy Bird businesses which have Publisher: Bloomsbury participated so far, it is Johnston Press are Price: £14.99 immensely rewarding reading still sunbathing, If you are finding the run up to the end Henley Business School, it hashas much much about so many outstanding sipping pina coladas of the year a real slog after a tough 12 of interest to say on areas such as core achievements across the and tripping over months then this is the book for you. motivation and embracing challenging country.” Written by leadership consultant Andy experiences. The annual celebration, their flip flops on Bird, it looks at what touches us and The section on maintaining inspiration which regularly attracts in the the beach” inspires us as leaders. and sources of resilience is particularly region of 800 guests, will bring Partly based on research from the insightful. together the breadth of the Christen Ager-Hanssen, industry including developers, rebel shareholder funders, architects, councils, agents, professional advisors Rating out of five: ★★★★ and contractors. www.insider.co.uk December 2017 INSIDER 9 SHARES: SCOTLAND’S QUOTED COMPANIES

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Some bad results mitigated by new Beeks listing on AIM Ken Symon’s regular digest of Scottish stock performance

S WE TAKE our last look at Scotland’s The company seeing the biggest proportional quoted companies for the year we Biggest risers fall in its share price was oil and gas engineering are again cheered by news of another NAME % CHANGE 1 MTH and services business Plexus Holdings whose planned listing – and this time from the CALEDONIAN TRUST PLC 15.63 shares took a 20 per cent hit. This followed a Amuch talked about fintech sector. CAIRN ENERGY PLC 12.89 general meeting of shareholders on 6 November Beeks Financial Cloud, the Paisley-based MACFARLANE GROUP PLC 10.29 where the decision was made to sell its rental company which provides niche cloud computing AGGREKO PLC 7.31 wellhead for jack-up applications business to FMC services for automated trading in Futures and FAROE PETROLEUM PLC 7.14 Technologies, a subsidiary of leading oil and gas CRANEWARE PLC 6.45 Forex financial products, is due to have joined JOHN WOOD GROUP PLC 4.91 services and equipment company TechnipFM. the AIM index by the time that you read this. SMART METERING SYSTEMS PLC 3.19 The Aim-listed company said that the disposal, It planned to raise £7m from the market in a STAGECOACH GROUP PLC 3.13 which was backed by 99.8 per cent of shareholders, move that would have given the group a market PARKMEAD GROUP PLC 2.78 was in line with its strategy of focusing on capitalisation of £24.5m. increasing industry awareness of its POS-GRIP Beeks, which launched in 2011, said its platform friction grip technology. “provides ‘on demand’ low latency computing Biggest fallers As part of the transaction a Plexus subsidiary resources to its clients through its direct NAME % CHANGE 1 MTH and FMC have entered in to a collaboration connectivity to the leading financial exchanges agreement to work together on the development of PLEXUS HOLDINGS PLC 20.00 across the world”. OMEGA DIAGNOSTICS GROUP PLC 13.04 existing POS-GRIP applications outside of jack-up Its clients include about 165 financial MINOAN GROUP PLC 12.50 exploration as well as for future new technologies. institutions and more than 6,000 direct/indirect INDIGOVISION GROUP PLC 10.29 Omega Diagnostics Group, the Alva-based Virtual Private Server clients globally on an ‘on STV GROUP PLC 7.84 medical diagnostics business, was the second demand’ or ‘pay for what you use’ model. BRAVEHEART INVESTMENT GROUP PLC 6.25 biggest faller with a 13 per cent drop in its share Revenues for the 2017 year to June rose to £4m, SCOTGOLD RESOURCES LIMITED 5.26 price. up from £2.7m in 2016. STANDARD LIFE PLC 4.84 This followed a trading update in which the The company said the fundraising will provide QUIZ PLC 4.78 Aim-listed company said that it expected turnover an “opportunity to accelerate organic growth PRODUCE INVESTMENTS PLC 4.74 to be £7.11m in line with last year’s first half in through acquisitions in a fragmented marketplace” constant currency terms and four per cent ahead having added two acquisitions to date. of last year’s turnover of £6.83m. The figures reflect If the listing has gone ahead it will be the fourth the fall in sterling following the UK vote to leave IPO from a Scottish company within a 12-month Beeks said its the European Union. period. Springfield Properties joined AIM in The company said it sees strong growth October while Glasgow-based fashion business platform “provides ‘on in North America with its food intolerance Quiz joined in September and FreeAgent in business but revenue in its allergy/autoimmune November 2016. demand’ low latency product line in Germany declined by 8.5 per The news cheered up a performance which saw cent compared to the previous year. In infectious 23 companies reporting a falling share price while computing resources diseases, a small percentage increase in revenue in there were 15 risers and seven seeing their share actual terms had been positively impacted by the prices unchanged. to its clients through weaker position of sterling. Cairn Energy saw a near 13 per cent rise in its David Evans, chairman of Omega, said: “We share price on the back of positive news on the its direct connectivity continue to advance as a company in all our key Catcher Field in the North Sea which is operated areas and the outlook over the next twelve to by Premier Oil and in which Cairn has a 20 per WRWKHOHDGLQJğQDQFLDO eighteen months remains positive - the shorter- cent interest. The main market listed, Edinburgh- exchanges across the term is dominated by factors not wholly within based oil exploration and production company our control. We continue to be enthusiastic about said that delivery of the first oil from the field world” prospects for Omega and we hope to announce remains on schedule for the end of the year. further progress later in the year.” ■ 10 INSIDER December 2017 www.insider.co.uk SHARES: SCOTLAND’S QUOTED COMPANIES

Main Market

LIST MARKET* SHARE PRICES DATE VALUE (£m)SECTOR 5 YEARS AGO 1 YEAR AGO LAST MONTH THIS MONTH % CHANGE A.G. BARR PLC 2/4/1970 719.73 SOFT DRINKS 502.00 475.00 623.00 620.00 -0.48 AGGREKO PLC 29/9/1997 2442.18 BUSINESS SUPPORT SERVICES 2345.00 818.00 889.00 954.00 7.31 ALLIANCE TRUST PLC 17/7/1947 2586.76 INVESTMENT TRUSTS 375.00 580.00 738.00 741.00 0.41 CAIRN ENERGY PLC 22/12/1988 1274.37 EXPLORATION AND PROD. 269.00 209.00 194.00 219.00 12.89 CLYDESDALE BANK CYBG 3/2/2016 2797.59 BANKS N/A 282.10 312.10 312.50 0.13 DEVRO PLC 30/6/1993 389.41 FOOD PRODUCTS 307.00 140.00 241.00 233.00 -3.32 ENERGY ASSETS GROUP PLC 22/3/2012 203.03 BUSINESS SUPPORT SERVICES 210.00 N/A N/A N/A N/A EXOVA GROUP PLC 11/4/2014 597.42 BUSINESS SUPPORT SERVICES N/A 190.00 240.00 238.00 -0.83 FIRSTGROUP PLC 16/6/1995 1320.36 TRAVEL AND TOURISM 187.00 102.00 108.00 109.00 0.93 J SMART & CO CONTRACTORS PLC 25/3/1973 47.26 REAL ESTATE HOLD, DEV 79.00 106.00 111.00 106.00 -4.50 JOHN MENZIES PLC 3/10/1962 585.67 BUSINESS SUPPORT SERVICES 601.00 525.00 703.00 702.00 -0.14 JOHN WOOD GROUP PLC 5/6/2002 4926.80 OIL EQUIP. & SERVICES 777.00 823.00 693.00 727.00 4.91 JOHNSTON PRESS PLC 29/4/1988 16.15 PUBLISHING 675.00 14.00 15.00 15.00 0.00 MACFARLANE GROUP PLC 20/6/1973 117.77 BUSINESS SUPPORT SERVICES 25.00 58.00 68.00 75.00 10.29 ROYAL BANK OF SCOTLAND GROUP PLC 10/7/1968 32740.65 BANKS 295.00 194.00 280.00 274.00 -2.14 SSE PLC 18/6/1991 14241.61 ELECTRICITY 1425.00 1475.00 1392.00 1394.00 0.14 STAGECOACH GROUP PLC 19/10/1998 948.31 TRAVEL AND TOURISM 293.00 204.00 160.00 165.00 3.13 STANDARD LIFE PLC 10/7/2006 12296.57 LIFE INSURANCE 391.00 346.00 434.00 413.00 -4.84 STV GROUP PLC 25/3/1973 126.76 BROADCAST AND ENTERTAIN 102.00 348.00 357.00 329.00 -7.84 WEIR GROUP PLC 25/1/1946 4441.74 INDUSTRIAL MACHINERY 1890.00 1808.00 2024.00 1981.00 -2.12

Alternative Investment Market

LIST MARKET* SHARE PRICES DATE VALUE (£m)SECTOR 5 YEARS AGO 1 YEAR AGO LAST MONTH THIS MONTH % CHANGE BOWLEVEN PLC 7/12/2004 100.92 EXPLORATION AND PRODUCTION 71.00 25.00 31.00 31.00 0.00 BRAVEHEART INVESTMENT GROUP PLC 30/3/2007 4.03 EQUITY INVESTMENT INSTRUMENTS 15.00 12.00 16.00 15.00 -6.25 CALEDONIAN TRUST PLC 29/9/1995 17.38 REAL ESTATE HOLD, DEV N/A 90.00 128.00 148.00 15.63 CORETX HOLDINGS PLC 30/6/2010 59.72 INDIVIDUAL AND FAMILY SOCIAL SERVICES 184.00 32.00 30.00 30.00 0.00 CELTIC PLC 22/12/2005 122.21 RECREATIONAL SERVICES 38.00 71.00 131.00 131.00 0.00 CRANEWARE PLC 13/9/2007 400.38 SOFTWARE 465.00 1025.00 1395.00 1485.00 6.45 ELAND OIL & GAS 3/9/2012 141.46 OIL AND GAS PRODUCERS 118.00 37.00 66.00 64.00 -3.03 FAROE PETROLEUM PLC 27/6/2003 383.11 EXPLORATION AND PRODUCTION 137.00 75.00 98.00 105.00 7.14 FREEAGENT HOLDINGS PLC 16/11/2016 31.55 ACCOUNTING SOFTWARE PROVIDER N/A 78.00 76.00 77.50 1.97 FRONTIER IP GROUP PLC 31/1/2011 18.76 SUPPORT SERVICES 14.00 33.00 49.00 49.00 0.00 GOALS SOCCER CENTRES PLC 7/12/2004 68.07 RECREATIONAL SERVICES 124.00 94.00 93.00 91.00 -2.15 HAVELOCK EUROPA PLC 1/10/1987 2.60 FURNISHINGS 12.00 9.00 6.00 6.00 0.00 INDIGOVISION GROUP PLC 2/8/2000 11.81 COMPUTER SERVICES 374.00 156.00 175.00 157.00 -10.29 IOMART GROUP PLC 19/4/2000 381.44 INTERNET 197.00 284.00 370.00 354.00 -4.32 LANSDOWNE OIL & GAS PLC 21/4/2006 4.72 EXPLORATION AND PRODUCTION 52.00 1.00 1.00 1.00 0.00 MINOAN GROUP PLC 18/10/2011 15.65 TRAVEL AND LEISURE 8.00 7.00 8.00 7.00 -12.50 MURGITROYD GROUP PLC 30/11/2001 42.28 BUSINESS SUPPORT SERVICES 455.00 510.00 475.00 470.00 -1.05 OMEGA DIAGNOSTICS GROUP PLC 18/3/2004 25.07 MEDICAL SUPPLIES 14.00 18.00 23.00 20.00 -13.04 PARKMEAD GROUP PLC THE 13/3/2000 36.11 EXPLORATION AND PRODUCTION 203.00 55.00 36.00 37.00 2.78 PLEXUS HOLDINGS PLC 9/12/2005 67.45 OIL EQUIPMENT AND SERVICES 240.00 65.00 80.00 64.00 -20.00 PRODUCE INVESTMENTS PLC 18/10/2010 47.25 FOOD PRODUCERS 148.00 149.00 190.00 181.00 -4.74 QUIZ PLC 28/7/2017 192.56 FAST FASHION BRAND N/A N/A 169.75 161.63 -4.78 SCOTGOLD RESOURCES LIMITED 15/1/2008 4.30 PRECIOUS METALS AND MINERALS 387.50 60.00 28.50 27.00 -5.26 SIGMA CAPITAL GROUP PLC 27/4/2000 74.52 ASSET MANAGERS 6.00 80.00 85.00 84.00 -1.18 SMART METERING SYSTEMS PLC 8/7/2011 726.94 BUSINESS SUPPORT SERVICES 247.00 532.00 783.00 808.00 3.19 SPACEANDPEOPLE PLC 31/12/2004 6.15 MEDIA AGENCIES 81.00 22.00 33.00 32.00 -3.03 SPRINGFIELD PROPERTIES 16/10/2017 95.42 HOME CONSTRUCTION N/A N/A N/A 112.50 N/A

*Figures to close of market Thursday, November 9, 2017 www.insider.co.uk December 2017 INSIDER 11 VITAL:STATISTICS

Business statistics in Scotland compiled by Steven Wilson

Scottish employment IN FOCUS Jun to Aug 2016 Jun to Aug 2017 Top 10 companies in the UK electronics sector Northern Ireland Ranked by turnover

Scotland Company Total Turnover (£m) Cirrus Logic International (UK) Ltd 1,236.75 Wales Shin-Etsu Handotai Europe Ltd 155.58

London Optos Plc 85.53 Iomart Group Plc 76.28 64 66 68 70 72 74 76 Texas Instruments (UK) Ltd 71.61 The UK’s jobless rate held steady at a 42-year low during the three months to August, but pay growth Brand-Rex Ltd 66.60 remains sluggish in what is becoming a “clear and present danger” to the economy. Plexus Corp (UK) Ltd 57.41 UK unemployment fell by 52,000 to 1.4 million, according to the Office for National Statistics (ONS), leaving Jabil Circuit Ltd 47.84 the jobless rate unchanged at 4.3%. But pay still failed to keep pace with inflation as the value of real Coilcraft Europe Ltd 41.00 earnings fell by 0.3%. Total earnings, including bonuses, rose by 2.1% between June and August. This fell Petroleum Experts Ltd 39.23 short of the UK’s key inflation rate, which rose to 3% in September. In Scotland, the number of people out of work rose by 9,000 to 113,000 during the three months to August. This pushed the unemployment rate north of the Border 0.3% higher to 4.1%, still slightly less than the UK average. The number of people in work in Scotland rose by 40,000 to 2.57 million, taking the employment rate to 75.3%. The equivalent UK figure was 75.1% Source: Office of National Statistics

Business in Scotland Number of enterprises Turnover (£m) 390,000

370,000

350,000

330,000

310,000

290,000

270,000

250,000 £4.4bn 2010 2011 2012 2013 2014 2015 2016 2017 The contribution of EU nationals The number of businesses in Scotland has reached its highest level since records began 17 years ago. to Scottish GDP each year Official figures show there were an estimated 365,600 private sector enterprises operating north of the border in March this year. The total has increased by more than 52% since 239,970 enterprises were recorded in the year 2000. Ministers said the statistics show that Scotland’s business scene is Office market Scotland “thriving”. The figures reveal the estimated number of businesses rose by 3.1 per cent (11,110) between The office market in Edinburgh and Glasgow March last year and the same point in 2017. The increase over the latest year was driven by a rise in remains buoyant with high demand, low supply and the number of unregistered businesses (the smallest firms with an annual turnover below the VAT little new development. The latest Scottish office threshold and without employees) from 180,500 to 189,200 over the 12-month period. market report from Lambert Smith Hampton finds Source: The Scottish Government demand endures for good quality office space across the country’s two largest cities. This is “particularly apparent” in the high profile pre-let by the EXCHANGE RATES VS STERLING – % Change Government Property Unit (GPU), which has taken more than 181,000 sq ft in Edinburgh and is set to US Dollar (1.31) Euro (1.13) Australian Dollar (1.71) Chinese Yuan (8.69) Indian Rupee (85.12) Swiss Franc (1.31) 9.00% take a 180,000 sq ft pre-let in Glasgow. Aberdeen, by % change since last year % change since last month contrast, has ample stock across the city. However, 8.26%

8.00% 6.87% there has been an improvement in take-up this year 7.00%

5.65% when compared to the previous two. Despite the

6.00% high profile deals with the GPU, second-hand space

% has dominated city centre transactions in Glasgow,

5.00% Change

3.58% 3.64% with Grade A space accounting for just 22% of take- 4.00% up during the period. 2.34% Source: Lambert Smith Hampton 3.00% 1.80% 1.79%

2.00% 0.89% Region 12 month take-up Grade A share vs 10 year average of supply -0.36% 1.00% -0.11%

0% Aberdeen -22% 32% 0.00% Edinburgh CC 52% 41% Edinburgh OOT 70% 3% -1.00% Glasgow CC -20% 3% This month’s exchange rates (seen in brackets above) recorded on 20th October, 2017 Glasgow OOT 81% 36% 12 INSIDER December 2017 www.insider.co.uk VITAL:STATISTICS

IN FOCUS BUSINESS ACTIVITY SCOTLAND - OCTOBER 2017

Airport passengers Scotland UK Price of Goods 55.2 Edinburgh and Glasgow airports have reported 52.4 Price of Purchases 63 “record” September passenger figures while 62.6 Aberdeen booked a fifth straight month of Employment Level 52.8 passenger growth. Edinburgh Airport – Scotland’s 51.7 Backlogs of Work 49.6 busiest – reports September passenger numbers 46.5 were up 14.1% on last year at 1,291,640 – the New Business 55.3 busiest September ever recorded by the airport 52.8 Sector Output 55.8 and the sixth straight month passenger numbers 52.7 have exceeded one million. Glasgow Airport said it 010203040506070 “scorched” all previous monthly passenger records The Scottish private sector made a positive start to the fourth quarter, as output growth quickened in July, breaking the one million barrier to record at the most marked pace since July. Sector level data signalled that both services and manufacturing 1,082,000 passengers – a rise of 6.2 per cent on last output rose at faster rates. Although the overall strength of the upturn was only moderate, it was year. Aberdeen International Airport also reported concurrent with accelerated increases in both new orders and employment. a 3.9% year on year increase in passenger numbers Source: Bank of Scotland PMI/IHS Markit for September to 284,899 in total. % Change in business activity this month Airport Passengers % Change % Change 3.00% Q3 17 this quarter this year 2.00% Glasgow 3,063,858 13.88% 5.80% 1.00% 0.00% Edinburgh 4,108,709 11.72% 7.55% -1.00% Prestwick 259,800 15.32% 3.19% -2.00% Aberdeen 878,595 7.60% 3.23% -3.00% Highlands* 522,476 9.36% 7.41% -4.00% Overall 8,833,438 11.99% 6.36% -5.00% -6.00% (*Combined Total of 11 Airports) -7.00% Sector Output New Business Backlogs of Work Employment Level Price of Purchases Price of Goods

£4m Scottish retail sales Small & medium companies (<250 staff) Large companies (>250 staff) 108

The amount of backing by the Scottish 106 Government for the new Scotland I CAN DO Unlocking Ambition Challenge nde 104 x

Score 102

100

Economy of salmon 98 Region Employ Capital Salaries Local 96 -ment investment industry 2014 2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 spend Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Western Isles 363 £3.65m £8.8m £8.4m Highland 904 £28.9m £25.1m £87.4m Argyll & Bute 466 £11.1m £14.4m £24m Devolved cities growth Shetland 421 £10.6m £13.9m £40.5m Orkney 161 £7.5m £4.9m £4.3m 0.8

0.6 (

Scotland’s salmon farming industry is reported to compared

G 0.4 have increased employment by 13% in the 2016 year ro w to December while capital investment remained th 0.2 V

to a l

ue “steady” at £63m. The Scottish Salmon Economic each 0 I nde

Report from industry trade body the Scottish Salmon

other -0.2 x Producers Organisation suggests employment -0.4 numbers in the industry rose to 2,472 last year, with ) -0.6 91% of roles full-time. Figures for 2015 had shown Glasgow Edinburgh Aberdeen Dundee Inverness Perth Stirling Belfast Derry Swansea Cardiff the industry employed 2,188 people, 88% of whom -0.8 were in full-time work. A regional breakdown shows employment rose 12% in the Western Isles to 363 The performance of the cities in devolved nations varies widely. Edinburgh is the only place in the top last year, rose 24% in Highland to 904 and rose 6% in ten cities in our overall index, when measured against the priorities chosen by the public. The Scottish Argyll & Bute to 466. Gross salaries were down 8% in capital experienced a relatively large improvement in its score this year, with strong improvements also Western Isles to £8.8m, rose 9% in Highland to 25.1 seen in Aberdeen, Glasgow, Perth and Dundee. All of the cities in ‘Devolved Administrations’ experienced million and rose 11% in Argyll & Bute to £14.4m. an increase in their score in the 2014-16 index and only two of these cities (Derry and Swansea) still The Scottish Salmon Economic Report states capital remain below the 2011-13 average. One standout feature in terms of below average scores is health, with investment in Scotland was broadly flat last year at all cities scoring either around or below average. This is a continuing feature of this index over the past £63m, though investment in the Highlands region few years and raises questions about the different way in which the health services are organised in the more than doubled to £29m. devolved administrations, the extent of relationship between health outcomes and inputs (e.g. spending) Source: Scottish Salmon Producers Organisation and the likely impact of welfare reform on those currently not participating in the workforce. Source: PwC www.insider.co.uk December 2017 INSIDER 13 INSIDER: CREATIVE

Insider’s regular focus on Scotland’s creative sector by Ken Symon IN BRIEF Bringing a great Highlands industry back to life BBC political editor CLARE Campbell has travelled speaks out to America to gain backing to LAURA Kuenssberg, the BBC’s help bring a Scottish Highlands political editor, has spoken out industry back to life. against those who threaten and The US visit was a key part in the abuse her online. drive by the founder of Scottish The Scottish journalist has luxury design house Prickly said that there is no way the Thistle to bring tartan weaving campaign against her will work. “back to its home in the Scottish The BBC had provided a Highlands”. bodyguard for her at the Labour Campbell, who was selected party conference after critics Insider claimed that she was biased for ’s Twenty Women To in her reporting about Jeremy Watch list in 2016, launched Corbyn. the “Build The Mill” Kickstarter “I didn’t aspire to have the crowdfunding campaign to build finger pointed at me,” she told a new tartan weaving enterprise guests at a Jewish Care business in the Black Isle, just north of launch, according to a report Inverness. in The Jewish Chronicle. “What She had given up her career they are trying to do is silence in accountancy two years ago me.” to found the Prickly Thistle She said in an interview with brand and has since built up her boss, James Harding: “No an international clientele. She matter how unpleasant and launched the campaign after Of her visit to the US, Campbell personal it might be, it is not as bad as what other journalists struggling to find suitable They understand says: “I was invited by our face around the world in much manufacturing partners. supporters in New York to come more difficult circumstances.” She decided to build her own that what I am and tell the story, I’ve decided to mill on the Black Isle and bought take a week out of the two month a farm steading that was suitable doing is reinstating campaign to visit the US and meet for conversion and obtained pre- with those who want to help us planning approval for the project. a tradition to the meet our goals to see how they When I spoke to her on her visit can help further. to New York the crowdfunding Highlands that has “They have the ability to look campaign was about a month old in and see first hand the bigger and had already raised pledges of been missing for picture, and every day of their more than £98,000 towards a goal lives as Scots out of Scotland - of raising £500,000. centuries tartan is a topic of conversation - Tag Digital expands She went there because of the they see the value this industry has response she had already received a “fascinating and tremendously to the country, and that it should into the US to the campaign. “The bulk of the busy journey so far”. She went on: be much bigger than it is now.” A SCOTTISH digital business support has come from people “I knew that lots of folk in both Jackie Waring, CEO of business is expanding into the US as it in America who really believe in Scotland and the wider UK would angel group Investing Women targets revenues of £2m in the what I am doing and through this lead the way and buy into the said at the time of the campaign coming financial year. have backed me 100 per cent. They message and realise that what they launch: “What Clare and her Tag Digital is a pay-per-click seem to understand that what I are doing is just simply paying team are doing is taking an agency specialising in the am doing is reinstating a tradition in advance for limited edition old established industry and global events and publishing to the Highlands that has been products but while they have been through disruption creating a 21st sector, which was set up by missing for centuries,” she says. behind it from day one, they have century manufacturing facility husband and wife team Craig “It is more than just building a been matched by supporters from here in the Scotland that allows and Laura Davidson in 2011. The agency, which has offices mill, it’s rebuilding an industry that overseas. a global brand to be built from in Glasgow and London, is should be thriving in Scotland. I “I suppose in other words the Highlands. If the country is seeking to establish a presence think that this has really resonated you could say that we’ve given to prosper it is young business in Los Angeles. with the Scottish diaspora in everyone the opportunity to leaders like Clare who will lead It has already secured several North America who recognise jump on a bus and not only the way.” large-scale US projects for the that they can help bring a little get something unique for their The crowdfunding campaign coming year in New York, Texas of the entrepreneurial spirit back money but also help build a was launched in October, runs for and Philadelphia. In total, it runs to Scotland that their ancestors global business from the Scottish two months and is seeking to raise campaigns in 46 countries with clearly had when they took that Highlands; what has really the £500,000 target to convert clients such as New Scientist, massive step in moving half way made me pleased is the overseas and fit out the mill. It is offering Dubai World Trade Centre, GES, around the world for a better life.” engagement and 100 per cent reward items ranging from £15 to UBM and Shortlist Media. Campbell says the project has support.” £8,000. ■ 14 INSIDER December 2017 www.insider.co.uk INSIDER: CREATIVE

CREATIVE VIEW: Brendan Hughes ON THE MOVE

Orbit, the Edinburgh-based The art of uncovering lost masterpieces communications agency, has AT ITS heart our two series of Britain’s added four new staff as it Lost Masterpieces starts with a very expands into new areas. John simple premise. There are around Ayscough has joined as creative 22,000 works of art in galleries and director; Heather Cumming museums around the UK which have as senior designer; and Emma question marks hanging over them. Ahlqvist and Kiera Winfield In many cases we cannot be sure who have both been hired as painted them. So, among them might designers. there be masterpieces, languishing in store rooms? DC Thomson Publishing Simple isn’t it? Let’s find works by the has changed its name to DC great masters… Thomson Media in light of its Luckily, we have a real expert on hand. expansion into a variety of media Bendor Grosvenor, an art historian formats. who specialises in doing just that. Using a remarkable database – the Veteran PR operator Omar ArtUK website - he hunts down Mohammed is the new head paintings that are “unattributed” or of PR and external affairs for look like they may be by an artist Aberdein Considine. whose work he knows but aren’t attributed to that artist. Beattie, the communications And we take it from there. company founded in Lanarkshire That’s how we found ourselves in and now headquartered in Pollok House in Glasgow earlier this London, has appointed its first year looking at a painting that looks managing director in Canada. like it might have been painted by Sue Holland, who was the City Rubens. It was catalogued as “after of Toronto’s marketing supervisor Rubens” which means that it WASN’T for economic development and painted by him. And in fact there is a similar painting in Italy and it was Laurna Woods, believed that ours was a copy of Beattie Group that one. Nonetheless Bendor was reasonably certain. So, job done? Far from it. What followed was a summer to confirm that the painting we had unique as everything has to happen in of transporting the picture – not as taken from Pollok House in Glasgow real time. The cleaning and restoring simple as it seems – cleaning and was truly the original head study takes between six to eight weeks, and restoring it, and looking at other painted by Rubens himself. during that time real clues emerge reasons why it might be a Rubens – So how did we manage to prove it? which we then have to follow up. how did it to come to be in Glasgow, There are a couple of clues in the So it’s impossible to simply sit down what makes us think it could be by the painting itself – one important clue and work everything out in advance. Great Master himself? is that there is a part of the painting We can guess, but at the end of the culture, will head up the Beattie That took us to the Pitti Palace, where the artist changed his mind and day that’s all it is. For our production Tartan and Only Marketing Florence, where there is a version of redrew a collar. That shows primary manager and the co-ordinator who teams in Ontario. the same painting we found at Pollok. intent, and a copyist would never have sorts all the filming plans out that Laurna Woods, CEO of Beattie The Pollok painting was thought to be copied that. The quality of the work then becomes a nightmare. Suddenly Group, said: “Sue knows how a copy of the Florence one. However, itself was of a very high standard. it’ll be “we need to be in London/ the city ticks and we’re looking using some deft science and detective Just as important though - in 1742, Florence/Madrid/Antwerp on forward to her growing our work we were able to show that the the most eminent art historian of his Thursday...” And that’s not easy. two key brands in the province. Florence painting is a copy of the one age, George Vertue, recorded seeing When it’s all done though there is real She will also work with Deirdre in Glasgow. Oops! a “painted head [of] G. Villars Duke of satisfaction. We have uncovered a Campbell, our MD of Canada, to Now all we needed to do was get our Buckingham - by Rubens” in England. truly important painting. The gallery grow our crisis communications painting verified by the world expert Now Vertue knew his stuff, and if in Glasgow is delighted and have boutique Only Reputation.” on Rubens, Ben van Beneden, who the painting he saw is our picture, been running a variety of study days runs the Rubenshuis in Antwerp. And then that helps build art historical based on the work. Their footfall is up, Shaun Milne has been that’s where we hit a bit of a (major) momentum behind an attribution to and their website gets extra hits. And appointed as assistant news snag. The week before filming Ben Rubens. it’s a real pleasure to be able to make editor on The Scotsman and was not able to travel. So we waited. The cleaning itself revealed some something clever and intelligent – Edinburgh Evening News. And waited. And waited. The series clues. And an X-ray revealed that the and entertaining – for BBC Four that was now scheduled. Transmission artist originally had a slightly different performs a true public service. ■ Mike McQuaid, a former deputy approaching. Fingernails all gone plan for the Duke of Buckingham’s hair editor of the Motherwell Times at this stage. And then, magically, which reassuringly matched a drawing Brendan Hughes is the executive and Bellshill Speaker has gone in early September Ben turned up which we know was by Ruben’s hand. producer of BBC Four’s Lost freelance covering crime, court at our restoration studio in London Making an arts series like this is quite Masterpieces. and council reporting in Central Scotland. www.insider.co.uk December 2017 INSIDER 15 BURNING:QUESTION in association with The burning question Is the increase in base rate likely to help Q growth in the Scottish economy? NO MAYBE NO

Mark Gregory Graeme Bruce Crawford Geddes chief economist partner director EY CMS QBellair (Scotland) Ltd

An increase in interest rates is designed Whether a rate rise will be positive or I’m actually indifferent to the rate rise. Its to slow down demand and head off detrimental to a business will very much merely a symbolic gesture from the BOE to inflationary pressures but a rate rise of depend on the sector and the company’s put consumers and business on notice that 0.25 per cent is very small and not likely to particular circumstances. Those businesses the era of artificially cheap money is coming dampen growth significantly on its own. with substantial borrowings will clearly see to an end. What happens over the next two However, business and consumer this as another challenge and will need to years is of more relevance. confidence in Scotland is fragile and the review their plans accordingly. Too many consumers have adjusted their most significant shock to growth could be Although the initial rise has been small, to spending habits to reflect the cheap money psychological. If consumers and businesses the extent that this is a precursor for further and will have to prioritise spending going expect further rises then they are likely to rises, firms in this position will be wary. forward on items such as more expensive reduce their spending and pay down debt or However for lenders and those companies mortgage repayments which will have an save more, slowing growth. which have surplus funds and war chests, a adverse effect on retail spending. rise will be welcome.

MAYBE NO NO

Alasdair Humphery Paul Mason Jo Macsween lead director corporate finance group chair JLL Scotland partner Vistage UK Chiene + Tait

The increase in the base rate has been met This small rate rise is unlikely to do much, While this rate is historically low, businesses with mixed reactions, but markets had if any harm to the economy, but it almost and markets tend to ask themselves, ‘ok, so already started to factor in a rise and certainly certainly will not help growth. The actual what’s coming next?’ and perhaps hesitate in for Scotland’s commercial property market, negative effect on consumers will be about making key decisions. which is performing well, any impact will be £20 per month per £100,000 of mortgage. Scotland is still underperforming relative masked. The rise had been priced into markets for to the wider UK economy and we need Benchmark yields in commercial property some time, so any stabilising effect from to implement imaginative and ‘interest are inextricably linked to interest rates/ delivering the expected rise will have been resilient’ ideas. gilt rates, but this small increase is unlikely minimal. The benefit to savers is likely to be For example, if women set up businesses to have a great influence on those looking immaterial, given the limited holdings in at the same rate as men the boost to the to buy and sell as the level of competition cash for most. Scottish economy would be £7.6bn – let’s do remains high and rates are still at historically more to support that result. low levels.

If you would like to contribute to the Burning Question or suggest topics please email [email protected]

Aberdeen | Edinburgh | Glasgow | cms-cmck.com

16 INSIDER December 2017 www.insider.co.uk At Clyde Travel Management we pride ourselves on providing solutions that fit the company and the traveller. Giving staff the ability to make their own travel bookings, but with companies retaining control. With invoices, statements and reports all housed in one place, and all departments kept in the loop at the touch of a button.Efficient, effective and immediate. Come and speak to us, we think you’ll be impressed.

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Aileen McLelland Business Travel Consultant THE BIG PROFILE: PAUL ATKINSON, PAR EQUITY

18 INSIDER December 2017 www.insider.co.uk THE BIG PROFILE: PAUL ATKINSON, PAR EQUITY

LOW BOREDOM THRESHOLD KEEPS ATKINSON INVESTING

By KEN SYMON

T’S PROBABLY the hardest business he formed with well-known technology and software and business thing I’ve ever done,” admits headhunting veteran Ian McLeod. change. It is, he says a very UK- IPaul Atkinson, referring to the The combined group has an centred business. Head Medical deals founding of Edinburgh-based expected consolidated turnover of with placing medical practitioners venture capital firm Par Equity in about £65m. Atkinson believes that both at home and abroad and is a 2008. they can grow the current combined very international business. Change “Unbeknown to us when we started business organically to a turnover Recruitment is principally involved the business, the banking crisis was of about £70-80m with further in accounting and finance but also about to hit,” he says ruefully. “So acquisitions required to “add the last with teams that do investment and literally by the time we had got our 20 per cent” to take them to around risk management to which has been licence to run funds from the FSA - as the £100m turnover mark. added a new construction business it was at the time - it was more or less “We’re deliberately designing it so with a new hire from one of their the same time as the banking crisis that it doesn’t need so much hands-on competitors. started. help from the likes of me,” he explains. There is a clear strategy to the “Our ambition was to build “I’m a long, long way away from the development of Taranata, Atkinson an institutional fund but all the recruitment tools these days and the says. “The intention is to add more institution doors slammed shut guys who are running the businesses brands with other specialisms, because of the banking crisis so we under Taranata are a lot more capable particularly if they bring more built the business from the ground up international context. In my view the with private investors. That’s why it’s more international the business is the the shape it is today.” Part of my role is to make sure that more valuable it will be and the less And that is a pretty impressive prone to disruption in the market it shape: since its launch Par Equity has we keep our eyes looking up and will be.” invested more than £80m in over 40 looking forward and that we can see About 30 per cent of revenue companies, it has completed five exits, line just now is international and two of which were in medtech. Of we’re not going to run into a tree, we Atkinson says: “I would see that that £80m, Atkinson estimates that increasing; certainly the companies more than 70 per cent has gone into can see the forest that we’re looking at as potential Scottish companies and says that Par acquisitions, at least a quarter of them has some really good companies in its than I am in terms of what’s actually have got very significant international portfolio. happening in the recruitment sector exposure.” Compared to launching Par Equity today. Part of my role is to make sure He believes that this will give in the teeth of the international that we keep our eyes looking up and Taranata a real competitive edge banking storm that blew down some looking forward and that we can see because he says that there few UK famous investment houses, Atkinson’s we’re not going to run into a tree, we recruitment companies that are truly latest business venture is being done can see the forest,” he laughs. international. in much more benign conditions. “The impact of technology on all “I want to get it to a scale where we He is putting together what he aims sectors is going to be huge. And part can potentially list the business or do to be a “recruitment supergroup”. He of my role is to make sure that my something that creates some liquidity added Change Recruitment, which recruitment business actually takes because we have got a number of he bought in a deal announced advantage of the new technology and shareholders in the business just now in May for an undisclosed sum, is not caught out by it.” and that number will increase.” to his existing businesses of Head Each of the businesses covers The group as a whole will benefit Resourcing and Head Medical and he different specialisms with Head from the different strands within it has since added Atkinson McLeod, a Resourcing handling information because, as he says, recruitment is a www.insider.co.uk December 2017 INSIDER 19 THE BIG PROFILE: PAUL ATKINSON, PAR EQUITY very cyclical business. Atkinson says now: “It didn’t work He has a clear picture of the way out but I had quite an interesting the ambitions for the group will be tour of the Middle East selling IT realised: “Identify markets where they consultants into Qatar, Dubai, Abu can differentiate themselves, apply Dhabi and Bahrain.” technology smarts to it and give the He then spent a year headhunting teams that work in it a competitive for the IT division of the Royal Bank advantage.” of Scotland and then a further year The economic conditions look so working for what is now IBM Global very different from those in which Services. Par Equity was created with the Atkinson met Gordon Adam, who shortages in the labour market caused became his business partner, and by EU nationals who are leaving, the pair set up Direct Resources in are threatening to leave or who are 1995. “Four years into that we were looking elsewhere rather than the UK approached by an Nasdaq-listed IT because of Brexit. services company MasTec Systems Atkinson says: “There is no doubt. Corporation to buy our business with We’re at record high employment a view to building a strong footprint and the skill shortage in some sectors on the UK for them. We were offered is really acute, particularly IT and what was in hindsight a very good particularly medical. But there are It didn’t work out but I had quite an deal. skill shortages right across industry. “I stayed on to do the integration “The mood music is making the interesting tour of the Middle East with the parent company and UK less attractive as a destination for Gordon stepped out to build a second international workers. Our mood selling IT consultants into Qatar, Dubai, company that we had formed called music outwardly looking is the wrong RecruitmentScotland.com, which was mood music to attract people in. Abu Dhabi and Bahrain Scotland’s first jobs website business I see that as part of our role in the before S1 Jobs. recruitment business – the more Atkinson’s move into recruitment “About six to seven months after international we are the more we can was not a planned one. He had we sold Direct Resources we decided help with that.” been working in an IT company as to see if there was a market to sell He goes on: “Brexit is having an an engineer and moving into sales the online business largely driven impact for a couple of reasons – working in “have car will travel a by the hyped state of the market – it number one exchange rate. A big part lot” job in a territory that covered was dotcom boom time. We started of the reason that Polish construction the west of England and Scotland to hear stories of how much TMP workers are going back to Poland is from Manchester. In that role he sold Worldwide were buying online because the pound in their pocket computer hardware and software recruitment sites for and thought is worth 20 per cent less than it was and then moved sideways into the IT maybe we should take a look at before. industry. that. That was competitive, we hired “At some point the rules around “Almost by accident I fell into advisors to take the company to immigration and skilled workers recruitment in a role with Computer market, we had four offers for the shortages will become clear and People in Manchester,” he says with business and the offer we took was there will be a mechanism to bring the job coming about after he met with TMP Worldwide, which owned in international workers I’m sure. them at a computer exhibition. Monster.com. What it will be we don’t know yet. When Computer People opened “At the time of the deal TMP In the meantime skill shortages their Scottish office in 1987 Atkinson Worldwide was trading at 200 times are generally good for recruitment moved to head it up and has lived and earnings on Nasdaq and we effectively companies. So we have no shortage of worked here ever since. sold our business then for half that: demand to find people we’ve just got He was headhunted to set up 100 times earnings. We were in the to be creative about how we go about what is now called Parity in Scotland fortunate position of having built and finding them.” as regional director. Then he and sold two businesses within a year of And he believes that Taranata is a couple of colleagues decided to each other. well placed to do that because of go into business for themselves. “That was when I first started its existing international footprint. investing in other people’s companies, The group is already operating in 20 IN FOCUS: Paul Atkinson CV the first being Learning IT, an IT countries in accountancy, finance training business in Stirling run and medial recruitment. Head Paul Atkinson is the founding partner of boutique investment by an ex-client of mine Duncan Medical is supplying into Australia, business Par Equity, which backs technology-based businesses. Macleod. I invested in that business New Zealand, Middle East, China, Prior to founding Par, Paul co-founded recruitment businesses in 1998, went onto the board as non- Singapore, the Maldives and the Direct Resources which was sold to Nasdaq-listed iGATE executive director and later sold it to a Corporation in 1999 and RecruitmentScotland.com, which was Caribbean. But it also places people management buyout backed by Baxi acquired by another Nasdaq-listed business TMP Worldwide across the UK particularly in some in 2000. He is now executive chairman of Taranata Group, a Partnership.” of the remoter regions. “Being recruitment business with ambitions to grow, to scale and seek Between 1998 and starting Par international gives us that edge in a market listing. Paul grew up on a farm and has a BSc in Physics Equity in 2008, Atkinson invested terms of winning UK business,” he from Manchester University. in 16 companies. He founded Head says. Resourcing in 2001 after the dotcom 20 INSIDER December 2017 www.insider.co.uk THE BIG PROFILE: PAUL ATKINSON, PAR EQUITY bubble had burst and, he says: “I could be technology; it could be founding partners along with Robert didn’t feel like doing too much business model but something that Higginson, Paul Munn and Andrew investing in technology businesses at differentiates them in the market, a Castell, all of who come from that point.” new way of doing things. But it was different backgrounds. In 2008 Atkinson stepped out also important that all the companies “We’ve got great ambitions for the of the executive suite at Head we invest in have some kind of Par business. We recently opened Resourcing to set up Par Equity. international context because most an office in San Francisco and we’ve “I wanted to professionalise the likely the exit for these business will got new partners joining us with investment I had been doing as an be an international trade sale. that,” Atkinson says. “The ambition angel prior to that. Par Equity was “We wanted to work with people there is to build a transatlantic health really a business set up to back new we could work with in terms of tech fund which will be our first technology entrepreneurs with both style, characteristics, personality and institutional fund, a bit of a game money and expertise. That’s been the approach. changer for us. We’ve already had model ever since really; we’ve got a “The actual areas of technology quite a lot of success investing in very strong professional investor base that we invest in are very broad and medtech business: Aircraft Medical that sit on boards, do the diligence I guess the other aspect is that we’ll sold a couple of years ago was one and help these companies develop only invest in businesses where we’ve of our investments and we also and succeed.” got deep expertise in the sector in our invested in a business called PathXL, Par Equity’s recent investments direct investor base. If we don’t have a patent recognition software business include Snap40, a wearable health deep expertise in the space we won’t for detecting cancer on digitised monitoring device business; Union invest.” pathology slides. Blazes, a laser technology spinout A member of the Par Equity “When we started in Par Equity from Heriot-Watt University; Particle syndicate will work with the company, we were probably investing earlier in Analytics, a spinout from Edinburgh sometimes acting as investor director, the cycle. These days we are investing university; Par were one of the sometimes as chair or sometimes in things that have already got some founding investors in ‘light to Wi-Fi’ in an advisory capacity. There are commercial traction.” business PureLiFi; Money Dashboard, about 140 members of the Par Equity Par Equity has always looked the personal finance app and syndicate, about a third of whom are UK-wide for its investments but, QikServe, the dine-in food ordering interested in being hands-on with as Atkinson says, “Because we are and payment app. businesses. They include people who based here in Edinburgh, all the local But while some might have settled have built successful businesses or deal flow lands on our doorstep, we for this life as a professional investor, people from the advisory community, don’t have to try too hard for that. Atkinson is also working at a strategic partners from law firms, accountancy I think because of that a significant level building his recruitment firms or senior executives from percentage of our deals are in business. Asked why he doesn’t stick banking, finance and industry with Scotland. But although we’re based in to one or other, he says: “I’m actually quite a number of people still active in Edinburgh we don’t see ourselves as a not quite sure; maybe I’ve got a low business. Scottish firm per se. boredom threshold.” This is probably Paul Atkinson was one of four “So far we’ve exited five companies why if you add up the companies he and we’ve lost four. So our hit rate is has invested in prior to Par Equity rather better than the norm. Before and since its inception it comes to One of the reasons I back other tax we’ve generated an internal rate of about 60 companies alongside the five return of about 22 per cent overall.” businesses he has started. people’s businesses is that I like to That, as Atkinson says means they “I enjoy business, I enjoy the people are in the top quartile in terms of I work with in business and I get a help other people get to a good place as performance in their asset class. real kick out of it. I like seeing the A key to all of this is timing the people I back being successful. One ZHOOLWłVQRWDOODERXWğQDQFLDOUHWXUQV market right. He says that you can of the reasons I back other people’s have a great technology but if you businesses is that I like to help other don’t hit the market at the right time it people get to a good place as well; it’s can come to nothing. not all about financial returns.” “If we hadn’t decided to sell Par Equity has created hundreds of RecruitmentScotland.com before the jobs, he says, and that alongside the dotcom burst then it probably would other angel networks like Archangel have been bust. Or probably not bust and Pentech they make a big but we wouldn’t have been able to sell difference to the Scottish economy. the company for 100 times earnings He says that Scotland is unusual in for the next ten years. being under-served by venture capital “You get a good deal when the time firms but is well served by active angel is right. In the case of the ones we’ve investors. sold already you generally get three Atkinson explains what type times money out. In two years that’s a of business Par Equity invests decent return. We try and do the right in: “From the get go we were thing for investors and managers. looking for businesses that have If we keep all that in mind we’ll innovation at their core. Innovation probably have a decent investment is quite a catchall phrase: it business.” ■ www.insider.co.uk December 2017 INSIDER 21 LETTER TO MY YOUNGER SELF: GRAHAM SUTTIE

Dear Graham

IT’S ALREADY been quite a journey from Stick in at the course and do what you can bookmakers to bombs, but now you’re 16 and – it won’t be easy and it will seem pointless it’s time to decide your own path. You won’t at times, but know this is the challenge you know what that path is yet but you’ll know have been set. To give in now would be your in your gut which is the right one to take. By downfall and you need to realise only you can now, you’re recognising your instincts and do this, not anyone else for you. how subconsciously they have kept you one You will face the greatest challenge of your step ahead of the curve. You also understand life in family. When it all falls apart, look to Graham Suttie your weaknesses. your friends. They are the rock you build your Managing director of Kained Life will challenge you and those instincts life and business on. They will get you through Holdings, Graham Suttie, the every single day. Listen to your heart, embrace and over the line at university – remember renowned bar owner and your weaknesses, and you will succeed when this, as you will owe them everything. restaurateur who is a leading everyone else dismisses your dreams. You By now your career as a bouncer has figure in the Scottish hospitality will learn that those traits people wanted you already put you through university; it’s paid industry, underlines some life to lose are the very ones which will help you for books, rent and beer. Now you will be lessons to his 16-year-old self… succeed. But first, even if you’re not sure about managing doormen across the city, running it at the time, you’ll need to get that university clubs and making a name for yourself. You degree. Believe me it will be worth it. will meet characters good and bad. Stick to A chance encounter with a female bouncer your gut. Things will land at your feet but not in Glasgow will set you on a sure-fire collision all good. Ignore the guns and rivalry. Instead, course with the hospitality industry, and focus on the right people and the good energy. be the right next step after time in Belfast’s You will know who. Aspire. Pay attention to industry and the family business. Take her a man called Colin Barr, his influence will offer of a job, experience Scotland’s industry shape your approach. Listen to people around from the doors of the bars and clubs, absorb you like Eddie Tobin. Learn from him and his events like T in the Park, the people, the professionalism. Absorb everything. processes and the big names. It will all come You will reach the point where you have to fruition in the years to come. Embrace this to make the difficult and seemingly senseless time, as you will flourish and grow. You will decision to leave Glasgow, with its comforts realise your strengths, and the gifts you have and highlights, and take the next steps in the been given to succeed - if you work hard. journey. By now you will have realised that the When you start university, you’ll be no goal is to have your own bar. stranger to work. At first, you’ll want to You look to Ireland for inspiration. It’s a emulate the American side of the family and journey that will almost break you, but it’s one chase the hotel dream. Your course tutor will you must make. You will return to Glasgow take you aside and tell you he can’t teach you within the year with a car, a bag of clothes and any more than you already know. This is a a duvet. You will have £10 in your pocket. You compliment. Don’t despair but do take his will sleep in the carpark of Jinty McGinty’s advice – you will enrol in the Hunter Centre on Ashton Lane for months and you’ll be too for Entrepreneurship at the University of proud or too stupid to ask for help. But help Strathclyde where you will finally understand will come. Those friends you made will pull the joy of academia. Relish every day here, you out. Unwittingly, you’ll move in with the absorb every word and role play every guy who will become your business partner scenario in your own head. This will stand and lifelong best friend. You’ll be dragged you in good stead for developing your own back into the world you left but you will find a approach to business. way out quickly and begin your ‘real job’ with 22 INSIDER December 2017 www.insider.co.uk LETTER TO MY YOUNGER SELF: graham suttIe

Allied Domecq in Edinburgh. Here is where Matthew Clark, and choose the unknown you will learn the trade – the ins and outs of path. You will do all this on your mobile brands. whilst sitting on the pavement outside a You’ll meet someone called Alison Hart little boarded-up pub called The Elbow and she’ll be one of the single most influential Room in Glasgow’s rundown Finnieston people in your life. Her strength and area. confidence will inspire you and her friendship You will wait for an old face from your will be crucial when you set up your business. past to finish meeting the landlord and Be a force for good and help others on their Most importantly, here is where you will meet pray he doesn’t want the pub. The landlord journey as others have helped you. It doesn’t Rachel Stirling. She will change you and your manages to squeeze you in and you’ve got always work out as you thought it would life forever. She will bring you back to the three minutes to view it. You share your but remember university, when you learned world of family, make you stronger and never vision and shake hands there and then. Your that you were the only one who can fix it – leave your side. She will become everything. new journey begins. nobody else will. You will go on to work for Diageo and a In the next decade, you and two friends You will go into the autumn of 2017 New World Winery, learning marketing and will build one of Scotland’s most forward- looking to the future and exciting new national accounts. You will meet amazing thinking hospitality companies. You will projects that will take Kained and yourself people and personalities both in these collect accolades such as Scottish Emerging on a new path. You will write this letter and businesses and outwith. David McCall will Entrepreneur of the Year, Scottish Food be reminded just how truly blessed you have prove to be the voice of reason and the person Pioneer and Outstanding Contribution to the been through the good and the bad, the you trust above all others to tell it to you Scottish Hospitality Industry. Your energy friends you have lost and the friends you have straight. He is a rock. You’ll also meet snakes and enthusiasm for the trade will help you made. It will drive you to continue to develop and face personalities who make you question surround yourself with amazing people and learn and it will cement your vision of a yourself and your approach to life – get over both working with and for you. Never stop better hospitality industry with Scotland as this quickly. Remember who you are. learning from them, they will get you to a global leader. You will also want to go to One day, the decision you knew you had where you know you need to be. The industry Lebowskis and relive that first pint from 2007. to make will arrive. Continue your career or you have chosen has plenty of egos. risk it all. Stay true to your instincts and let Karma be Slainte Mhath, You will be thankful for the opportunity but your guide. Life’s a two-way street. Look after Graham will gracefully turn down an amazing role at those that look after you and your business. www.insider.co.uk December 2017 INSIDER 23 MARKET COMMENTARY

INCREASED REGULATION AND INCREASED UNCERTAINTY AHEAD IN 2018 If one word could symbolise 2017, it would business world to ensure that young people have have to be Brexit. The momentous political the right skills – both practical and theoretical - to decision may have been made in 2016, but it enter the marketplace. has come to dominate our everyday lives this Expect innovation to also enter our everyday year. Politicians have been bogged down in business conversations. In many ways, Scotland is constitutional debate and wrangling, while leading the way in the tech world. Countries around business leaders watch from the sidelines. the world are looking at cities like Edinburgh and Many, increasingly concerned at the lack of any Dundee and learning lessons from us on how to real, definitive answers on the future direction support and encourage the growth of the start-up of our country. community. But, in an era of disruption, it’s critical The debate over whether we should have that we continue to stay ahead of the curve and opted to remain or leave may rumble on in the focus our attention on equipping start-ups and new background, but the main focus now within the tech firms with the right support – from tax relief business community is the need for a clear, concise such as R&D support, to increased infrastructure strategy going forward. investment. Focused spending on digital readiness Companies like certainty and thrive on long- Andrew Howie and the capability of our road, rail and air networks term contingency planning. What we’re seeking is critical. from political leaders over the next 12 months is impact of that plan, and further actions, in the 2018 will be a challenging and uncertain year, assurances that access to global markets and a coming months. but we’re approaching it from a strong position. wider business-friendly environment will remain in While the European question will undoubtedly The Brexit vote may have created a climate of place, allowing Scotland and the rest of the UK to dominate the news agenda in the year ahead, unease, but the referendum came at a time when flourish in an open and transparent manner. there are other more domestic issues that need our economy was strong, unemployment was low That issue of transparency has also been in the to be addressed – including Scotland’s chronic and the business community was working together news recently and how we tackle tax avoidance on productivity challenge and the ongoing skills better than ever before to create a robust, vibrant an international scale could become a major focus shortage. In many ways, both issues are a hangover economy. for the country in 2018. The UK’s participation in from the 2009 global economic downturn. As we Now, more than ever, we need to collaborate the OECD’s Base Erosion and Profit Sharing (BEPS) enter 2018, it’s imperative that we tackle the issues on a greater scale, explore what it is we do best Action Plan has gone some way to addressing head-on to avoid added obstacles in a particularly and where we need to push ourselves out of our international taxation, with countries around the uncertain period. The Scottish Government’s recent comfort zone to tackle chronic long-term issues. world agreeing a set of principles to harmonise focus on education provides the perfect platform By working together with one voice, Scotland’s policies and create a more level playing field for to explore what schools, colleges and universities businesses can brave the storm ahead and embrace businesses of all sizes. We should start to see the could and should be doing in collaboration with the the opportunities that change can bring.

Andrew Howie is Managing Partner of Grant Thornton in Scotland & Northern Ireland. www.grantthornton.co.uk 2018 PREDICTIONS WHAT DOES 2018 HOLD FOR SCOTLAND’S MAIN BUSINESS SECTORS? We asked 13 sector experts for their 2018 predictions for Scotland’s economy and some of its major business categories

ECONOMY

CRUELLY, it has been said that God created recent rise in the price above $60 is sustained. economic forecasters to make astrologers look This combination of a weakened consumer, an good. What can we confidently say about the invigorated exporter and stabilisation in the oil prospects for Scotland’s economy in 2018? sector should deliver modest growth. Sterling’s 20 per cent depreciation since mid- Whether we grow quickly or slowly there is 2015 will continue to cast both shade and light. a bigger economic prize at stake. Scotland sits Just over 12 months ago inflation was under comfortably towards the top of any international one per cent. By the end of 2017, the exchange league table of economic performance but rate-induced rise in import costs saw it rise above still lags behind the very best. Across Australia, three per cent. Netherlands, Sweden, Switzerland and the US While the impact on inflation of sterling’s the average citizen is £10,000 a year better off fall will wane in 2018, prices are set to rise than the average Scot because it takes us until faster than wages for much of the year, putting Friday at 5pm to produce what they manage by consumers’ disposable incomes under pressure. Thursday lunchtime. We know how to enhance Having already started to run down their savings productivity: successive, state-of-the-art and accumulate more debt, their options for strategies have advocated investment, both sustaining spending will be limited. Although public and private, in people, physical assets and rising employment will mean there are more Stephen Boyle innovation. people earning and able to spend, businesses Investment is hard. It means sacrificing chief economist that sell directly to consumers will increasingly consumption today for more tomorrow. What RBS feel a top line pinch. That will be especially true happens to our economy in 2018 is important to for sectors that rely on discretionary spending people’s living standards and job prospects. What from disposable income. rippled through Scotland’s economy. Much of matters more is whether in 2018 we embark On the upside, sterling’s weakness makes the restructuring that was needed to deliver on the investments that will win us that extra exporting more attractive. Currency depreciation an industry fit for a lower price future has been £10,000 each. Will we? alone rarely delivers a marked boost to exports; completed and the period of contraction has Look out for Stephen Boyle’s regular podcast on the pound declined by 30 per cent in 2007-08 ended. There are signs that 2018 will bring a the latest economic news affecting Scotland on but exports fell in the face of weak overseas gentle recovery and that will be cemented if the insider.co.uk demand. In 2018, however, global growth looks set to accelerate modestly and, especially important for Scotland, the euro area will record another year of decent growth. Low sterling and rising demand should be good news for exporters and will disproportionately benefit manufacturers but should be good news, too, for tourism. In June 2014, oil cost $115 per barrel. For much of 2016 and 2017 it was $50 or less. That led to a severe contraction in offshore activity and radical cost reduction in the industry that

www.insider.co.uk December 2017 INSIDER 25 2018 PREDICTIONS

DEALMAKING

Calum Paterson Artificial Intelligence, the Internet of Things and managing partner augmented data analytics. Scottish Equity Partners An increase in investment exits has also been a feature of the last 12 months and there are no Private equity and venture capital deal activity signs of this abating as we look ahead to 2018. has remained resilient over the past 12 months, While financial buyers often have significant notwithstanding the challenging political and firepower, trade sales remain the principal exit economic backdrop. The latest deal data from route for most private equity and venture capital Invest Europe highlights that more than €4.3bn backed companies. As well as helping to drive was invested in over 3,000 European companies export sales, the weaker pound is making UK last year, with an increasing trend towards larger assets relatively more attractive to overseas deals. Despite all the uncertainty over the full acquirers. Absent a dramatic change in political impact of Brexit, the UK is still the largest market and economic sentiment, we predict that this for private equity and venture capital in Europe. will continue in 2018 as international buyers look We predict the industry will remain strong and for bargains. There have been some signs of life resilient in 2018. in the IPO market after a subdued 2016 for public Although London and the South East continue listings, but we do not expect the recent burst of to produce the highest volume of deals, there activity to equate to a sustained increase in new is increasing activity across other parts of the deals in the coming year. UK. Scotland has a relatively strong ecosystem For entrepreneurs and founders, however, for start-up and early stage companies and equity firms are increasingly focusing on these the good news is that there is plenty capital we expect to see more high growth prospects areas and targeting what is an increasingly available for investment. Many private equity emerge over the course of the next 12 months. large pool of high-growth UK-based companies and venture capital firms have substantial funds Demand for private equity and venture looking for capital. and are on the lookout for attractive investment capital is being fuelled by the emergence of The BVCA’s ‘Innovation Nation’ report opportunities. Recent high valuation levels new business models and convergence of highlights that 50 per cent of venture capital in the current market reflect the significant technologies (e.g. SaaS, cloud computing). investment in the UK is concentrated on the competition for deals. There are no obvious signs Consequently, the funding market is both digital economy. We expect this proliferation of of this abating any time soon, but choosing buoyant and competitive. As well as specialist technology deals to continue during 2018, with the right funding partner is one of the most technology investors, more generalist private growing interest in emerging segments such as important decisions a company can make.

26 INSIDER December 2017 www.insider.co.uk 2018 PREDICTIONS

TECHNOLOGY ENERGY

Joanna Monaghan senior associate Shepherd & Wedderburn

The one certainty regarding predictions is that they are rarely accurate – that is certainly true in the case of the energy sector, where there are so many unpredictable variables, not least Donald McLaughlin, the global economy and, nearer to home, UK Government policy. However, there are some chair of Skills Development Scotland’s very promising trends that bode well for the Digital Skills Group year ahead. The digital skills gap will continue At a macro level, the price of Brent crude has to be a major challenge. With 12,800 recently shown some tentative signs of recovery job opportunities annually there are (having recently hit $60 per barrel for the first concerns there simply won’t be enough time since 2015). As a result, the economics of people to fill these roles. a number of projects in the UKCS/Norwegian If the improvement in Brent pricing continues, This doesn’t just affect technology Continental Shelf (and elsewhere within EMEA) we may also begin to see more conventional companies, the challenge is going to should begin to look a little more attractive to sources of finance becoming available again become more acute across all industries. investors. to exploration and production companies, and Even looking at sectors such as farming, The most recent indications from OPEC and there have already been early signs of that in a recent survey suggests 82 per cent of Russia are that their current reductions in some recent, modest equity issues. farmers felt digital skills will be important production will be maintained into the second On the renewables front, following the to their business in the next five years. half of 2018, which should add some further doom and gloom prompted by the gradual Serious investment will focus on resilience to Brent. It is worth noting, however, withdrawal of various support mechanisms, analytics, blockchain, cyber and social that an increase in US-tight oil production may the UK renewables landscape is looking slightly and this is a good guide to what will be be expected at higher West Texas Intermediate rosier. increasingly important in the sector in pricing. The Green Investment Bank was acquired 2018. On the UKCS, we will see the impact of by a Macquarie-led consortium in August, It is no surprise that analytics, such a number of recent changes in ownership with a £38m investment in a UK energy-from- as AI, machine learning and big data, and operation of key producing assets and waste facility by the newly-privatised entity will be important. This has developed midstream infrastructure (including Chrysaor’s (now known as the Green Investment Group) over several years with the benefits acquisition of Shell’s interests in a number of following hot on the heels of the acquisition. now widely recognised by industry, UKCS assets and INEOS’ acquisition of the Forties Other promising signs are the UK rejoining the governments and whole economies. Pipeline System) and a continuation of the top 10 countries for investment in renewables Blockchain is another growing operational efficiencies achieved in recent years. (according to the Renewable Energy Country technology and will continue through In addition, there are likely to be further Attractiveness Index) and the £340 raised new economic models such as Bitcoin. divestments of later life assets, which will recently by the renewable infrastructure Cyber-crime is now seen as a boardroom hopefully be supported by the creation of a fund Greencoat UK Wind – a further vote of issue. This will be a massive area of focus transferable tax history, which, at the time of confidence in the sector. for businesses with a lot of time and writing, we hope will be announced by the Developers are continuing to explore ways expense put in to ensuring adequate Chancellor in his Budget. in which they can make projects economically protection from attacks. We also anticipate continued progress being viable on a subsidy-free basis and this, in turn, is Significant progress has still to be made in subsea standardisation to seek to spurring M&A activity. The development of new made around social for business and the enhance the economic attractiveness of small technologies (in particular, battery storage), customer experience. Things like Virtual pool developments/tie backs, and a further and the recycling of operational assets, suggest or Augmented Reality can have a positive decrease in capital expenditure, as previously a resurgence in corporate activity in the UK impact on improving the personalisation, sanctioned projects begin production. renewables sector. relevance and context of the connection with the customer. Social media allows businesses to build a better picture of customers and AR/VR will play an active role in this. A range of projects, supported by strong role models and mentoring, are contributing to a better balance of sexes in the workplace. Getting this in place will increase the talent pool available to Scottish businesses and make significant headway in addressing the skills gap. www.insider.co.uk December 2017 INSIDER 27 2018 PREDICTIONS

FINANCIAL SERVICES ENTREPRENEURSHIP

Lynne Cadenhead chair Women’s Enterprise Scotland/visiting professor of governance and enterprise, Edinburgh Napier

As Christine Lagarde, MD of the International Monetary Fund (IMF) said earlier this year: “The moral case for gender equity is clear, and so is the economic case...as countries around the Lindsay Gardiner world seek to grow their economies and reduce regional leader inequality, tapping into the huge potential of PwC Scotland women can be a game changer.” So, my prediction is that the tide is finally Three words will dominate the turning and that all the key players in the Scottish financial sector in 2018: Brexit, Scottish ecosystem genuinely recognise and collaboration and technology. These have value both the moral and economic benefits of been prevailing themes for 2016 and 2017 gender balance in enterprise. but the coming 12-18 months is where The refreshed Women in Enterprise things will become far more focused. Framework and the Scottish Government’s Brexit is the obvious one. As the final current Enterprise Review will reflect the drive shape of the UK’s exit position becomes towards a more innovative, collaborative and clearer we will see the financial sector forward-thinking enterprise support system, advising others but also looking to which will have equality and inclusion at its safeguard their own houses too. At this heart. It remains inexcusable that in this day and point, speculation on how a Brexit deal age, only 20 per cent of SMEs in Scotland are may look presents many branches of majority owned and led by women. possibility - something that is giving Growth in the economy will come from contingency planning teams a headache. entrepreneurs with businesses of all shapes, A year from now, the picture - by necessity sizes, sectors and stages of growth, from the of the 2019 deadline if nothing else - may innovative microbusinesses to the global small be a lot clearer. Financial services can businesses and the scale-ups, truly reflecting a untapped economic potential of women in adapt to changes if they know what they diverse and inclusive economy and society. enterprise – an additional £7.6bn contribution are: it’s the uncertainty beforehand that is There will be substantive year-on-year to the Scottish economy if women started the bigger issue. The concern for the UK, growth in the over 50s entrepreneurs, up businesses at the same rate as men – key and Scotland, is that more activities and particularly beneficial for the economy as players must truly accept that women face jobs are moved offshore. companies started by older people have a 70 distinct challenges in business, have been To ensure the Scottish financial sector per cent chance of surviving the first five crucial under-recognised and not given the support can stay at the forefront of innovation years, compared to only 28 per cent of those they need to date. it will require the second of the two key started by younger people. Support organisations and agencies must words: collaboration. The sector will need We will see a significant increase in the work together in a true spirit of collaboration the support of government, the education number of female-owned businesses starting to properly resource and support women in sector and professions to continue to up and pushing through gender-specific their entrepreneurial growth and aspirations, innovate and develop skills for Scotland growth challenges of the so-called ‘missing instead of focusing on hiding their failures and to remain competitive. The impetus the middle’ phase, shored up by a collaborative protecting their personal fiefdoms. industry and government now have ecosystem that delivers tailored support for Support organisations such as WES have supporting fintech and other digital women in terms of access to finance, mentoring advocated for years for a properly funded, developments can give us a competitive and networking and gender specific business strategic system to encourage more women advantage against other UK locations but support at all stages of their journey. into enterprise, but to little avail so far. we cannot afford to be complacent. The better sustainability of women-led Yet given the wealth of female talent, depth Technology is the key to customer and businesses will also provide a strong long-term and breadth of innovation, and strong business staffing transformation which presents boost for a prosperous economy. angel networks we have here in Scotland, we a real opportunity for fintech, supported We will also see the banning of the have an incredible opportunity to showcase through various agencies. Does this mean judgemental and inappropriate terms “lifestyle how Scotland leads the way in the drive for that the coming months are going to be business”, “oldpreneur”, “mumpreneur” and gender equality in enterprise. gloomy for financial services? I don’t think “fempreneur”. Risk and failure go hand in hand with so. It is one of the country’s best assets However, my prediction is nothing more than innovation and new ways of working. Yet I fear - it provides a significant trade surplus, hope. The stark reality is the polar opposite of we are too scared to take these risks. employs thousands and is a significant my prediction and unless activity starts now Where will be in five years’ time? Exactly contributor of taxation. It is an industry Scotland will sadly continue to lag behind other where we are right now unless radical changes that has continually - and successfully - countries in terms of female entrepreneurship. take place. There is no going back, the time for reinvented itself. The coming year will not If we really want to realise the significant action is now. be any different.

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FOOD AND DRINK

Joanna Fulton provenance’, will be in the spotlight as we enter partner 2018. At the time of writing the Supreme Court Burness Paull decision on the Scotch Whisky Association’s challenge to Scottish legislation on minimum I confess I turned to Google when asked to alcohol pricing is due on 15 November 2017. predict the food and drink trends for 2018. What And from the traditions of whisky to the mysterious prophecies would I discover, and novelty ingredients of today. One thing I’ve what if anything would I be able to relate to? noticed in the dishes I’ve consumed over the But it turns out, pretty much everything.That’s past year is increasing sensory appeal. the power of successful trend spotting – and We are seeking out foods with unusual and the basis for successful products and retailers. appealing colours, flavours and textures, and Knowing what consumers want before they even capturing and sharing these experiences by realise it themselves; spotting the seeds of an mobile and online. Think too of the food pages emerging trend. of the weekend supplements, with their carefully I like to know where my eggs come from. And crafted shots designed to get your taste buds my meat and fish. Come to think of it, fruit too. watering. I thought I was fussy. But products with proven Novelty is a significant factor in this, and provenance are increasingly in demand, ones chain issues in 2018, in Q1 next year draft EU producers and retailers will increasingly need with a local connection, natural ingredients, legislation will be published on improving the EU to scour the globe for exotic and distinctive produced sustainably and ethically. This gives food supply chain, seeking to address perceived ingredients. One legislative development in this Scottish food and drink a great advantage, as it is imbalance between Europe’s supermarket chains area is the EU Novel Food Regulation which will these high quality locally produced products for and food producers. come into force on 1 January 2018. This aims to which we are known. At home, consumers are predicted to demand simplify the EU authorisation procedure for novel The food and drink sector will continue to the same high quality provenance in a broader foods to enable innovative food to reach the develop supply chains in foreign markets where range of products not just the expensive market faster. there is untapped demand for premium Scottish premium ranges, so there is a growing need to And then there remains Brexit, the elephant brands. China is likely to be high on the agenda, develop distinct ranges and profiles for different in the room. Will 2018 bring the greater certainty with its growing middle class, willing and able to markets. that the industry is clamouring for? Now that’s sample new foreign foods. And to add to supply Whisky, Scotland’s most famous ‘product with real crystal ball gazing.

RETAIL and businesses have to continue to try to trade. visitor spend and to meet local aspirations. We Retailers have had a difficult time of it in 2017 need to ensure there is good, cheap space for and at this point there is little to suggest 2018 will local businesses to occupy. be any the better. In the last few days as I write The continuing penetration and evolving this, we have seen an interest rate rise (the first of nature and impact of the internet for retailing and several one suspects), the consultation about tax shopping points to the (r)evolutionary alteration rises in Scotland, and the weakest ever October to what we mean by, and expect from, retailers. non-food sales figures. Consumer spending is Add in societal issues such as healthy purchasing going to be challenged in 2018 and with retailer and consumption and environmental concerns costs rising (rates, employment, regulation) over food waste, plastic bags, deposit returns there undoubtedly will be difficulties ahead. This schemes and so on, and it would seem that the week has also seen the Whole Foods in Giffnock, expectations being placed on Scottish retailers go Glasgow closure announced, the Next half year well beyond being just locations to buy ‘stuff’. results be exceptionally poor and Marks and Leigh Sparks This agenda will be an emerging challenge Spencer trialling more store closures. Whilst some Professor of Retail Studies for retailers, consumers and policy makers in the retailers, often in quality fashion or in discount University of Stirling coming years. For some retailers it will be far more generally, have done OK, many remain worried. of a challenge than for others. IN WRITING an equivalent review for last year So, it is hard to be completely optimistic I focused heavily on the unfolding disaster of for 2018. There will always be winners and Retail thrives on footfall/visitor traffic and Brexit for the retail sector and the clouds of gloom losers, both on the ‘high street’ and online. The consumers need to be interested and excited and that had descended, and looked set to remain. continuing linkage of physical stores and places to feel they are getting value for their spending. One approach to this year’s review therefore is with online activities and shopping provides With constraints on consumer disposable income simply to ask readers to consult last year’s review opportunities, and entrepreneurial start-ups are likely to be maintained or exacerbated, this value – nothing is clearer and nothing has changed. identifying niches to be filled. Retail parks are for money requirement will continue to be an One year on and everything remains murky being reconsidered and revitalised and towns are overriding factor, even as retailers are feeling and unresolved. Brexit remains an existential grasping the redevelopment and concentration increased costs pressures. In such circumstances, challenge for many businesses, including some of retail opportunities. Redevelopment and quality will win out, but policymakers at all levels retailers and their supply partners. enhancement in cities around Scotland hint at the can help by seeking to attract people to places, However, as with all things Brexit, life goes on potential that retail has to capture the increased events and shopping locations.

30 INSIDER December 2017 www.insider.co.uk 2018 PREDICTIONS

PROPERTY

Lorraine Macphail are moving in the right direction but more radical head of property and construction in Scotland action may be required if we are to return to the Grant Thornton record levels of investment in affordable housing witnessed in the 1970s. One move, which is sparking a lot of interest is the push towards the Private Rental Sector. PRS offers investment In Scotland’s property and construction opportunities for developers, while initiatives sector, there is a sense of deja-vu about 2017. The such as the Rental Guarantee Scheme eliminate last year delivered a real political and economic some of the risk involved. shock to the country as we grasp the prospect of Greater dialogue is also required between the Brexit and try to understand what it all means for private and public sector to discuss the impact businesses. of taxation reform in areas such as the Land We’ve been here before. The global downturn and Buildings Transaction Tax. Early evidence of 2009 hit construction harder than almost any suggests the tax has provided a shot in the arm other industry. The sector bore the brunt of the for first-time buyers, but it is also acting as a crash with stalled projects, job losses and an disincentive to the higher end of the market, end to wage growth. To some extent, it means which could create an imbalance and generate that the industry is now in a stronger position to new issues for the property sector as it struggles weather the storm ahead. Lessons were learned market, but – despite that buoyancy – the with a combination of challenges. and industry leaders ensured action was taken to number of new developments coming on to the It would be unreasonable to suggest that offset any future crisis. market remain at near record low levels. In the contingency planning is not taking place right That said, no amount of contingency planning coming months, we could start to see some of now. Across all aspects of the property and can completely insulate the sector and there the effects of interest rate rises. As it stands, the construction sector, firms are exploring what remains real concern that a no-deal departure market has responded positively to the phasing action may be required to minimise the damage from the European Union could leave property of small increases and reassurances from political that could be created if we witness a growing and construction vulnerable – especially in leaders that rates should not rise above three per skills shortage or access to funding becomes areas like funding support for speculative cent in the next decade. increasingly complex. The coming months will developments and access to skilled migrant Much has been said about the lack of not be easy for any sector, but there is hope that workers – both essential elements if the industry affordable housing and action is slowly starting Scotland’s property and construction firms, who is to continue to regain lost ground. to be taken to address this long-term chronic collectively employ more than 230,000 people, Demand from both homebuyers and the challenge facing Scotland. In 2018, we need to have learned from previous crises and are in a commercial market have helped to rebuild see greater collaboration between developers, strong position to plan for future, long-term, resilience and strength in the Scottish real estate buyers and renters, politicians and landlords. We sustainable growth.

www.insider.co.uk December 2017 INSIDER 31 2018 PREDICTIONS

SMEs

Jamie Grant growth and we will be maintaining our proactive head of corporate banking approach to supporting ambitious businesses Barclays in Scotland who wish to develop, expand and innovate through our SME Fund. October brought a five-year high in inflation, It will also be interesting to monitor how November a rise in the base rate from the Bank the consultation on the Scottish Government’s of England, so what will the New Year bring? One proposed Scottish National Investment Bank thing is certain - SMEs will be watching the effect develops, with its broadly welcomed aim of the rise in interest rates has on their costs as we investing in start-up and growth businesses move into 2018. to support R and D, capital investment and Generally, the world economy is looking internationalisation. stronger and the investment market is more As with every New Year, there comes optimistic about prospects for the year ahead, challenges as well as opportunities. Cyber due in part to the steadily rising oil price which security is high on the agenda for many of is seeing the north east oil and gas sector find Scotland. We are seeing overseas M&A interest our SME clients and is likely to remain there its feet again. It’s not just a boost for the global in some of our bigger food and drink businesses for the foreseeable future. We are supporting players, but also the region’s many SMEs that while innovative artisan producers are on the our customers with practical help and advice relied so heavily on the resulting income from increase including a raft of new whisky and gin to protect themselves and, in turn, their own companies and employees. distilleries. A muted performance from Sterling customers’ businesses and data. We are seeing new opportunities emerging into the New Year spells good news for exporters And speaking of data, there remains for support services such as engineering who are able to take advantage of the ongoing uncertainty around the forthcoming GDPR but we’ve also been speaking to a wealth of demand for Scottish provenance and the regulations which come into force in May but it SMEs from a more diverse range of sectors – competitive advantage the favourable exchange is a vital consideration for any company which hospitality and food and drink to name a few. rate affords. handles client data. A definite must to add to The latter sector continues to flourish across Access to finance is a crucial driver of SME that list of New Year’s resolutions.

MANUFACTURING

David Watt executive director IoD Scotland

to move Scotland’s economy forward as a whole. Scotland is doing fantastically well in growing Predicting the next 12 months for our international offering in food and drink, manufacturing is a very difficult task.T he rate and this will continue. But other sectors can of exchange is a key factor, and is very volatile. get on board with globalisation too, especially Brexit discussions seem to be varying from manufacturing. “Made in Scotland” is harder to easier day by day, and exchange rates almost a seal of approval to many international are following this trend. Some businesses will markets – it says quality, care and heritage. benefit significantly from this, while others will Manufacturers should capitalise suffer. on that. Manufacturing companies that plan for the Exporting can seem daunting; red-tape, fluctuation, keep their eyes open to opportunity, uncertainty and economic instability are all and focus on being resilient, will thrive in these risks that companies must consider. However, conditions. I would encourage businesses to seek out the We have seen an upsurge in businesses guidance and advice of those who are already bringing processes which have previously been exporting internationally; we have an incredible carried out offshore back to a local level. I believe network of support and success across Scotland’s this will continue to be the case and we will see businesses. more and more companies bringing production positively towards global markets. As a small country on the geographical back into the local space, as the opportunities For manufacturing companies to grow periphery of Europe, international trade is for guaranteeing high quality home-grown strategically, internationalisation really should Scotland’s lifeblood – our heritage and our production become clearer. be high on the agenda. Not only is it where the future. We must encourage manufacturing I also hope some smaller companies will market lies, but also where the competition is. companies to internationalise like never before look internationally and export if they don’t In Scotland, only 10 per cent of our businesses to ensure that uncertainty – and Brexit - does already – firms should capitalise on international are currently exporting – if we encourage not leave us marooned in the North Sea. I am opportunities, and should be using Scotland’s manufacturers to look to the global market and optimistic for manufacturing in 2018, despite the worldwide diaspora and connections and look pursue international opportunities, we can work many challenges which lie ahead!

32 INSIDER December 2017 www.insider.co.uk 2018 PREDICTIONS

TALENT TOURISM

Professor J John Lennon director Moffat Centre for Travel and Tourism, Glasgow Caledonian University

Tourism in Scotland in 2017 benefitted significantly from the ongoing decline in the value of sterling against the Euro, US Dollar and other major currencies. This has made Andy Rogerson both Scotland and the rest of the UK a value director destination for many inbound tourists from Livingston James key international markets. Full Scottish tourism performance data for 2017 is as yet unavailable Big Data; Artificial Intelligence; machine but interim reportage suggests buoyant learning were the buzz phrases for 2017, accommodation occupancy, strong room rates but not topics you would immediately and good growth in attraction visitation. associate with recruitment. Social media Whilst this increase in visitation is on the other hand has been a theme undoubtedly helpful, one is left with the for a little bit longer. There is an ever- impression of an industry gazing over a cliff. expanding plethora of online networks, The performance of Sterling is undoubtedly making everyone visible in the digital linked to the ongoing impacts of the Brexit age. We predict that accelerating digital negotiations and the continued economic technologies will begin to transform the uncertainty this has catalysed. Furthermore, the to maintain margins without increasing prices. recruitment industry again in 2018. shadow of terrorism and safety in a range of Fuel cost rises remain a concern for 2018 and It probably went unnoticed to many competitor destinations also plays a part. the cost of internal Scottish travel, which that in the latter part of 2016 Microsoft The Brexit process and its economic impact remains predominantly car-based will become spent $26bn acquiring the mainstream shows no signs of abating. As a consequence, more expensive. The problem here is the appeal career platform LinkedIn. This platform in 2018, Scottish tourism will continue to of highland, island and rural destinations when has more than 500 million members - 20 see strong visitation from domestic and access costs rise. million in the UK. That’s 58 per cent of international tourists as Sterling continues to The continuing access uncertainty and our working population. With more than face pressure in international money markets. A the possible reintroduction of visa access to 40 per cent of users active on a monthly weakened Conservative Government following the UK (and into the EU 27) will impact on basis, this is a system that can generate a the UK elections has not calmed continuing both outbound tourism and inbound leisure lot of Big Data. Where do we work, what concerns about trade, import tariffs, air access and business visitation. The issue is that the are our skills, how often do we change or customs issues. Whilst these matters do not important EU leisure and business markets may jobs, what sorts of jobs are we looking become acute until the Brexit deadline in March well plan to holiday and meet amongst the for and so much more. 2019 they should be resolved as a matter of remaining 27 more easily accessible EU nations. The game changer is the rise of the urgency. The availability of labour working in the millennials and Generation Z. By 2020, 50 Scotland in 2018 will remain an appealing tourism and hospitality sector is now becoming per cent of the workforce will be made destination for both international and domestic acute and this will continue into 2018. The free up of millennials – a workforce who don’t visitors. In the case of domestic visitors; most movement of labour Scotland experiences as want to have to adhere to traditional importantly English and Scots the ‘staycation’ part of the EU has in the past ensured a supply workplace constructs. And Generation Z, demand will continue. The growth in UK tourists of migrant workers for a range of sectors. The by 2021, will make up 20 per cent of the holidaying at home is a proven response to impacts of weaker earnings (UK Sterling value workforce - such is the pace of change, economic uncertainty and currency weakness decline) and uncertainty about future residence 65 per cent of the jobs that they will overseas. Whilst for many UK citizens the has catalysed labour shortages. This is very perform do not exist yet. primary overseas vacation is likely to continue, it evident in food production areas (and other With Microsoft behind them, LinkedIn is the second (international) break that becomes parts of the Scottish hospitality sector) and the and similar platforms will increasingly more questionable and herein lies the on-going impacts are being felt in rural, island and urban be able to provide the data that explains ‘staycation’ potential for Scotland. destinations. the preferences of the next generations Continued concerns over perceived security The outlook for 2018 suggest that tourism of workers – a generation who are issues in international destinations increases gains in terms of the Scottish/UK value demanding new careers and career the appeal of a relatively secure Scotland. In proposition and ease of access will continue models. the case of the critical European and other (at least for 2018). However, uncertainty about Where talent has become more international leisure and business visitors the Brexit negotiations will cast a shadow over mobile and autonomous, with key skills value proposition has appeal in tourism, retail, buoyant demand for both leisure and business increasingly in short supply, the smart hospitality and travel. tourism sectors. The inability for customers to organisations will be those that grasp In the immediate term, there are a number plan with certainty beyond 2018 will begin the new data that’s coming and use it of areas of concern that will continue. Food to impact and price rises in imported goods, to inform a people strategy that ensures price inflation is greater than official inflation increasing labour shortages and access that they compete effectively for talent rates and hospitality providers are struggling concerns will continue. in the digital age. www.insider.co.uk December 2017 INSIDER 33 MARKET COMMENTARY SURE FOOTING IS REQUIRED ON A ROCKY ROAD AHEAD

2018 will be a pivotal year for the UK and hard to predict and a myriad of factors can increase Scottish economy. The top priority for or decrease consumer spending. Needless to say, Government has to be agreeing what the consumer spending alone does not lay a solid transitional period for exiting the EU will look foundation for sustained growth. like and how long it will be. This also raises questions over further interest An arbitrary deadline of 31 December appears rate rises. Savers may rejoice after a decade of rate to have been set by many financial institutions, cuts, but there’s a risk that once a rise plays through and if we get to 1 January with little or no progress to mortgage rates household spending could made on the transition many firms are likely to be squeezed further and the wind taken out of announce contingency plans which for some will consumer confidence. involve moving jobs out of the UK. We need to see We can’t rely on consumer spending to prop the pencilling out of trade deals with EU-27 and rest up the economy indefinitely. The real challenge is of the world. productivity. Increased productivity will start to lift Whatever negotiations in Brussels determine, other aspects of the economy, including investment growth and productivity need to be addressed. For and trade. Digital and tech industries have the ability the last few years apprenticeships have taken centre to turbo charge economies (think California with an stage, and rightly so, but I think 2018 will be the year economy larger than France). of the great productivity debate. Productivity issues Craig Vickery 2018 will see a number of big anniversaries. should keep skills front and centre of the minds of Given it will be 10 years since the fall of many-a-big- politicians and not just the worthy target of 30,000 disruptor, are arguably harder to monitor than bank it is a good time to reflect on current practices apprentices by 2020. output from a car factory for example. There is (especially in light of Paradise Papers). Ethics and Productivity remains an Achilles heel for a strong case behind this argument and this is ethical standards are absolutely vital for business. the UK economy. Productivity has more or less something that economists, policy makers and Not only doing the right thing because we have to, flat-lined since the financial crisis and is pushing industry leaders will need to work out. but because we should and because we want to! down real-term wage growth and, in turn, living Accountants sometimes say ‘if it can’t be Scottish tax powers will continue to influence standards. Recent growth figures may have shown measured, it can’t be managed’ and this mantra business. By the time this goes to press we will have that productivity was perhaps not as bad as was applies to the evolving digital economy. We need to more information on any Scottish tax changes. I thought, but it’s still not good enough. We must effectively measure productivity in the non-tangible trust that our politicians at Holyrood are considering start to question how the digital revolution, artificial outputs of the digital world so we can better the business impact of any tax changes – ensuring intelligence and automation can be used to boost understand the real performance of our economy. that we grow taxation revenue rather than headline productivity. The challenge on growth centres around the way rates. Commentators have raised valid questions on in which the economy has grown. As has been the Political uncertainty will continue, whilst IndyRef2 whether long-standing productivity measures story for the past year or so it’s consumer spending may be temporarily off the table UK politics remain are picking up growth in the digital economy. that is driving growth, not new investment or trade. precarious. Another general election is unlikely, but Transactions made via Airbnb, or a new FinTech This is deeply concerning as consumer behaviour is you wouldn’t bet against it.

For more information contact: Craig Vickery, FCCA CA Head of ACCA Scotland ACCA, 110 Queen Street, Glasgow G1 3BX E: [email protected] T: +44 (0)141 534 4072 www.accaglobal.com REPORT: THE BUSINESS of SPACE

SPACE BECOMING AN OUT OF THIS WORLD SCOTTISH SECTOR By Kristy Dorsey increasing commercialisation drives Above: the ‘Clean Edinburgh-based Vert the development of a new age of Room’ at Clyde Rotors makes ultra-compact gas he business of space is, by space applications. Space compressors whose design has won its nature, ordinarily out of Tipper – whose work on the numerous accolades for innovation, this world. But as proponents Intergovernmental Panel on Climate including recognition at the 2017 Tof the burgeoning sector in Change (IPCC) was recognised as a Insider Made in Scotland awards. Its Scotland are keen to point out, it contribution to the Nobel Peace Prize compressors are designed for use in generates tangible benefits right here in 2007 – concedes it is “doubtful” the situations where vibration and noise at home. space industry in Scotland will ever are not acceptable, such as medical Nobel Laureate Richard Tipper reach the size of, for example, tourism and aerospace applications. is chairman of Edinburgh-based Olly Dmitriev, who founded Vert Ecometrica, which he describes Rotors in 2013, says the company is as the “Netflix” of satellite data. It is all about technological capability. currently working on applications in Employing 40 people in Scotland, space detection systems and satellite London, the US, Canada and Mexico, The space sector is at the top end propulsion. He says the space sector the company has created a central is a great way to showcase Scotland’s point where the users of space- of the pyramid in that sense. If you talent on the world stage, and will derived data can access information boost business opportunities for in a practical format based on the aspire to have high-tech industries, it many Scottish companies across a analysis of satellite images. Some of number of industries. this analysis is done by Ecometrica, is important to nurture that high end “There have been many instances but the majority comes from a range Richard Tipper, Ecometrica (below) when innovations designed for space of other sources. exploration have had tremendous The space sector in Scotland north of the Border. However, it impact much closer to home,” employs about 5,500 people and brings the country kudos at the Dmitriev says. “Think of enriched had an estimated turnover of £134m highest end of the value chain. food, now used as baby formula, in 2012/13, according to a study “It is all about technological or freeze-dried foods, which were published at the end of 2016 by capability,” Tipper says. “The space initially created for space travel. London Economics and Scottish sector is at the top end of the pyramid “By boosting the number of space Enterprise. That represented 1.1 per in that sense. If you aspire to have innovations in Scotland, we have cent of the total UK space economy, high-tech industries, it is important to the opportunity to create many a figure that is expected to grow as nurture that high end.” new products which will sell in the www.insider.co.uk December 2017 INSIDER 35 REPORT: THE BUSINESS of SPACE

UK and abroad. It will boost our economy and create many skilled Sentinel-1 (image: ESA) manufacturing jobs.” With industries as varied as communications, health, energy and environmental monitoring looking skywards for answers to some of their most complex issues, the commercial value of data gathered from outer space is only beginning to take off. That data is collected by satellites made by companies such as CubeSat specialist Clyde Space and PocketQube start-up Alba Orbital, both based in Glasgow. At the other end of the value chain are companies like Ecometrica and Musselburgh- based Astrosat, who find and analyse data from those satellites, turning it into useful information. With the ability to collect information globally, and on a daily basis, images from outer space can detect activity in areas hard to reach on Earth. This could be illegal logging in the middle of a rain forest, or tiny movements in subsea pipelines. Very small shifts in buildings and landscapes are difficult to detect, but combined with the right software, fivefold jump in profits during its satellite images can monitor for With the data and information we can latest financial year to the end of minor movements daily. Slight shifts March, which rose to £218,000 in offshore wind turbines or subsea garner, we can help countries and against £45,000 previously. pipelines are a precursor to bigger Clients include governments from problems which, if detected early on, communities which are at the mercy around the world who use the can be dealt with more effectively and platform to safeguard their natural at lower cost. of unscrupulous operators environments. Corporations such as Steve Lee, Astrosat (below) According to Astrosat, there is mining companies are also coming no challenge on Earth that can’t be around as they look to increase assisted or solved with space. Its of unscrupulous operators. their transparency on the social founder, chief executive Steve Lee, “This, in effect, brings space – and and environmental impact of their set up the business in 2012 as an space companies and organisations – activities. “ideas factory” to take data from into the FairTrade arena, by helping Tipper says there is a growing space and create something that can local farmers and villagers to manage realisation that “space observation is be used commercially across a broad sustainable timber reserves. Illegal a powerful tool” that can be leveraged spectrum of industries. logging not only undercuts markets, across a variety of sectors. While the Much of what the company does but has a devastating effect on vital company’s platform has to date been involves tackling truly global issues. ecosystems.” used predominantly for agricultural In Guatemala, for example, Astrosat The application, known as FMAP purposes, Tipper and his three co- is developing a revolutionary method (Forest Management and Protection), founders – who set up the business in for stopping the illegal logging trade. can monitor particular types of trees 2008 – are hoping to move into water Described as “CCTV in the sky”, to ensure that only permitted timber resource management in a much the technology is the result of a felling is allowed, creating a legal bigger way in the coming months and collaboration with UK and US-based market for sustainably-managed years. Earth Observation Ltd. It allows law forestry products. This helps ensure Part of the challenge for enforcement agencies to take action fair use of the natural environment, Ecometrica and others who supply against offenders in Guatemala, which is regarded as paramount similar information is distinguishing where forests cover one-third of to sustainable economic growth in between seasonal changes and long- the land area and illegal logging is a a country where three-quarters of term alterations brought about by widespread problem. the population live on or below the human activity. This is one example “What we are working on here poverty line. of the analysis required to generate could be described as a CCTV system It’s this kind of work that is driving usable information from data such as which operates from space,” Lee says. huge growth – though admittedly satellite pictures. “With the data and information we from a small base – across space- Firms like Ecometrica are fairly can garner, we can help countries and related firms in Scotland. agnostic about what types of satellites communities which are at the mercy Ecometrica posted a near- their data comes from, or how that 36 INSIDER December 2017 www.insider.co.uk REPORT: THE BUSINESS of SPACE equipment gets into space in the by improving the level of information space by “piggy-backing” on other first place. However, those who available to those working in sectors launches. They can do anything from manufacture craft, subsystems and such as energy, sustainable cities, monitoring the health of oceans to components – one of the main smart grids, agriculture, marine, life investigating the potential for mining strengths of the Scottish industry sciences and transportation. on asteroids. – are keeping an eye on continuing Macdonald says being part of The turning point for Clyde discussions to establish the UK’s first the network allows SoXSA to offer Space came in 2014 with the spaceport by 2020. a range of support to Scottish- successful launch of UKube-1, which British firms have traditionally had based businesses that would not triggered a substantial advance in to rely on the launch capabilities of otherwise be possible. Each centre the performance and reliability of other countries, which brings with it has complimentary skills as well as its small satellites. It went up on the extra costs and logistical difficulties. own geographic area to look after – Russian Soyuz-2 rocket launched For example, the launch of Clyde the East Midlands, for example, has a out of Baikonur Cosmodrome in Space’s UKube-1 – the first satellite strong history in navigation. Kazakhstan. ever fully assembled in Scotland – out Scotland boasts the upper hand in Clyde Space is currently building of the Baikonur Cosmodrome in smaller, lower-cost satellites which 12 satellites for six missions, but Kazakhstan was delayed for various Macdonald argues are leading to the by 2020 it hopes to be producing reasons by nearly 12 months. A “democratisation” of space, which constellations of 50 to 100 small dedicated base for space-planes used to be dominated by superpowers satellites that will operate as networks would give the UK industry end- wielding vast budgets and large in space. to-end control of the value chain, populations. And just as social media Alba Orbital, a start-up founded and has a good chance of coming to has turned the internet into a two- by Tom Walkinshaw in his bedroom Scotland. way street of information, the future in 2012, recently moved to a larger The UK government announced in of the space industry lies in increased office in Glasgow’s Oxford House to June that legislation for commercial interaction with assets in orbit. accommodate its expanding team. space flight will be introduced over Set up in 2005 by Craig Clark It now employs 10 people across the the next two years, with the aim of – a graduate of the universities of six core disciplines required to build helping the UK increase its share Glasgow and Surrey who spent 11 PocketQubes, which began life as a of the global space economy from years employed as a power systems concept devised by professor Bob 6.5 per cent to 10 per cent. Scottish specialist – Clyde Space designed Twiggs of Morehead State University locations featured heavily among and manufactured Scotland’s first in the US. potential sites previously discussed: spacecraft, a “CubeSat”, for the UK They are small standardised units Campbeltown, Prestwick and Space Agency. that come in different sizes - “1P” Stornoway have all been mentioned, These small standardised systems refers to a 5cm sq cube, “2P” is though the current front-runner operate in low orbit, are far cheaper 5cm x 5cm x10cm, and so forth. appears to be the A’Mhoine peninsula than custom-built satellites, and reach The different sizes allow different in Sutherland. missions, and if the payload for a Craig Clark, founder of But there are questions of whether Clyde Space mission won’t fit, the satellite can be the commercial space flight project extended. will go ahead, as the government Working in partnership with is proposing to remove the €60m the European Space Agency, Alba (£53m) cap on operators’ liabilities Orbital is planning a pilot launch of per satellite in the event of an its Unicorn-1 picosatellite, which is accident. Without an upper limit, “ready to go”. Work is now focused on payouts could be too costly, leading the larger Unicorn-2 model. space operators to look outside the Walkinshaw says the firm is on UK. course to hit revenues of £300,000 in As the head of the Scottish the current year, with buyers coming Centre of Excellence in Satellite mainly from the national space Applications (SoXSA), Malcolm agencies. However, there is growing Macdonald hopes to help usher in interest from SMEs and start-ups an era where spacecraft are regularly seeking cheaper access to space, and launched from UK – and preferably the benefits to be had from beyond Scottish – soil. Among other things, the atmosphere. this would benefit smaller satellite This has provided the foundations companies by providing options for for a fledgling industry that didn’t low-cost and reliable access to space. exist in 2012, when Walkinshaw came Set up in 2014, the SoXSA hub out of university intent on a career at Strathclyde University is one of in space, but could find no local five centres of excellence run by the employers. Satellite Applications Catapult, the “The sector has grown a lot from others being in Durham, Leicester, what was really just one company five Portsmouth and the Goonhilly Earth or six years ago,” he says. “Obviously Station in Helston, Cornwall. The the growth in the number of aim of the network is to develop new Brazil viewed from space (image: ESA) companies has been great, but to be concepts for the exploitation of space honest, it still has a long way to go.” ■ www.insider.co.uk December 2017 INSIDER 37 CHARITY PROFILE: NSPCC

or Matt Forde, national information to parents, families head of service for the and professionals. Adults can NSPCC in Scotland, the run- use the confidential service to Fup to Scotland has both its highlight concerns about a child – bad points and its good. anonymously if they wish – who “The lead-up to Christmas can be they think may be being abused or a difficult time for children,” he says. be vulnerable. “For those who are in families with The funding of these key services difficulties it can be a really poignant and the direct services they provide time where they can feel very alone. at the NSPCC Glasgow Service It can be difficult for parents who Centre in Govan is done through themselves did not have good donations from individuals and experiences as children, as well as from other charitable funds and for the children. foundations. “But it is also a very good time to Forde says: “Ninety per cent of raise awareness of the work that we our funding comes directly from do and our fundraising campaigns. charitable giving. That means It gives us the opportunity do a lot of that we as an organisation can be stuff to try and gain support for our completely independent to give campaigns of work with children.” the help that is required where it is NSPCC is partnering with required.” communities all over the UK on NSPCC has a UK-wide turnover the switching on of their Christmas of £120m with the Scottish share of lights, with the most prominent that being lower than the relative being the world renowned population share. Christmas Lights display on Oxford Forde says that means that Street in London. there is potential for the Scottish The campaign is a new one so it contribution to grow to increase the is difficult to judge how important work with children and families that it will be but Forde believes there is they are able to do. a huge potential in the partnerships The charity is currently investing with cities and towns switching on about £5m a year on its work in Christmas lights all over the country. Scotland which includes Childline Forde says: “Christmas can be and Helpline operations here and Matt Forde, NSPCC a time when children who are the Glasgow Service Centre. experiencing problems become NSPCC, which is registered as increasingly anxious and lonely and a charity both in Scotland and Childline can often be their only NSPCC CALL England and Wales, is seeking to source of advice and comfort.” raise more funds so that all of the Forde says that the NSPCC is calls to Childline can be answered. aware of the scale of the problem. It is also seeking to partner with “There is a big gap between the FOR BUSINESS businesses and other organisations number of vulnerable children to work together to help vulnerable who are known to the services that children. can help them and those that are SUPPORT Forde says: “We really want to not known. The research shows work with others. So we are open to that for every child that is known partnerships with business, public to professional services there are TO HELP sector organisations, other charities another eight who are not known.” and other charitable fundraising Childline is the free, private and groups to work together on these confidential phone service that VULNERABLE vital issues.” ■ NSPCC runs which children can contact either by calling on the phone or by contacting it online. CHILDREN You can text NSPCC 4 to 70800 to It also runs the NSPCC Helpline donate £4 today and help Childline which produces help support and By KEN SYMON answer every child. 38 INSIDER December 2017 www.insider.co.uk IN MY VIEW: IAN RITCHIE

AWARDS’ INTERNATIONAL FEMALE ROLE MODELS BEG A QUESTION

ack in 1989, I was chairman of the The judging is a well established process and Scottish Software Federation, the then the seven or eight judges, all senior engineers nascent trade association for the Scottish from organisations such as Amazon, BCS and Bsoftware industry. Nowadays it is known Microsoft meet and read the submissions and mark as ScotlandIS and represents an industry which each one under a number of key criteria: Level of employs more than 90,000 skilled people and adds Innovation; Planning & Organisation; Technical £4.5bn to the Scottish economy. Difficulty; Commercial/Social Relevance; Quality But back in those days we were pretty small of Presentation; Level of Knowledge of Previous and insignificant and we were keen to organise Research; Quality of Engineering. a new awards competition to raise our visibility. Each of these factors is scored out of ten and then We decided to create an award to recognise young added up; providing an initial order which we then people entering the profession. discuss. If there is a major discrepancy between the We asked each university in Scotland with a judges on one or more of the criteria we discuss Computer Science course to send us their best final whether there has been a misunderstanding and try year project. All universities require their students to resolve the matter and achieve an agreed position. to undertake a major project in their final year and Because this process is scored under these various these make a substantial contribution to the grade criteria the results tend to be pretty objective. The that will be awarded to the graduating student. students’ names are on the projects but we don’t tend to notice them – it is the quality of the content of the projects that, literally, counts. I employed the very first YSE winner and the So this year, only when we had decided on the top four candidates, we discovered that all four were last time I saw him he was driving a yellow female. This was an interesting outcome since the percentage of females studying computer science in convertible from our Seattle office the UK is only around 14 per cent - it is a very male- dominated profession. We called it the Young Software Engineer of the So it was refreshing to be able to celebrate the fact Year Award and it has been running ever since; that a software career is a superb one for women. It this year the winners were announced at an awards is well-paid industry without many of the traditional dinner on October 5. I’ve been chairing the judging hierarchical structures that you often find in older session for the last 28 years and it is always a huge businesses. pleasure to see how these final year projects respond However, another aspect of this situation that to the changing world of computing. These days we also noted is that all four winning students they tend to be on topical areas such as novel user are international students – from Serbia, Malta, interfaces, mobile apps, artificial intelligence and ‘big Singapore and France. d a t a’. Which begs the question – what can we do to It’s a great award to win and provides an excellent encourage our young Scottish females to follow springboard on which to launch a career in the their lead and pursue an exciting career as a software software industry. I employed the very first YSE engineer? ■ winner and the last time I saw him he was driving a yellow convertible from our Seattle office. This year’s winner, Gala Malbasic, flew up specially for the Ian Ritchie is a leading businessman who advises start-up technology companies. evening from London where she now works at the financial publishing giant Bloomberg. www.insider.co.uk December 2017 INSIDER 39 BREXIT: THE HOME FRONT THE BREXIT negotiations between the UK and EU treaties (e.g. trade agreements) to which the UK would are being widely reported in the media and closely no longer be a party. They may also require decisions, followed by business. Journalists have also been enforcement or administrative support that is currently reporting on the European Union (Withdrawal) Bill, provided by EU institutions such as the Commission, or which is currently the subject of heated debate in agencies like the European Medicines Agency. the House of Commons, however the Bill has been The Bill therefore empowers the Government to receiving less attention from business than it should. remedy ‘deficiencies’ in retained EU law to ensure The Bill is very technical and has sparked great that the law will operate effectively within the UK debate among constitutional lawyers, academics and post-Brexit. politicians. Its complexity makes it inaccessible to many While the concept of ‘deficiency’ suggests the powers others, but its importance can hardly be understated; in the Bill should be technocratic, and intended only to it is perhaps the most important step to be taken by resolve practical difficulties, their use may well prove the UK Parliament to give effect to Brexit within the controversial. Those powers could create new public UK. (While it has recently been announced that the bodies and give new powers to existing UK authorities. final UK-EU withdrawal agreement will also be put Where EU rules would no longer make sense, they into an Act of Parliament, this will simply be giving may well have to be replaced with something else. effect in UK law to whatever has been agreed by the There are also significant disputes between the UK Government – essentially giving Parliament a ‘take it or Government and devolved administrations about who leave it’ choice.) should have control over certain aspects of retained EU The Withdrawal Bill is chiefly intended to ensure law post-Brexit. These issues will require substantive continuity and certainty for individuals and businesses, policy choices, over matters such as the identity and by ensuring that EU laws applying in Britain now will powers of regulators, which could have significant Christine O’Neill, Chairman at Brodies LLP, and continue to apply after Brexit, but as part of ‘domestic’ consequences for businesses. Charles Livingstone, Partner, are both experts UK (and Scots) law (as a new concept called “retained The UK Government and devolved administrations in constitutional matters. EU law”). are currently working out what changes they will However, the Government has recognised that need to make to EU law to ensure stability after Brexit. www.brodies.com certain parts of EU law simply ‘won’t work’ after the Businesses should ensure now that they understand UK leaves the EU. EU laws may provide for reciprocity how their regulatory environment could change, and between Member States, which would not make engage with government to make sure their interests sense if there is no agreement on those arrangements and concerns are taken fully into account in ensuring as continuing. They may give effect to international smooth a transition as possible.

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brodies.com REPORT: BREXIT UPDATE

BREXIT Arguments RUMBLE ON AS BREAKTHROUGH IS STILL AWAITED By Ken Symon

s we come to within armageddon’ predicted by some on The paper says: “The divergence shouting distance of the Remain side in the referendum that immediately followed the year end what is perhaps has not come to pass there are signs referendum is quite a bit larger than Astriking is what has not that the vote and the UK’s impending that observed for all goods, and happened in relation to Brexit than departure is already having an becomes larger when amplified over what has. impact on the economy beyond the time. This has important implications There has not been the level exchange rate. Research by three for how the vote has affected the of taking shape of the future academics from the London School purchasing power of different income relationship between Britain and of Economics, Josh De Lyon, Swati groups. Low income households the European Union that we would Dhingra and Stephen Machin shows spend a higher proportion of have expected and the dire economic that inflation in the UK has risen their income on food than rich consequences predicted by the households.” Remain side and by the majority of So the evidence is that the economists have not – yet – come to We are working hard to ensure that economic squeeze is being felt more pass. strongly in some parts of society As I write this there has still not we have a balanced diverse business rather than others but it is an effect been the breakthrough between the that has a circular process of not that is likely to have increasing two sides which would have allowed economic consequences. It is an irony the “sufficient progress” required by only goods coming into the business that the groups who voted in biggest the EU to allow the negotiations to numbers for Brexit will be the ones proceed onto the next stage beyond from international markets but goods who suffer most. the initial three issues of the ‘divorce However, the biggest questions – bill’, the treatment of EU nationals flowing out to international markets over the shape of the ultimate deal, and the Northern Ireland border Chris Miller, Craft Beer Clan of Scotland (below) or lack of it, between the UK and issue. the EU – still remain. What will The biggest economic effect of happen when we do get beyond the Brexit is still the drop in the value of faster than the eurozone since the current impasse (at time of going the pound against both the euro and referendum with price rises varying to press) and the talks on the trade the dollar, an outcome that has had across sectors. arrangements begin in earnest? a large range of positive effects on Their research shows that the rise As this issue of Insider went some business and negative effects in the growth rate of food prices has to press there was much talk in on others with some finishing off just been particularly pronounced. As a government and civil service circles about even. result, real wage growth in the UK of a “Canada plus” agreement. But while the ‘economic has again turned negative. The suggestion is that what will www.insider.co.uk December 2017 INSIDER 41 REPORT: BREXIT UPDATE emerge is an equivalent – albeit added to – of the EU-Canada Comprehensive Economic and Trade agreement, or Ceta to its friends. There is evidence of this kind of agreement being supported on both sides of the talks. David Davis, the Brexit secretary said last year that this would be a “perfectly good starting point” for discussions about future UK-EU trade relations when we get round to that point in the discussions. In October Michel Barnier, the EU’s chief negotiator said that as soon as he knew the UK would be out of the customs union and single market “we will have to work on a model that is closer to the agreement signed with C a n a d a”. But such an approach has its critics. Nick Clegg, the former Liberal Democrat leader, writing in The Financial Times warns: “A Brexit secretary David Davis and European Canada-style agreement might sound chief negotiator for Brexit, Michel Barnier seductive, but it would be an act of hold a press conference after their meeting reckless protectionism that must be in Brussels, Belgium in November resisted at all costs.” He argues: “Compared to the Canada-plus arrangement – although unfettered trade the UK now has Uncertainty arising from the UK I suppose it depends on how strong with the EU, the Canada model – a Government decision to leave the the plus is. Nor was it membership much narrower trading arrangement of the European Economic Area – would mean erecting new barriers European Union is already having because membership would mean to business.” the UK having to abide by EU rules Clegg warns that this would lead to negative impacts on these life without being able to affect them. a programme of re-regulation and re- Whether her view triumphs will protection of trade to an extent not sciences companies in Scotland, and depend not only on the progress of seen since the damaging introduction the talks but also on whether she of new tariff arrangements in the the concern is set to intensify can continue as Prime Minister. 1930s. Dave Tudor, Life Science Scotland (below) Again as I write there has been more Clegg points out that Ceta largely dissatisfaction with her leadership focuses on goods not services but She went on: “As for a Canadian with reports of 40 Tory MPs he points out that services are “the style free trade agreement, we being willing to sign a letter of no lifeblood of the UK economy”, should recognise that this is the confidence. accounting for 80 per cent of gross most advanced free trade agreement The question is whether she will domestic product – in Scotland it is the EU has yet concluded and a continue held in place because of 75 per cent. He also points out that breakthrough in trade between the political balance within the UK trade with the EU is eight times Canada and the EU. parliamentary Conservative Party larger than Canada’s. “But compared with what exists and the fear of the Government What is striking about the re- between Britain and the EU today, falling and the prospect of a Corbyn emergence of talk about a ‘Canada it would nevertheless represent such Government. Or whether the elastic plus’ model is that Theresa May a restriction on our mutual market will, before too long, wear too thin pointed out the drawbacks to it in her access that it would benefit neither of meaning that she as Prime Minister key speech in Florence. our economies. and her Government simply can no In it she said that some people “Not only that, it would start from longer survive. I have held to the had “put forward a stark and the false premise that there is no former view but you do wonder. unimaginative choice between two pre-existing regulatory relationship But the other major question is models: either something based between us. And precedent suggests whether such a deal – much more on European Economic Area that it could take years to negotiate. than ‘Canada Plus’ is politically membership; or a traditional Free “We can do so much better than achievable. This then raises further Trade Agreement, such as that the this.” questions of a ‘no deal’ outcome with EU has recently negotiated with I have quoted the Prime Minister’s all the drawbacks that that poses for Canada. Florence speech comments at length business. “I don’t believe either of these because it is worth keeping at the Despite all this uncertainty options would be best for the UK or front of her mind that her vision business appears to be keeping on best for the European Union.” of the deal to emerge was not a keeping on with little signs of major 42 INSIDER December 2017 www.insider.co.uk REPORT: BREXIT UPDATE effects - until now. consumers globally.” EU agreement. Stuart MacLean, a partner of law The Scottish life sciences sector It goes on: “Companies want firm CMS, believes that his clients employs 37,000 people across around experts and life sciences managers are treating political uncertainties as 700 organisations. Companies in the from the EU and overseas to be able just another of the business risks they sector contribute more than £4.2bn to enter the UK at least as easily as face. turnover and about £2bn gross value at present; we would have concerns He believes there is no significant added to the Scottish economy, and over any restrictions on highly-skilled effect from Brexit on deal flow. He the sector is growing at around six talent entering Scotland.” says: “Domestically we are seeing per cent per annum. It also stresses the need to maintain active financial sponsors whether Life Science Scotland highlights research and development in the venture capital, private equity four main areas of concern: sector. It says: “The sector needs or family and personal offices regulation, trade and supply, access to continue to benefit from the continuing to find new opportunities to talent and maintaining research excellent R&D relationships and in a wide range of sectors.” and development. The letter follows collaborations. Securing science But what effect is it having on a six-month period of consultation funding levels is imperative.” Scotland’s exporting sectors and with companies across the sector in There are other sectors where the companies? Scotland. effects of Brexit, the organisational Chris Miller, co-founder of the On regulation it says: “The sector is surgery required in cutting the UK Craft Beer Clan of Scotland as the of the clear view that UK life sciences industry out of its EU host body is public-facing arm of JW Filshill regulation should not diverge from fiendishly complicated. International, Scotland’s premier EU regulation and should continue For example much of the exporter of craft beer and spirits, to see continued cooperation with regulation of air travel comes from was on a visit to China to judge the the European Medicines Agency. We the EU with areas such as ground country’s groundbreaking craft beer would strongly resist creating a new handling, slot allocation at congested awards in mid-November. and untried Scottish life sciences airports and air traffic management He says: “Brexit is a complex regulator when there is a long all are currently dealt with by the EU. issue which until negotiations established global regulatory system.” The EU also deals with such issues are complete, impact is currently The body argues that: “Ease of as air passenger rights and airport unknown to businesses both inside movement of our goods and supplies charges and the working hours of and outside the EU. We are working needs to continue tariff free and airport and airline staff are covered hard to ensure that we have a there needs to be minimal customs by the EU Working Time Directive. balanced diverse business that has procedures to allow quick and There are signs, however, that a circular process of not only goods efficient distribution of our products business is losing patience with the coming into the business from across the EU.” failure to deliver real progress in the international markets but goods It says that at a minimum there EU-UK negotiations. A 14-strong flowing out to international markets needs to be continual mutual delegation of business leaders told too. recognition for the testing and Theresa May and other ministers “This is an appropriate step to take releases of life sciences products that there had to be progress within a in light of the current uncertainty between the relevant UK and EU fortnight or there would be a collapse surrounding Brexit where there is regulatory bodies. in economic confidence in Britain. unlikely to be any clear winners on Companies, surveyed by the “We told them that they’ve lost either side of the negotiating table.” body, also stress the importance of a year because nothing happened. But there are warnings that the the US life sciences market and are Now you have two weeks in which prospect of Brexit is already having a supportive of a UK/US trade deal you have to be very clear,” said negative effect on some sectors with being initiated along with any UK/ Emma Marcegaglia, president of fears that it will get worse. In an open BusinessEurope, which organised letter Dave Tudor, industry chair of the 14-strong delegation. Life Science Scotland, the industry While the unanswered questions leadership group for life Sciences in are still piled high there are some Scotland, warns that “uncertainty answers. One is that parliament arising from the UK Government will have a vote on the final Brexit decision to leave the European Union deal after David Davis promised to is already having negative impacts introduce legislation that will allow on these life sciences companies in this to happen. Scotland, and the concern is that this The concession, which surprised is set to intensify”. some, was in line with signals sent Tudor who is vice president of out some two weeks before by primary supply chain at FTSE100 Downing Street. It was a reminder drug maker GlaxoSmithKline that answers do eventually emerge on writes in the letter that: “Our aim what Brexit will mean. ■ is to ensure that the Scottish life sciences sector continues to thrive The LSE research is from CentrePiece and grow and we believe there is Volume 22(3) Autumn 2017 significant benefit in continued close published by the Centre for Economic partnership and collaboration with Performance at London School of the EU for the benefit of patients and Economics and Political Science. www.insider.co.uk December 2017 INSIDER 43 Corporate, commercial, capable.

Deals in Summer/Autumn ‘17: • Advising Mr Billy Walker & consortium on the acquisition of the Glenallachie Distillery and brands from Pernod Ricard • Advising the all-female management team in the MBO of Executive Benefit Services • Advising the shareholders on the sale of Cobalt Water to Castle Water • Advising Atlas Blue on the acquisition of Prontoport, a provider of engineering support services to wind, wider energy & industrial markets • Advising the employee ownership trust on the buyout of Pierceton Engineering • Advising Old College Capital (Edinburgh University) on investments in Kajeka, Destina, Auris Tech and Particle Analytics

Team of the Year – Law Awards of Scotland 2016 Legal 500 Recommended Lawyer 2017 Legal 500 Leading Firm 2017

www.macdonaldhenderson.co.uk e: [email protected] t: 0141 248 4957 Q3 DEALS: ROUND-UP

TRANSACTIONS FALL BUT DEALS QUALITY STANDS OUT

By Perry Gourley based fashion group Quiz joining the Above: Entier CEO acquired by private equity group market. Peter Bruce (left) Bridgepoint in a £655m transaction arring a late surge of With housing group Springfield with BGF investor from funds managed by GSO Capital corporate deals in the final Properties also making its market Mike Sibson Partners. weeks of 2017, transaction debut in October, 2017 has already Despite the fall in reported deal Bnumbers for the year will cemented its position as the most numbers, advisors are generally register a sizeable fall over 2016’s tally. active year for Scottish Aim floats upbeat about the quality and quantity Although political uncertainty since 2012. of activity they are seeing. is undoubtedly acting as a drag on The quarter also saw a Scottish David Kirchin, partner and head of some sections of the deals market company list on the Nasdaq market. corporate for Addleshaw Goddard as Insider’s analysis of third quarter in Scotland, says the Scottish M&A activity underlines, there are also market is “holding its own in terms significant grounds for optimism IPO activity across the UK market of opportunity, investor interest from the quality of the transactions and price expectations” despite the seen in the third quarter of the year. in the third quarter experienced a perceived challenges and uncertainty Overall deal numbers involving created by political conditions. Scottish advisors fell sharply in the significant uptick. And we expect that “We’re seeing a healthy mixture third quarter to 151 compared to Q4 2017 will be the most active quarter of private equity and corporate the 262 seen in the same period last transactions, with capital available Mike Timmins, EY (below) year, taking the total for the first nine from both UK and international months of 2017 to 502, down from investors to support acquisition and 704 in 2016. Scottish deals so far this NuCana, an Edinburgh-based growth opportunities,” he says. year stand at 385, down from 543. clinical-stage biopharmaceutical According to Graham Cunning, However, the latest quarter company focused on improving head of corporate finance with included the completion of the treatment outcomes for cancer Campbell Dallas, the number of £11bn Standard Life/Aberdeen Asset patients, raised about $100m in the unsolicited approaches he is seeing Management merger – the biggest- move. being made directly by buyers to ever all Scottish corporate deal. One of the largest private equity business owners also indicates a After a long lean spell, the period deals seen in Scotland for several strong underlying market. also saw the first Scottish Aim years was also completed with “The buyers are both trade and flotation of the year with Glasgow- housebuilder Miller Homes being mid-market private equity houses, www.insider.co.uk December 2017 INSIDER 45 MBO/Is reconstructions

20 2017 10 2016 2017 2016 16 8

12 6

8 Number of Deals Number of Deals 4

4 2

0 Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total

startups specialist banking 250 12 2017 2017 2016 2016 200 9

150

6 100 Number of Deals Number of Deals Q3 DEALS: ROUND-UP 3 50

0 0 Sco Non Sco O/seas Total Sco Non Sco O/seas Total

acquisitions/sales and are not just based in the UK, but also in MBO/IsAcquisitions/Sales ppp 350 Europe and the US helped by the fall in the 2017 reconstructions 2016 50 value of sterling,” he says. 300 2017 20 2016 2017 10 “Buyers are doing their homework, will 250 2016 40 2017 2016 look to develop a relationship with the 16 200 8 business owners and are often willing to pay a 30 12150 6 premium for having exclusivity on the deal.” Number of Deals 20 Stuart MacLean, a partner of law firm 100 Number of Deals 8 CMS believes that clients are treating political Number of Deals Number of Deals 4 50 10 uncertainties as just another of the business Cello Signal acquired 4 0 Sco Non Sco O/seas Total 2 risks they face. 0 Tanami Media Sco Non Sco O/seas Total 0 “Domestically we are seeing active Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total financial sponsors whether venture capital, new issues/jvs private equity or family and personal offices 125startups specialist banking continuing to find new opportunities in a Start-ups2017 MBO/Is 2016 250 wide range of sectors. 12 2017 100 2017 reconstructions 2016 “This partly reflects the need to utilise 2016 20 200 funds raised, but ultimately is a sign that there 2017 10759 2016 2017 2016 are lots of ambitious businesses looking to 16 150 508 partner with equity backers to grow. It doesn’t Number of Deals 6 all deals 100

12 Number of Deals feel to me like we are in any sort of go-slow Number of Deals 256 120 period.” Balhousie Care Group’s CEO Steve 3 2017 Average: 55 Total: 502 8 50 Number of Deals White (left) and chairman Tony Banks Number of Deals 40 2016 Average: 74 Total: 704 The flotation of Glasgow-based ‘fast Sco Non Sco O/seas Total fashion’ chain Quiz Clothing on Aim was one 96 4 0 0 2 Sco Non Sco O/seas Total Sco Non Sco O/seas Total of the most keenly-watched transactions of 72 the quarter. 0 Sco Non Sco O/seas Total 0 flotationsSco Non Sco O/seas Total Ewan Grant, head of corporate finance in acquisitions/sales 48ppp Scotland for RSM which acted for the firm, 3505 20172017 24 startups specialist20162016 banking 50 says the flotation highlighted the progress the 300 Specialist banking 2017 4 2016 company has made in recent years. 250 12 2017 0 2017 250 40 J F M A M J J A S 2016 “Quiz has consistently demonstrated 2016 3 200200 resilience and energy in a fast moving and 9 30 highly competitive sector; and this has now 1502 Number of Deals

Number of Deals 150 been recognised by the investor community,” John Murphy, third from left, led a 20 100 Number of Deals 6 1 he believes. buyout of William Engineering 100 Number of Deals

Number of Deals 50 Mike Timmins, EY partner and IPO leader 10 3 00 50 ScoSco NonNon Sco Sco O/seasO/seas TotalTotal in Scotland, believes Quiz’s market debut has The deal confirmed months of speculation 0 signalled renewed confidence and could act as around a deal involving the firm which is one Sco Non Sco O/seas Total 0 0 Sco Non Sco O/seas Total a stimulus for other Scottish-headquartered Scoof the Nonlargest Sco housebuildersO/seas Total in the UK. new issues/jvs businesses to follow suit. Bridgepoint – which also owns sandwich 125 “IPO activity across the UK market in acquisitions/saleschain Pret A Manger –acquired the business 2017 the third quarter experienced a significant from GSO Capital Partners, which is part of ppp2016 350 100 2017 uptick. And we expect that Q4 2017 will be 2016private equity giant Blackstone. 50 300 2017 the most active quarter of the year with a The quarter saw a continuation of a 75 2016 number of Scottish companies also close to 250 long-running trend of overseas firms buying 40 50 announcing their intention to float,” adds 200 Scottish companies. Number of Deals 30 all deals Timmins, although he believes a full recovery Among deals in the technology sector, £23.27m 150 25 Number of Deals in the IPO market is dependent on the pound Edinburgh-based data analytics specialist 20The total disclosed value of 120 100 Number of Deals MBOs completed in Scotland 2017 Average: 55 Total: 502 stabilising and greater clarity around the UK’s Aquila Insight was acquired by US marketing 0 2016 Average: 74 Total: 704 Sco Non Sco O/seas Total withdrawal from the EU. 50 agency Merkle. The deal, for an undisclosed 10 so far in 2017 96 0 Although it came after the quarter end, Scosum, hasNon Sco seen O/seasAquila co-foundersTotal John 0 72 Moray-based Springfield Properties’ Aim Brodie and Warwick Beresford-Jones remain Sco Non Sco O/seas Total flotations listing will further boost confidence that the MBO/Isat the helm of a team of more than 60 48 new issues/jvs reconstructions long-running reduction in Scotland’s tally statisticians and data scientists, working with 5 Reconstructions2017 24 of stock market quoted companies will be 12520 clients including Royal Bank of Scotland, 2016 20172017 10 reversed. 20162016Sony Mobile and Tesco Bank. 4 2017 2016 0 10016 J F M A M J J A S Springfield raised £25m before costs The life sciences sector continues to see 8 through the placing of shares with the heightened levels of activity with deals 3 7512 proceeds earmarked to help progress the including Frankfurt Stock Exchange-listed 6 2 Number of Deals group’s five ‘village’ development sites near 50 Evotec AG making a €15m investment into

Number of Deals 8 Number of Deals Number of Deals 4 Edinburgh, Stirling, Dundee, Elgin and Perth. Dundee’s Exscientia in a deal advised on by 1 all deals 254 Although Edinburgh-based Miller Homes CMS. 1202 0 2017 Average: 55 Total: 502 had also once planned to list on the stock Among domestic deals during the quarter, Sco Non Sco O/seas Total 2016 Average: 74 Total: 704 00 ScoSco NonNon Sco Sco O/seasO/seas TotalTotal 096 market, the quarter saw it sold to private marketing and media group Cello Signal Sco Non Sco O/seas Total equity buyer Bridgepoint. - behind The Leith Agency, Signal and 72 46 INSIDER December 2017 startups specialist bankingwww.insider.co.uk flotations 25048 12 2017 2017 2016 5 2016 2017 24 2016 200 9 4 0 150 J F M A M J J A S 63 100 Number of Deals Number of Deals 2 Number of Deals 3 50

1

0 0 Sco Non Sco O/seas Total Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total

acquisitions/sales ppp 350 2017 2016 50 300 2017 2016 250 40

200 30 150 Number of Deals 20

100 Number of Deals

50 10

0 Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total

new issues/jvs

125 2017 2016 100

75

50 Number of Deals all deals 25 120 2017 Average: 55 Total: 502 0 2016 Average: 74 Total: 704 Sco Non Sco O/seas Total 96

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5 2017 24 2016 4 0 J F M A M J J A S 3

2 Number of Deals

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0 Sco Non Sco O/seas Total Q3 DEALS: ROUND-UP

Stripe Communications - acquired buy-ins have more than doubled to Edinburgh-based film production 13. experts Tanami Media. Graham Cunning at Campbell Under the undisclosed terms of Dallas believes more buyouts are in the deal Tanami will remain a self- the pipeline as private equity houses contained business unit reporting hunt deals. directly to Cello Signal’s Scotland “Looking ahead for the next few managing partner Richard Marsham. months into early 2018 we are likely Although the whisky sector has to see more MBO activity. This is seen a string of deals involving going to be driven by PE houses like foreign buyers in recent years, Maven, NVM, YFM and Mobeus, the quarter saw the return of the who have all recently raised buyout Glenallachie Distillery to Scottish funds as a result of recent rule ownership. changes, which meant venture capital MBO/Is Industry veteran Billy Walker led trust funds could no longer be used the deal to acquire the distillery and reconstructions to invest in MBOs,” he explains. 20 various whisky brands from Pernod “The buyout funds are now in 2017 10 2016 2017 Ricard. 2016 place and these PE houses are out 16 Above: Keith The new owners, who were advised sister8 company Brightwaste with looking for new opportunities, by Macdonald Henderson, plan to each company continuing to trade Skeoch and actively marketing themselves, 12 Martin Gilbert, rejuvenate the brands and target using6 their respective names for the meeting companies and seeking to chief executives 8 export markets including France, foreseeable future. back entrepreneurial management Number of Deals Number of Deals 4 of Standard Life Germany and the US. While overall transaction numbers Aberdeen plc teams with their funds and expertise.” 4 Elsewhere in the drinks sector, are2 down so far this year, buyouts Buyout deals completed in the craft brewer Innis & Gunn accepted are continuing to enjoy a revival. third quarter included one involving 0 Sco Non Sco O/seas Total 0 a £15m investment offer from US In the firstSco nineNon ScomonthsO/seas of theTotal year all-female financial services firm private equity firm L Catterton in management buyouts (MBOs) and Executive Benefit Services. startups exchange for a 27.9 per cent stake in specialist banking Managing director Val Barr led the business. The transaction values the acquisition of the Lanark-based 250 12 Domestically2017 we are seeing active 2017 the business at around £50m. firm after securing £1m in financial 2016 2016 Bellfield Brewery, the UK’s first 200 backing from Allied Irish Bank. 9 dedicated gluten-free microbrewery, financial sponsors whether venture One of Glasgow’s most established also raised £430,000 in an equity capital,150 private equity or family and family-run timber and builders’ 6 funding round led by Scottish angel merchants, Kelvin Timber, also 100 Number of Deals Number of Deals investment syndicate, Equity Gap. personal offices continuing to find new completed a buyout in a deal advised 3 The round, advised on by 50 on by French Duncan. Henderson Loggie and Harper opportunities in a range of sectors The transaction saw the business, 0 Macleod, was supported by the 0 which was set up by brothers Frank Sco Non Sco O/seas Total Sco Non Sco O/seas Total Stuart MacLean, CMS (below) Scottish Investment Bank and and Vincent McHugh, acquired Bellfield’s existing shareholders. by Frank’s son, Richard and the acquisitions/salesAll-Scottish deals signed during ppp company’s existing managing 350 PPPs 2017 the quarter included fuel distribution director Mark Maginnis. 2016 50 300 firm James D Bilsland, which has 2017 Shawbrook Bank provided 2016 250 its headquarters in Drymen, near 40 funding to the team and Macdonald Stirling, taking over Kilmarnock- Henderson acted as legal adviser. 200 based Andrew Gray & Co Fuels for 30 Kilwinning-based engineering 150

Number of Deals £2.8m. The purchase was supported firm William Engineering was the 20 100 by a £1.6m loan facility from the Number of Deals subject of a buyout by its former Bank of Scotland. general manager John Murphy in 50 10 Aberdeen recruitment firm 0 a deal backed by Business Loan Sco Non Sco O/seas Total Cammach Recruitment, which 0 Scotland and Team North Ayrshire. Sco Non Sco O/seas Total specialises in oil and gas, also paid The business is now known as new issues/jvsan undisclosed sum to take control Murphy Engineering (Scotland). of local peer Bryant Group, which MBO/Is IT security and back-up specialist 125 reconstructions 2017 continues to trade under its own MBO/MBI VectorCloud was also bought by 2016 20 100 name. 2017 10three senior employees, Kevin 2016 2017 Scottish cleaning entrepreneur Mitchell,2016 Ewan McKay and Scott 16 75 Roger Green purchased the 8Cassidy. The deal has seen the firm

commercial and industrial division 12 move to new offices at Eurocentral in 50 6 Number of Deals of Alloa-based ACE Recycling Group all deals Lanarkshire. 8 25 CIC in a deal that has secured the Number of Deals Number of Deals 4 Banking and investment deals future of the company after it fell 120 during the quarter included a 4 2017 Average: 55 Total: 502 0 into administration. ACE Recycling 2016 Average: 74 Total: 704 2£6.5m investment by BGF (Business Sco Non Sco O/seas Total 96 will merge with his commercial 0 Growth Fund) into Entier, Scotland’s Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total cleaning company Spotless and its 72 largest independent privately-owned www.insider.co.uk 47 flotations December 2017 INSIDER 48startups specialist banking 5 250 2017 12 2017 24 2017 2016 2016 2016 4 200 0 9 J F M A M J J A S 3 150

6 2

Number of Deals 100 Number of Deals Number of Deals

1 3 50

0 0 Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total Sco Non Sco O/seas Total

acquisitions/sales ppp 350 2017 2016 50 300 2017 2016 250 40

200 30 150 Number of Deals 20

100 Number of Deals

50 10

0 Sco Non Sco O/seas Total 0 Sco Non Sco O/seas Total

new issues/jvs

125 2017 2016 100

75

50 Number of Deals all deals 25 120 2017 Average: 55 Total: 502 0 2016 Average: 74 Total: 704 Sco Non Sco O/seas Total 96

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0 Sco Non Sco O/seas Total Q3 DEALS: ROUND-UP catering company. The Westhill-based company plans to Top Performers expand its overseas operations, building on its ...among Scotland’s Investors/Advisors January 2017 to September 2017 existing work at 38 locations in 23 countries. The company also recently acquired Wilde Investors No. of deals Value Sector Breakdown No. of deals Thyme, the Perthshire-based catering firm, Scottish Enterprise* 40 >£32.83m Banking & Finance 44 Royal Bank of Scotland 6 >£110.68m which runs the restaurants at Glamis Castle Construction 8 Par Equity 6 >£5.55m in Angus and the Glenturret Distillery in Distribution & Wholesale 5 Perthshire, home to the Famous Grouse Old College Capital 6 >£1.84m MBO/Is Drinks (+soft) 11 whisky brand. Business Growth Fund 5 >£26.3m reconstructions A refinancing deal worth £49m was also Barwell Plc 5 >£1.38m Electronics 34 20 2017 Archangel Informal Investments 4 >£3.26m Engineering10 14 struck by the Balhousie Care Group with 2016 2017 Kelvin Capital 4 >£2.12m 2016 Coutts and Triodos. 16 Food & Farming 22 Scottish Futures Trust Investments 3 >£47.20m 8 The refinance was advised on by Hotels & Leisure 65 HCF Investments Limited 3 >£47.20m 12 Hampshire-based Premier Commercial Archangel Investors Ltd 3 >£5.22m Industrial6 & Manufacturing 58 Finance, which specialises in the corporate 8 Shawbrook Bank Plc 3 >£2.8m Marketing & Media 18 Number of Deals Number of Deals 4 healthcare sector. Equity Gap 3 >£0.9m Motor 2 The founder of the New Look fashion 4chain, Clydesdale Bank 3 N/D Offshore2 33 Tom Singh, was among the backers of a £1m HSBC (Scotland) 2 >£190m 0 Paper & Packaging 3 funding round secured by Scottish education Sco Non ScoWellspringO/seas PartnershipTotal Limited 2 >£43.78m 0 Sco Non Sco O/seas Total software firm Gecko Labs. The deal is aimed at Greater Glasgow Health Board 2 >£43.78m Property Dev & Investment 32 accelerating the Edinburgh-based company’s West Coast Capital 2 >£5.2m Retail 8 global push as it launches a new live chat startups EOS Syndicate Management Ltd 2 >£0.71m Services*specialist banking 165 GU Holdings 2 N/D 250 system connecting universities and potential12 2017 2017 Textiles 2 Panoramic Growth Equity 2 N/D 2016 students. The firm is also expanding into the 2016 Transport 9 Lonsdale Capital Partners 2 N/D 200 North American market, opening a London9 *Note: Services includes - Utilities 32, Healthcare 18. Some deals fall into more Lloyds Banking Group 2 N/D office and plans to increase staff numbers than150 one sector *incl Scottish Investment Bank 5 @>4.93m **incl Bank of Scotland 1 @N/D. by 50 per cent following the support from6 All other investors were non-Scottish or participated in one deal ACCO100 UNTANTs No. of deals Value Number of Deals

investors. Number of Deals Anderson Anderson & Brown 24 >£46m Transactions in the oil and gas sector during3 Lawyers No. of deals Value Johnston50 Carmichael 15 >£80.87m the quarter included a complex restructuring Brodies 85 >£1.32bn of around $3.3bn of debt facilities for listed Burness Paull 74 >£3.89bn PwC0 12 >£1.04bn 0 Sco Non Sco O/seas Total firm Premier Oil. Sco Non ScoPinsentO/seas MasonsTotal 59 >£3.63bn Consilium 11 >£7.25m Gillespie Macandrew’s corporate and CMS Cameron McKenna 57 >£1.31bn DC Consulting 10 >£7.85m dispute resolution team analysed and reportedacquisitions/sales Harper Macleod 46 >£256.37m BDO ppp 9 >£47.7m on the statutory compliance of the proposed350 Shepherd & Wedderburn 45 >£2.65bn 2017 Campbell Dallas 9 >£6.92m 50 schemes for the Scottish courts. 2016 Dentons/Maclay Murray & Spens 25 >£6.84bn 300 Henderson2017 Loggie 6 >£1.12m Stirling-based WaveLIFT secured funding Macdonald Henderson 24 >£15.03m 2016 of more than £1m to further develop its 250 Addleshaw Goddard 22 >£145.59m Simmons40 & Co International 6 N/D innovative pump technology for the oil 200 MacRoberts 21 >£117.6m Grant Thornton 5 >£78.35m MBM Commercial 19 >£10.56m 30 and gas sector. The funding was led by 150 RSM 5 >£35.13m

Number of Deals DLA Piper (Scotland) 15 >£646.37m Scottish business angel investment syndicate, Mazars20 4 >£45.9m 100 Morton Fraser 13 >£3.33m Number of Deals Archangels, with co-investment from Scottish French Duncan 3 >£5.4m 50 Blackadders 12 >£1.42m 10 Enterprise and a private investor. EY 2 >£136m 0 Lindsays 11 >£1.31m Skin care technology firm Cutitronics, Sco Non Sco O/seas Total Blackwood Partners 10 >£7m Caledonian0 Economics 2 >£96.6m established in 2014 as a spin-out company Sco Non Sco O/seas Total Thorntons 10 >£6.83m Deloitte 2 >£37.5m from the University of Strathclyde, also Morisons 8 >£24.51m new issues/jvs FRP Advisory 2 >£18.5m announced a significant investment from Bellwether Green 7 >£0.12m 125 Robertson Smith & Co 2 >£2.5m FTSE 100 firm Croda. 2017 Vialex 7 N/D Although the recent interest rate rise could 2016 Stronachs 7 N/D Morris & Young 2 >£2.5m 100 impact on business confidence which in Wright Johnston Mackenzie 6 >£0.9m Stewart and Stewart 2 N/D Kergan Stewart 5 >£7.12m turn may dampen some areas of the deals75 Blair & Bryden 2 N/D market in the months ahead, Donald Munro, Ledingham Chalmers 5 N/D All others were non-Scottish or participated in one deal only. 50 Frazer Coogans 3 >£3.09m head of corporate at Harper Macleod, saysNumber of Deals all deals consolidators in a number of sectors have “got Grant Smith Law Practice 3 >£2.8m 25 BTO 3 N/D All deals the money lined up and they’re going to spend 120 DWF 3 N/D 2017 Average: 55 Total: 502 i t ”. 2016 Average: 74 Total: 704 0 Holmes McKillop 3 N/D He also believes the merger moves seen in Sco Non Sco O/seas Total 96 Brunton Miller 2 >£3.2m the legal sector north of the border of late are a ISW Legal 2 >£0.43m 72 positive for the remaining Scottish advisers. flotations Davidson Chalmers 2 N/D “There are many fantastic clients in Clark Boyle Solicitors 2 N/D 48 Scotland who it appears the ‘global’ players5 McKinstry & Co Solicitors 2 N/D 2017 24 aren’t really interested in and therefore can’t 2016 James Thomson & Son 2 N/D service effectively, which creates increased4 Condies 2 N/D 0 J F M A M J J A S opportunity even if overall activity shows a All others were non-Scottish or participated in one deal only. downward trend,” he argues. ■ 3 48 INSIDER December 2017 www.insider.co.uk 2 Number of Deals

1

0 Sco Non Sco O/seas Total Q3 DEALS: TABLES

Note: The advisors column should be read as being the parties to the deal (abbreviated) followed by the advisor who acted for that party. Common abbreviations used are as follows: DI = Deal Initiator; V = Vendor; P = Purchaser; I = Investor; Co = Company. Initials or shortened names are used to define other parties to the deal, the full name being in the column detailing the deal. Please note, transactions previously had to be valued at £0.5m or more to be included in the tables. We no longer have this criteria; deals with an undisclosed value are now shown as N/D and advisors involved in these deals have a zero value attributed in our analysis.

Principal & Location Details of Deals Deal Value Deal initiators and advisors involved Date

Selected Scottish deals 3fBIO Limited Investment in this sustainable food and fuel company £460k Co: Morisons 7.17 Glasgow by Scottish Enterprise and EOS Technology Investment Issue Of New Shares EOS: Thorntons Syndicate. SE: Shepherd & Wedderburn Administrate Limited Investment in this business management software c£1m Equity Co: Howes Percival 7.17 Edinburgh developer by Archangel, Tri Capital, Scottish Enterprise I: MBM Commercial and others. SE: Burness Paull Apache North Sea Ltd Transfer of the undivided legal interest in petroleum N/D V: CMS Cameron McKenna Nabarro Olswang 7.17 Aberdeen production licence P.1998, together with a 22.5% P: Pinsent Masons interest under the corresponding JOA, by this oil and gas exploration company to Origo Exploration UK Limited. Apple Oils Limited Investment secured by this fuel supplier through £100k Grant DI: Apple Oils Limited 7.17 Glasgow an RSA grant from Scottish Enterprise to support the Co: Consilium growth of the business. Argyll & Bute Council NPD project with Hub North Scotland Limited and c£8m Cash HNS: Harper Macleod 7.17 Lochgilphead Galliford Try Building Limited (trading as Morrison Co: CMS Cameron McKenna Nabarro Olswang Construction) for the design, build and refurbishment of a new primary school at Dunoon. Avant Homes Facility secured by this home construction company to £200m 8.17 Stirling fast-track its expansion plans. Avondale Holdings Sale by this waste management and recycling company £25m DI: Avondale Holdings Limited 9.17 Limited of the business and assets of its Central Scotland landfill V: Addleshaw Goddard/PwC Falkirk site, power generation and large scale material recycling P: Maclay Murray & Spens facility to NPL Estates. I: Eversheds Balhousie Care Group Refinancingprovided to this care home provider by £49m Cash DI: Balhousie Care Group/Premium Commercial 8.17 Perth Coutts & Company and Triodos Bank NV to allow for Finance Ltd Balhousie to carry out expansion plans and improve the Co: Brodies qaulity of their existing care homes. L: Addleshaw Goddard Bellfield Brewery Ltd Investment in this gluten free brewery by Equity Gap >£400k Equity Co: Harper Macleod/Henderson Loggie 7.17 Edinburgh Limited and Scottish Investment Bank. I: Wright Johnston Mackenzie

Campbell Dallas Sale of the business and assets of this leading Scottish N/D V: Harper Macleod/Campbell Dallas 9.17 Glasgow accountancy firm to Baldwins (Acquisition4) Limited, P: Wilkes Partnership guaranteed by Cogital Topco Limited. CT: Skadden, Arps, Slate, Meagher & Flom Carraig Gheal Wind Refinancingprovided to this wind farm developer by c£75m Debt Co: Pinsent Masons 9.17 Farm Ltd Banco de Sabadell, S.A., London Branch, ING Bank, a L: Burness Paull/Norton Rose Fulbright Argyll branch of ING-DIBA AG, and Santander UK Plc. Castle Leisure Group Refinancingundertaken by this licensed leisure £3.2m Debt Funding DI: Castle Leisure Group/DC Consulting 8.17 Stirling operator to secure the exit of venture capitalist, P: Brunton Miller/DC Consulting Downing LLP from the current structure, enabling the management team to drive value in the business over the medium-term. Chivas Brothers Ltd Sale by this drinks distiller of the Glenallachie Distillery N/D DI: Chivas Brothers/Exchangelaw (703) Limited 10.17 Paisley in Speyside, and the White Heather and McNair whisky V: Shepherd & Wedderburn brands, to a consortium led by former Benriach MD Billy P: Macdonald Henderson/Grant Thornton Walker. Connelly Security Share buy-back by this security systems company of its £435k Cash P: Harper Macleod/Johnston Carmichael 7.17 Systems Ltd own shares from Patrick Connelly. Glasgow Cutitronics Ltd Investment in this cosmetics technology business by N/D Cash DI:Cutitronics 7.17 Glasgow Croda Europe Limited. Co: Harper Macleod East Lothian Council NPD project with hub South East Scotland Limited for £18.54m Cash DI: East Lothian Council 8.17 Haddington the design, build and construction of a primary school in HSE: Pinsent Masons Wallyford, East Lothian. Ecocleen MBO of the Scottish arm of this commercial cleaning N/D 7.17 Dundee specialist. FarrPoint Limited Creation by this IT and telecoms consulting firm of a N/D DI: FarrPoint Limited 8.17 Edinburgh new class of shares in the company, and the subsequent Co: Harper Macleod/Stewart and Stewart introduction of three new shareholders in the company by way of allotment. Fire Protection Group Sale of the entire issued share capital of this fire N/D Cash V: Burness Paull/RSM/Davidson Chalmers 8.17 East Kilbride protection and security group to Scutum International P: Penningtons/Frenger International Limited S.A.

www.insider.co.uk December 2017 INSIDER 49 Q3 DEALS: TABLES

Principal & Location Details of Deals Deal Value Deal initiators and advisors involved Date

Gallone & Son Limited Sale of the entire issued share capital in this £310k Cash V: Lindsays 9.17 Glasgow accountancy firm by Stuart Gallone & Son to P: Cloch Solicitors Ashcombe Hensley Limited. Housing Growth Joint venture between this housing development N/D HGP: Burness Paull 7.17 Partnership investor and Caedmon Homes Holdings Limited CH: Square One Law Edinburgh by which investment was made to facilitate the development of housing in Whitby. Innis and Gunn Acquisition of a minority stake in this craft brewer N/D Cash DI: Innis and Gunn Holdings Limited 9.17 Holdings Limited by funds managed by L Catterton by way of (i) the Co: Vialex/Noble & Co Edinburgh acquisition of certain shares from the company's P: Mayer Brown International shareholders, and (ii) subscription for new shares in the capital of the company. Insights Learning & Buyout by this people development solutions N/D DI: Insights Learning & Development 9.17 Development Ltd company of its Danish and Swedish joint venture Co: Blackadders Dundee partner as part of its Global Alignment Project. V: Marselis Law J.D. Neuhaus Limited Disposal of the equipment rental division of this hoist N/D Cash V: Anderson Anderson & Brown 9.17 Aberdeen and crane systems manufacturer to Lifting Gear Hire Limited. James D Bilsland Purchase by this oil and gas distributor of the entire c£2.6m Cash DI: James D Bilsland Limited/Graham Macloed, 8.17 Limited issued share capital of Andrew Gray & Co (Fuels) Tilney Glasgow Limited, funded by Bank of Scotland. P: MacRoberts/Johnston Carmichael V: Brodies BoS: Harper Macleod V: Henry Brown & Co John Ros Jr (Aberdeen) Acquisition of 85% stake in this fish processing £13.2m Cash P: Eversheds/BDO 7.17 Limited company and Coln Valley Smokery Limited by Estonian V: Squire Patton Boggs/Cavendish Corporate Aberdeen listed acquirer AS PRFoods. Finance JR Dalziel (Holdings) Ltd Acquisition by this meat processing company of £3m P: Shepherd & Wedderburn 9.17 Bellshill Macspice Limited and McAusland Crawford Ltd. Kelvin Timber MBO of Kelvin Timber (West) Limited and Kelvin N/D Cash V: Harper Macleod 7.17 (Holdings) Ltd Timber (East) Limited. V/P: French Duncan Glasgow P: Macdonald Henderson I: Addleshaw Goddard Laing the Jeweller Ltd Re-merger of this family jewellery business, alongside N/D Debt V: Addleshaw Goddard/Mazars 9.17 Edinburgh Parkhouse The Jeweller, with Laings Glasgow Holdings P: Maclay Murray & Spens/BDO/Grant Thornton Limited after a 12-year split following the retirement of Michael Laing. Merchant City Global Sale of 50% of the issue share capital in this leading N/D Cash DI: Merchant City Global Holdings/Gillman 7.17 Holdings Ltd white goods distributor by Gillman Electrical Group Electrical Group Limited East Kilbride Limited. V: Macdonald Henderson P: BPE Solicitors Merlin ERD Limited Establishment of The Merlin ERD Employee N/D Cash DI: Merlin ERD Limited 8.17 Perth Ownership Trust, for the benefit of the employees Co: Burness Paull of this oil and gas drilling engineer, and the sale of controlling interest of the issued share capital of the company to the Trust. MGB Biopharma Ltd Investment in this antibacterial drug developer by c£455k Equity I: MBM Commercial 7.17 Glasgow Archangel, Tri Capital, Scottish Enterprise, Barwell and Co: Morton Fraser other investors. SE: Shepherd & Wedderburn Nanclach Limited Financing provided to this wind farm developer by £77m Debt Co: Pinsent Masons 8.17 Nairnshire Bank of Tokyo - Mitsubishi UFJ, LTD. L: DLA Piper Omega Diagnostics Placing, subscription and open offer of new shares £3.3m Cash Co: Brodies 7.17 Group Plc on the AIM by this medical diagnostics manufacturer, Alva broked by finnCap Limited. Perth & Kinross Council NPD project with Hub East Central (Bertha Park) £31.6m Debt And DI: Perth & Kinross Council 9.17 Perth Limited, Robertson Construction Group Limited and Equity PKC: MacRoberts/Caledonian Economics Aviva Investors Multi-Asset Alternative Income S.A. for HEC: CMS Cameron McKenna Nabarro Olswang/ the design, build, finance and maintainance of a new QMPF secondary school to accommodate 1,100 pupils and I: Maclay Murray & Spens 35 ASN pupils. RCG: Harper Macleod Portland Hotels Ltd Sale of the Portland Hotels group, owners and N/D Cash V: Brodies 8.17 Edinburgh operators of five hotels in Scotland, to Leonardo P: DLA Piper/French Duncan Portland Holdings Limited. Premier Oil Plc Restructuring of this company's corporate debt £3.3bn Debt, Loan Co: Slaughter & May 7.17 Aberdeen with GLAS Trust Corporation Limited, Barclays Plc, And Equity GLAS/Barclays: Allen & Overy HSBC Bank Plc and Mizuho Bank Ltd, including a Barclays: Burness Paull court sanctioned scheme of arrangement, corporate HSBC: Linklaters restructuring and equity warrants. Mizuho: Clifford Chance

50 INSIDER December 2017 www.insider.co.uk Q3 DEALS: TABLES

Principal & Location Details of Deals Deal Value Deal initiators and advisors involved Date

Raith Rovers Football Acquisition of the controlling interest in this football N/D Debt P: Lindsays 8.17 Club Ltd club through the purchase of shares in Raith Rovers Kirkcaldy Football Club Limited and Raith Rovers FC Holdings Limited by Stark's Park Properties Limited. Red Rooster Lifting Acquisition by this lifting and hoist service provider of N/D Cash Co: Addleshaw Goddard/Anderson 8.17 Limited its own shares to facilitate shareholder restructuring. Anderson & Brown Aberdeen Scottish Bioenergy Investment in this biotech company by Kelvin Capital £500k Equity I: Kergan Stewart/MBM Commercial 8.17 Newhouse and Investing Women. Scottish Building Sponsorship deal agreed between this building N/D Cash Co: Lindsays 8.17 Society society and Scottish Women's Football for three years. Edinburgh ScottishPower Sale of Scottish Power's 50% shareholding held in N/D DI: Tarmac 7.17 Generation Limited ScottishAsh Limited to Tarmac Cement and Lime P: CMS Cameron McKenna Glasgow Limited, following a joint venture between Tarmac and Nabarro Olswang ScottishPower. V: Shepherd & Wedderburn Smarter Grid Solutions Investment in this energy technology company by N/D SEP/I: Brodies 8.17 Ltd Scottish Equity Partners, through its Environmental I: Burness Paull Glasgow Energies Fund, together with other co-investors. Co: MacRoberts Springfords LLP Purchase of the business and assets of this N/D Cash DI: Baldwins Accountants 9.17 Edinburgh accountancy firm by Baldwins (Acquisition 4) Limited, V: Vialex a wholly-owned subsidiary of Baldwins Holdings P: Wilkes Partnership Limited. Standard Life Merger with Aberdeen Asset Management, creating £11bn 8.17 Edinburgh Standard Life Aberdeen Plc, an investment group with £670bn of assets under administration. STAR-Dundee Limited Move to majority employee ownership of this N/D DI: STAR-Dundee Limited 7.17 Dundee SpaceWire and SpaceFibre technology company P: Blackadders spun out from University of Dundee, via acquisition V: MacRoberts of 55% of the entire issue share capital by a UoD: Henderson Loggie newly-established employee ownership trust. SumDog Limited Investment in this educational technology company £1.4m Cash SE: Burness Paull 7.17 Edinburgh by Scottish Enterprise and Nesta Investments 1 LP to Co: MacRoberts allow the company to expand its services across the I: Michelmores UK and US. Tulloch Group Ltd Facility provided to this housebuilding company by £23m Cash DI: Tulloch Group 8.17 Inverness Bank of Scotland. Co: Brodies UniKlasers Ltd Investment into this unique laser producer from N/D Equity DI: Par Equity 8.17 Edinburgh Scottish Enterprise, Par Equity and others in exchange Co: MBM Commercial for equity. SE: CMS Cameron McKenna Nabarro Olswang PAR: Burness Paull VectorCloud MBO of this IT security and backup specialist. N/D 8.17 Glasgow Weee Scotland Ltd Investment secured by this electronic product recycler £100k Grant DI: Weee Scotland 8.17 Glasgow through an RSA grant from Scottish Enterprise to Co: Consilium support business growth. Weir Group Plc Acquisition of leading oil and gas technology provider $114m Cash DI: Weir Group 9.17 Glasgow KOP Surface Products. P: Burness Paull V: KPMG Well-Safe Solutions Asset acquisition agreement pursuant entered N/D P: Stronachs 8.17 Limited between this well abandonment specialist and V: Thorntons Aberdeen Intervention Project Management (IPM) Limited, to which IPM agreed to sell and Well-Safe agreed to buy the business of providing engineering consultancy services carried on by IPM, as a going concern. Whitespace (Scotland) Share buy-back by this marketing agency from Emma £500k P: Harper Macleod 9.17 Limited Jardine, who left the agency to go back to university. V: Morton Fraser Edinburgh

YouTrain Limited Sale of 100% of the shares in this leading IT and digital N/D Cash DI: BDO 8.17 Stirling training business to GP Strategies Training Limited. Consideration V: Harper Macleod/BDO P: Hill Dickenson

www.insider.co.uk December 2017 INSIDER 51 A law firm as

individual as you. “ If I need something done, MacRoberts “ will move heaven and earth to do it. Chambers UK Guide to the Legal Profession

www.macroberts.com Glasgow | Edinburgh | Dundee IN MY VIEW: RICHARD MACKIE

DON’T BECOME A RYANAIR: A PROACTIVE APPROACH TO MANAGING BUSINESS RISK

very year we are shocked by corporate this could happen, such as ineffective monitoring bankruptcy, famous brands being criticised of leave, recruitment issues, pandemic illness, on social media, cyber attacks, IT shutdowns ineffective HR systems or industrial action. Each Eand CEOs being caught up in scandal. Shock of these causes should have had controls in place aside, can these events ultimately be traced back to a challenging the likelihood so that this risk has a failure to manage risk effectively? low likelihood of occurring. However, if a business I would argue there is no such thing as being considers ‘reputational damage’ to be the risk then it blindsided in organisations; more than likely will soon find itself in a similar situation to Ryanair. there was compliancy, incompetence and a Reputational damage was never the risk, that was the lack of communication within the business. All outcome of not ensuring the airline had appropriate organisations possess the ability to be proactive and safe staffing levels. when it comes to risk management. However, many Translate this thinking to social media. It’s wrong are unprepared due to a failure to understand risk to think the risk is that the brand is criticised or management and manage the ‘right’ risks effectively. damaged by a particular event; in the same way, it is wrong to think the risk is the event. The real risk is actually the inability to respond appropriately Reputational damage was never the risk, that and effectively to social media activity and the subsequent impact is the brand damage. The was the outcome of not ensuring the airline likelihood of the organisation not responding can vary depending on what that ‘event’ is and the had appropriate and safe staffing levels impact magnitude can also vary depending on what the event is. It could be a bad TripAdvisor review, a As the outside professional looking in, it’s easy YouTube video, a disgruntled customer on Twitter to identify how and why things went wrong; was or a combination of them all. This is why effective this unforeseen; a breakdown in communication; a risk scoring can make the difference between an failure to upgrade IT systems; or generally a failure informed or ill-informed executive. of the business to keep on top of things? No, it was Look at your organisation and identify why a ultimately a failure of an organisation to be proactive risk may occur, no matter how unlikely you think when it came to risk. it might be, then try and provide the Board with a However, a business can become more proactive level of assurance that these risks will and can be by taking a step back from the risk register to managed effectively. The reactive organisation is the consider whether it contains impacts and issues not one that is blindsided first by the cause and then by risks? From experience, it’s likely to be a combination the outcomes of whatever the risk was; it will now of both. Remember an impact is an outcome and an fire fight its way through, sometimes successfully but issue is not a risk because it already exists, there’s no other times unsuccessfully. likelihood involved. Risk identification in a business Ultimately, by having effective risk management, environment is not about identifying the outcome, being able to provide assurance and thus being able it’s about identifying the risk. Ultimately, what is it to respond to a situation has additional benefits. that the organisation could fail to do that could lead Not only will the business manage any immediate to an outcome? reputational, operational or financial issues, but it Take Ryanair as an example, executive level could also turn a negative problem into a good news operational risk should have been identified as story about resilience and recovery. ■ ‘failure to ensure appropriate and safe staffing Richard Mackie is an associate director at RSM. levels’. A comprehensive risk assessment should have identified all the possible reasons as to why www.insider.co.uk December 2017 INSIDER 53 BUSINESS PROFILE

BULLET EXPRESS EXPANSION OFFERS COMPLETE DISTRIBUTION AND STORAGE SOLUTION BULLET express are this year over 27 years in we had the contacts and skills to make a success of the transport industry. Starting as a courier the project. company with one van and a monthly Clearly we have also realised that we get huge government grant of £22.00 per week. revenue benefits also from this through labour and We now have over 100 pieces of kit and a distribution which is now coming from all angles turnover of over £14m, and own our own 5 acre of the business. We completed that purchase in distribution site at Bothwell. Two years ago we April 2016 started getting asked frequently for storage Currently we are in the process of completing and started bringing goods into our Bothwell our BRC and Bond accreditation to allow us to distribution warehouse , however we quickly expand on the client base we have at present and realised it was not a clean atmosphere and decided achieve our goal of over 20,000 pallets by Christmas to outsource the storage to better clean conditions 2017. We have attracted two major clients to the as we were also getting the transport This we site in McFarlane packaging and Powerhouse managed to do with one of our local clients which fitness who have both signed up for 10 and 4 years . was a win win for all. Our new international freight forwarding Once we reached 1000 pallets we decided it simply bolted on their WMS which allows us to department are now also enjoying the storage was time to get serious about warehousing and export stock direct to the distribution system with options and de stuffing facilities for their clients therefore started the purchase of our former full customer vision . adding further to the revenue opportunities of the premises in east Kilbride which had a capacity of We send weekly reports to our customer of company. over 3000 pallets. This site has 14 dock levellers all stock in and out as well as cost , all goods are At present with the building we have over which we found superb for loading and scanned in and out as out entire site is WIFI linked. 15,000 pallets and have recently built a lorry park unloading and also introduced us the revenue Due to legal issues with the seller we could not and outside storage facility for over 5000 pallets. benefits of de-stuffing. complete the purchase in east Kilbride , however As part of this expansion we have also taken To run the business we moved our special in the meantime we maxed out the warehouse on 6 staff from the company that left the building services department and brought in a manager so decided to back out the deal and look for a and taken on two young apprentices who will go and apprentice to run the storage operation . larger unit. I used the looking time to meet with through a full 6 months apprenticeships through Donald Gillies our warehouse manager has over fellow transport suppliers and customers to gain GTG training UK. 12 year great experience as driver and manager better knowledge of where we need to get to for As a company we can now offer the full logistics trainer for Sainsburys in Glasgow. He was clearly a compliance and success, that led us to the UKWA package to our clients of shipping worldwide , man for the future development of the business. and we completed our ISO 2015 UK domestic distribution, storage and pick pack My son Scott has come in as his apprentice and This brought us by chance to a warehouse which fulfilments. recently won the UKWA young employee of the was double the price but 7 times the capacity at In just over 18 months we have went from year. Our sameday and overnight business use 21,000 pallets, whilst it was a huge risk due to the £100,000 turnover in storage to hopefully over Stirling solutions software , therefore we have costs we decided at board level it was worth it as £1m. a superb achievement for the Bullet team.

Contact us: Head Office: Bullet House, 5 Ashley Drive, Bothwell, G71 8BS. Tel: 01698 811777 www.bulletexpress.co.uk REGIONAL REVIEW: LANARKSHIRE

MB AEROSPACE DEAL SYMBOLISES LANARKSHIRE’S BOLD AMBITIONS

By Ken Symon Corporation, the US aircraft engine Above: more than 500 new homes, a park manufacturer, a contract potentially MB Aerospace and a primary school, went out to t was a deal that links worth up to $1bn. chief executive consultation last month (November). Motherwell with Taiwan. The progress that MB Aerospace Craig Gallagher Nick Davies, director of MB Aerospace agreed to buy has made since Gallagher led Ravenscraig Ltd – a joint venture of IAsian Compressor Technology the management buyout from Scottish Enterprise, Wilson Bowden Services in a move that aims to give Motherwell Bridge in 2007 is Ltd and Tata Steel - described the the Lanarkshire engineering group a remarkable and is a suitable symbol planned development as “one of the “highly performing footprint in the of the ambitions of Lanarkshire. most important regeneration projects rapidly growing Asian market”. Another symbol of the in Europe.” The deal, which is expected to development of Lanarkshire is the He said: “The revised masterplan close in January, will see more than reflects the needs of the growing 100 specialist and technical staff community, with a focus on transfer to MB Aerospace to take We are constantly competing with high quality housing, a range of global headcount to more than 1,700 community and commercial facilities across operations in Europe. racecourses further south to attract and substantial green space, all of It is the latest phase of expansion top trainers and jockeys which will combine to deliver an planned by MB chief executive Craig enhanced quality of life for the local Vivien Currie, Hamilton Racecourse (below) Gallagher to expand the group’s community. capabilities in the aero engine turbine “Employment opportunities and compressor areas, with further lodging of an updated masterplan play a central role in immediate investment planned in Taiwan and for the development of Ravenscraig, development plans and conversations Newton Abbot in Devon. the site of the former major iconic are under way with potential It positions MB to take a growing steelworks, which closed in 1992 after commercial occupants.” slice of work on the global aircraft a 12-year political battle attempting The aim is for about 550 new fleet which is projected to double to save it. houses to be added to the 450 over the next 20 years. The plan submitted at the end of already completed to date, with The ACTS deal follows news in the October is a scaled down version of the new building expected to take summer that MB had won a 10-year that originally submitted in 2001. The place from next year until 2021. The contract with United Technologies plan, which includes proposals for housing plans are scaled back from www.insider.co.uk December 2017 INSIDER 55 REGIONAL REVIEW: LANARKSHIRE the original 2001 blueprint, which envisaged that 3,500 houses and flats would be built on the site. Amenities will include a 17-acre park and a new primary school that will be built when the number of homes on the site reaches 1,000. A significant step in improving the transport infrastructure of the area came in the summer with the opening of the M8 ‘missing link’ – the seven-mile section between Newhouse and Baillieston. The development means that the entire stretch between Edinburgh and Glasgow is now motorway. Speaking at the Maxim Business Park at Eurocentral when she opened the new stretch of road, First Minister Nicola Sturgeon said the additional road capacity would ensure the economy had room to grow. She said: “The M8 is a vital link in the central belt and this newly completed section will help connect people to business, leisure and education opportunities and also creates a better environment for North Lanarkshire Council companies to do business.” apprentices in Wishaw The development of infrastructure and attracting investment and at the heart of this project and have supporting businesses was one Apprentices are the future of every no doubt that the site will excel as a of three priorities that had been venue, taking Hamilton Park to the identified by North Lanarkshire technically-based business and we next level.” Council in its document Our Another significant bet on the Plan For Growth. The others place great emphasis on rising economic value of the area were increasing employment and came in May when it was announced improving the skills of the workforce encouraging school and college that Wirefox, the Northern Irish and, regenerating its town centres property investor, had acquired nine and communities. leavers to consider the semiconductor office buildings in six business parks Hamilton Park Racecourse industry for a rewarding career in a £35m deal. has unveiled plans for a multi- The properties include the current David Law, Ichor Systems (below) million pound hotel development IBM base in Cumbernauld, three in its grounds. The plan is for the buildings at Trilogy Business Park, 118-guest room property under the ranging world-class sporting 1 Forrest Gate at Tannochside Hampton by Hilton brand to be built attraction, whilst also providing a Business Park and Phoenix House on what is currently the main public fantastic facility for racing staff when at Hamilton International Business car park in the racecourse grounds. they visit Hamilton Park for our 18 Park on the edge of Blantyre. The directors of Hamilton Park race meetings. Wirefox said when it bought it that believe the £10m project will “We are constantly competing what it describes as the Rockford generate an additional £5.9m per with racecourses further south to Portfolio was 84 per cent let with year in additional visitor spending in attract top trainers and jockeys.” only the 65,000 sq ft Grade A Nevis the area generating £700,00 a year to She said that having a modern House at Hamilton International the economy with £400,000 of that in on-site hotel in addition to last Business Park being the only one still the South Lanarkshire economy. season’s increase of 15 per cent in the to secure a tenant. Vivien Currie, chief executive of prize money was part of wider new Ascensos, the Motherwell- Hamilton Racecourse, said: “The investment to attract new visitors. headquartered call centre operator project has been driven both by “This key project for Hamilton, its announced in May that it was public demand, largely from our inhabitants and many visitors will expanding its capacity by a third by local customer base, not only for encourage investment in the town opening a new contact centre in the racedays but for weddings and other and create jobs while enhancing the Isle of Wight in a move that it said events, and from racing personnel. Hamilton Park experience. would create 600 jobs. “With an on-site hotel, Hamilton “As a Lanarkshire business we John Devlin, chief executive Park Racecourse will further are incredibly excited by the core of Ascensos, said the move was enhance its reputation as a wide- economic and regenerative objectives a “major strategic move” for the 56 INSIDER December 2017 www.insider.co.uk REGIONAL REVIEW: LANARKSHIRE

company and that it was becoming “a Initially founded as a home bakery Above: My Cupcake another member of staff. force to be reckoned with in the UK in 2010, My Cupcake Toppers moved Toppers founder “As the business grew, we required contact centre sector”. In a continued into decorative and edible cake Anna Kennedy (left) a larger space to accommodate our programme of expansion Ascensos toppers two years later. with UKSE’s Jackie new equipment and Grovewood also said it hoped to create jobs at the Founder Anna Kennedy said the Taylor Business Centre was a perfect fit for Motherwell site within five years. move to Grovewood allowed the us. Not only is it ideally located for There was further positive job company to buy new equipment, staff travelling from Lanarkshire and news in the summer when HSBC which has streamlined production Glasgow, but UKSE provides a postal announced that it would create 500 and marked a turning point for the service through its central office.” jobs, some of which will go to what business. The area generally has seen a it describes as its centre of excellence “The growth we have experienced notable improvement in employment for customer contact in Hamilton, in the last two years has been over the last three years for which South Lanarkshire. incredible,” Kennedy said. “In figures are available. In the period Business creation in the area has addition to expanding production, from the 2012-13 financial year been supported by financial aid and we have been able to diversify our to that of 2015-16 the figures for help from UK Steel Enterprises, the products and have also recruited unemployed people helped in to body originally established by the work in North Lanarkshire increased British Steel Corporation to ‘put from 8.3 per cent to 31.6 per cent. something back’ into steel areas. The latter figure is the highest of One such business is a North all councils in Scotland over the Lanarkshire bakery, which has 2015-16 year. The figure for South doubled its sales over the past Lanarkshire was 16.1 per cent, which two years after moving out of its compared to a Scotland-wide figure founder’s kitchen into a 492 sq ft unit of 14.1 per cent for the period. in the Grovewood Business Centre This increase in employment in Bellshill, premises managed by in the area has created its own UK Steel Enterprise (UKSE). headaches for business with more in My Cupcake Toppers is now varying sectors complaining of skill delivering about 10,000 orders shortages. annually to its clients around the Ichor Systems, the Blantyre-based world, including in Singapore, electronics and silicon products Australia and Norway. Turnover in manufacturer and repairer is one the latest year for which there are full such company because of the figures hit £126,000 up 117 per cent eclipse of the once burgeoning on 2015. semiconductor industry in Scotland. www.insider.co.uk December 2017 INSIDER 57 REGIONAL REVIEW: LANARKSHIRE

This has led to a rising age profile of professionals in the sector with Clyde Wind Farm few new entrants coming into the microelectronics sector. To combat this David Law, the Ichor Systems operations manager is operating what he describes as a balanced approach to recruitment featuring apprenticeships, graduate entry and contract employment of experienced personnel. “Apprentices are the future of every technically-based business and we place great emphasis on encouraging school and college leavers to consider the semiconductor industry for a rewarding career. “However, it takes time to bring apprentices through and therefore we are adding to the mix with engineering graduates who perhaps are more academically advanced and can be slotted in to hands-on roles more quickly.” There was less good news on the jobs front in Lanarkshire, however, at the start of November when it was announced that specialist freight haulage business West of Scotland Heavy Haulage Ltd was had entered administration with The funding, which comes from the loss of 21 jobs. The business was The M8 is a vital link in the central Clydesdale Bank’s Renewable Energy founded in Cumbernauld in 1946 team and Scottish Enterprise’s and operated one of the largest fleets belt and this newly completed section Renewable Energy Investment of specialist heavy haulage trucks, Fund, will see an Enercon E53 trailers and low loaders in Scotland. will help connect people to business, 810KW wind turbine erected on More recently it had become one Marshill Farm. The local community, of the leading specialists in wind leisure and education opportunities represented by the Lesmahagow turbine haulage, as well as in the Development Trust, will bring wider renewable energies, mining, and also creates a better environment significant financial benefits, civil engineering and construction generating income for both Stewart sectors. for companies to do business and the community. The business failure is somewhat Nicola Sturgeon, First Minister of Scotland Kerry Sharp, director of the ironic given that Lanarkshire is Scottish Investment Bank, said: known as a renewable energy “This is an excellent example of how, hotspot hosting as it does the in focus: Lanarkshire economy view with the right tailored mechanisms 152-turbine Clyde Wind farm near such as REIF, renewable energy Abington in South Lanarkshire Anne Clyde, regional manager for UK Steel Enterprise, formerly projects at local level can be British Steel (Industry) Ltd, is well placed to take a long-term view which is capable of powering as delivered, resulting in direct positive of the progress of the Lanarkshire economy. many as 300,000 homes. The 350 Originally established in 1975 by the British Steel Corporation impacts on community development megawatt wind farm built either side and now a subsidiary of Tata Steel, Lanarkshire is one of the key and the creation of new economic of the M74 motorway was officially areas to have benefitted from UKSE’s sustained, direct investment opportunities.” opened in September 2012. in local businesses, as well as the provision of significant office and The Marshill Farm project follows Lanarkshire also hosts the worship space. other schemes to allow communities 54-turbine Black Law wind farm Clyde says: “Lanarkshire is a tremendously diverse and vibrant in Lanarkshire to own a stake in which sits on top of a former economy and its work ethic and skills base is a great foundation for renewable energy. The Spirit of opencast coal mine. It can meet the growth. We have provided hundreds of businesses with funding, Lanarkshire Wind Energy Co- average electricity needs of 70,000 guidance and premises and that combination is a proven formula operative allows local people to have homes per year, with a total capacity for success. On average, the companies we back with equity a stake in wind farms at Nutberry of 124 megawatts. funding increase turnover by 300 per cent and staff numbers by 40 near Coalburn and West Browncastle per cent, underlining the potential within Lanarkshire businesses. There are also smaller projects near Strathaven. Developer Falk “There was a time when some people feared the reduction in being added with Lanarkshire farmer Lanarkshire’s heavy industries would signal the death knell for Energy built the wind farms with Andrew Stewart, owner of Marshill the county, but that’s now far from the case. The diversity and cooperative arrangements being Farm in Lesmahagow, having innovation in the local economy is stronger than ever and that offered through Energy4All. secured £1.5m in funding to build a bodes really well for the future.” The offers run in 2013 and 2014 new wind farm on the land. respectively were fully subscribed. ■ 58 INSIDER December 2017 www.insider.co.uk

SPONSORED FEATURE: BGF BGF UNDERSTANDING OF MARKET DYNAMICS BUILDS STRONG BOND A £3m investment by BGF into Campion Homes last year is having a huge positive impact on the latter. Here, we find out more about the two parties’ relationship...

Campion Homes’ Susan Jackson on BGF BGF’s Patrick Graham on Campion Homes

CAMPION HOMES was these three private developments BGF ALREADY had to trade through. We took founded in 1989 in Dunfermline out of the ground. some experience of the great comfort from that. by my father Peter Bell and We are of a size that means we housebuilding sector when we We also liked the fact that his then business partner. I can be nimble and adaptable. We came to back Campion Homes, Campion has a good mix of joined four and a half years ago, believe that houses should be as through Braidwater Ltd, a existing private and social originally as finance director, and individual as their owners, and company in Northern Ireland. housing developments with a now joint managing director, so it we have invested heavily in what Therefore, we knew a bit about strong land bank of future sites. has only recently become a family we call a “Choices Suite”, whereby the environment in which As a result, we could clearly see business! buyers can choose a significant Campion Homes is operating that our funding would unlock We build in East Central amount of the specifications of as the Northern Irish housing growth. Scotland including Fife, their houses. Our overriding goal market is, in some ways, similar We discovered that Campion Clackmannanshire, Perth & is to maintain the quality of the to Scotland - an undersupply don’t build to a one-size fits Kinross and Angus and we product and the quality of the of housing, strong customer all model, there are many work in all areas of the housing service, as that’s how we have got demand, and price growth. different options in terms of market, private housing and social to where we are today. Through Campion we saw an house styles and a suite of housing. Last year was a significant step opportunity to back a regional further choices. It’s an attractive BGF made a £3m investment in for us – as a business we doubled housebuilder in Scotland with a level of service. July 2016, which helped us greatly turnover due to increased levels very solid platform for growth. Since our investment, as conventional bank funding of activity. Inevitably growth What attracted us Campion Homes has wasn’t able to support the level has its challenges but we have about Campion Homes? performed extremely well, of growth we anticipated in our recruited some great people Fundamentally we liked Peter, doubling in size with strong private housing division. Banks to work alongside our existing Susan and the wider team growth prospects ahead. tend to look at each development team to support expansion. We both from a personal and Although we hope to on an individual basis but that will continue to grow, though of professional perspective. generate a strong return from wasn’t going to allow us the course we won’t be doubling in The business is run in an our investment in the business, growth that we could achieve size every year! extremely professional manner given BGF’s long-term patient with a longer-term partner The personal contact that with a good breadth and approach to investing, we who understood our strategic BGF offers is very positive. We depth of experience across the are not prescriptive around ambitions. have been building a strong organisation with the majority timeframes. In the last year we were relationship with Paddy Graham of people having worked Our focus for now building on three separate and that will continue to develop. together for a number of years. is working alongside development sites which was It is a big advantage to have an This was evidenced during Campion’s management very challenging financially. BGF investor who understands the the last downturn, which the team as the business grows finance supported us in getting dynamics of the market. business successfully managed and helping where we can.

BGF initially invests between £2m and £10m into a business in return for a minority equity stake and provides follow-on funding to support further growth. The companies BGF backs are privately-owned or publicly listed, and typically have revenues of between £5m and £100m. 60 INSIDER December 2017 www.insider.co.uk BUSINESS PROFILE

TRAINING AND DEVELOPMENT KEY TO EXPANDING DACOLL’S GLOBAL REACH Multi-award-winning business Dacoll Limited contracting. They are now the largest independent operates from an unassuming head office in provider of IT Services in Scotland today and a the heart of Bathgate. Dacoll was established manufacturer of innovative technology that is in 1969, when Chairman Brian Colling spotted exported world-wide. an opportunity to provide mainframe Their 2020 plan for growth has shown that computer support to Glasgow University when their strategic move out of IT maintenance and bigger players in the field ceased maintenance into profitable, long-term managed services America, Singapore, Tunisia, the Middle East, and services. Amongst other attributes, it’s this provision, is already paying off. There’s been a more. But the Company has never lost sight of eye for opportunity and horizon scanning that 15 percent increase in turnover in the plan’s first the fact that business transformation is delivered has driven the business through the past four full year alone. High profile customers have sat by its people first. There’s a distinct emphasis on decades. up and taken notice, often choosing Dacoll over enabling staff, and getting them to the role that Dacoll is an unashamedly family business. the big corporates. Such clients, like anybody, are fits best. To make this happen, and to sustain Three generations of the Chairman’s family looking for cost-effective and high-quality services, their current growth, the Company has prioritised currently work in Dacoll’s offices today, and it’s but – crucially – seek the added agility that SMEs training and development to help staff to take on not unusual to see parents and offspring working provide. new roles and identify emergent skills. just a few corridors apart. Many of the staff have As a result, Dacoll’s Bathgate Service Desk Managing Director Allan Everington explained worked there for twenty years, some for thirty has expanded and there is capacity for yet more that “Dacoll’s ethos is certainly built round a core years and more. growth. With the re-introduction of hi tech set of values – that people, families, and stability Family values, long service and investment manufacturing to their Scottish site, the company matter – even when we’re chasing opportunity. in apprenticeships for young people. Not your has begun the development and manufacture But it’s not just the employees who benefit. Time classic recipe for a ground-breaking, contemporary of its own cameras and software for Automated and again, Dacoll’s many clients cite the Company’s company competing in a challenging and often Number Plate Recognition (ANPR), a key tool in approachability, its attitude and its responsiveness cut-throat marketplace. Yet Dacoll are a leading the national security portfolio both at home and as deciding factors in putting business our way.” global marketer and manufacturer as well as abroad. It appears that humanity and profitability are an award-winning provider of Information From their West Lothian base, Dacoll now not mutually exclusive. It is Dacoll’s people and Technology Managed Services, Network have a global reach, with customers from Ireland the culture in which they thrive, that sustains the Infrastructure installation, Cabling and Electrical through to Portugal, Scandinavia, Australia, Company’s steady growth.

Contact Us: Dacoll House, Gardners Lane, Bathgate EH48 1TP Tel: 01506 815000 or visit www.dacoll.co.uk IT MATTERS: communication

TECH PUTS FACE-TO-FACE ENCOUNTERS ON THE BACK SEAT

By BILL MAGEE abbreviations like IoT, AI, VR, AR, our business affairs.” He claims this and VoIP continue to be bandied will have profound ramifications for ne thing’s for sure about. organisations seeking to provide that - 2018 is set to hammer What does all this new tech have vital “competitive differentiator” as home how mobile tech in common? They’re dovetailing new mobile products and services Onow runs the show when towards that quite addictive pocket- are released to market in the shortest it comes to running a successful sized personal computer that possible timescale. business. becomes thoroughly embedded into “Any brand or business committed Trouble is hard-pressed executives to such rapid innovation must and their teams may find it even understand the consequences of such harder to keep pace with the deluge Fast reactions to problems are new and emerging technologies.” of digital advances coming their way. A key question filling the minds During a typically 24/7 working required almost every day so it would of analysts and academics alike is day we now compulsively immerse whether the smartphone is now so ourselves in - very much as second be difficult to resolve issues with my addictive it’s eroding precious time nature - smartphones, tablets plus to actually meet and discuss the next other mobile devices. colleagues at SQA on the spot without step in that big business idea. That Finding time to take breaks email, IM and calls all on the one device the traditional face-to-face encounter to indulge in a daily dose of is increasingly taking a back seat. Lauren O’Hare, SQA (below) entertainment like Pokemon plus A University of Essex study occasionally checking out what’s divided 142 participants into pairs to happening in the world. our commercial subconscious. converse in private for ten minutes. But it can seem, well, a bit like Chris Martin, chief executive Half had a mobile, the others no technological overload with no time of mobile apps specialist Waracle, handset. to actually think in what has become says: “The technological trends that It was quickly found the labelled the smartphone society. have helped to shape the previous mere presence of a phone led Gfk market research reveals decade will continue to rapidly to a disconnect inhibiting high-end mobiles are about to evolve and radically alter the way interpersonal closeness, empathy get even pricier as tech buzzword we develop software and conduct and understanding, both from and 62 INSIDER December 2017 www.insider.co.uk IT MATTERS: communication by each other. Add to this a Gallup challenge. “IDC predicts over the survey revealing ever-growing next three years one-third of the top numbers of market leader iPhone 20 countries in every industry will be owners couldn’t imagine life without ‘disrupted’ by new entrants. their smartphone, especially with “While this doesn’t necessarily Face ID on the horizon. mean they will go out of business… So do smart devices actually revenue, profits and market position hamper, rather than help, skills and will be under threat.” with them relationships? SQA IT The managing director of Capito, project manager Lauren O’Hare the IT services and solutions believes it’s possible to strike a business, Alan Middleton told a balance. Scottish Business in Parliament “Fast reactions to problems are conference: “It must be all about required almost every day so it would evolving your commercial and be difficult to resolve issues with tendering processes. my colleagues at SQA on the spot “Here, collaboration with other without email, IM and calls all on the organisations and their frameworks one device. can help gain access to new business.” “This is especially the case as my In Capito’s case Scottish Procurement organisation is based across sites mobile client devices and desktop and encourages flexible working computing contracts in partnership making it impossible not to rely on with HP. my phone. “The crucial point is to have “That said, I don’t underestimate confidence in the ability and security the value of face-to-face meet-ups. of how your innumerable document As a better way to guarantee your sources are handled by systems.” message is being understood and Fraser Nicol, head of business and representing a good basis to build technology consulting at Scottish and develop relationships.” firmScott-Moncrieff , believes Given her job, O’Hare supports that organisations are more aware full integration of mobile tech in of cyber attacks: “But many seem everyday working lives. unsure if their (IT) investments have “But I do hold onto the sentiment been effective and unclear what to do face-to-face interaction still very to recover their losses in the event of much has its place even in this an attack.” modern technology-driven business However, as we frantically use w or l d .” up our smartphone airtime talk What about those abbreviated minutes, roaming freely and sending tech advances? Like IoT (Internet of By all means use your mobile... but multimedia instant messages like Things), AI (artificial intelligence) there’s no tomorrow, we should with developments in speech also heed his advice: use your brain, perhaps pause and spare a thought in recognition and machine learning, this digital age. and AR (augmented reality) where that’s what drives success Reuters Foundation fellow Chris the user’s existing environment Chris Holme, Reuters Foundation (below) Holme says: “Meeting over a cuppa is cleverly overlaid with new has always had a key role in forging information in real time. On the augmented reality front business relationships. One IT leviathan, Dell where real and virtual worlds “Often, this occurred in one of Technologies is concentrating become even more enmeshed, the many Lyons tea shops across strategically on IoT and AI. Dell Waracle’s Martin predicts: “The Britain and, curiously, it was Lyons EMC chief Michael Dell says this year ahead will witness mobile AR that developed the first computers to reflects: “An age where every type of tipping into mainstream consumer carry out payroll and other back- device, from phones to cars to oil rigs consciousness…redefining the way office functions.” to robots to heart monitors are alive apps are developed.” Holme, founder of The History and intelligent.” A key factor is how to cope with an Company, concludes: “IBM It’s now all about real time exponential explosion of information founder Thomas Watson, whose decision-making and processing of as the EU General Data Protection father hailed from Edinburgh, was information. “These devices simply Regulation (GDPR) signals a new era the entrepreneurial genius who cannot wait for a response from of compliance from May 25. motivated staff with his celebrated centralised cloud infrastructure that IT consultancy and services Think! campaign. may be seconds away.” Exception’s chief executive Scott “By all means use your mobile...but Moor Insights & Strategy McGlinchey, in an IoD Scotland also heed his advice: use your brain, principal analyst Patrick Moorhead technical briefing, points to an that’s what drives success.” says the approach makes sense: International Data Corporation So, during the working day it is “Especially with 75 billion new IoT market research warning that possible to combine that smartphone end-point devices (installed) by many organisations are not moving with using one’s brainpower. If we’ve 2025.” fast enough to address this digital a mind to... ■ www.insider.co.uk December 2017 INSIDER 63 INSIDER INTERNATIONAL: singapore A GREAT STARTER BASE FOR THE ASIAN MARKETS By PERRY GOURLEY

lthough factors such Scotland’s 16th largest export market as the widespread use with £525m of goods and services of English and a lack of heading there last year. Abusiness bureaucracy Dog Digital took the decision to means Singapore is known as ‘Asia for open an office in Singapore in 2012 beginners’, digital communications after working in the region on behalf boss Gerry McCusker cautions that of a client. the challenges also shouldn’t be With Singapore having developed underestimated. into the main hub for marketing “The distance, cultural contrast across Asia Pacific with a growing and time difference are all very number of major brands setting up and businesses may well find margins significant factors in trying to bases there, it was an attractive place less than they are used to elsewhere. do business there,” points out to be for a firm with international After five years of operating an McCusker, who heads Glasgow- expansion ambitions. office there, Dog recently entered based communications agency Dog From the outset the company a joint venture with creative digital Digital. agency RHAD in Singapore. His firm is one of more than 60 The joint venture brings Scottish businesses which have Employing local staff was the together an experienced team established operations in Singapore across Singapore, Jakarta, Mumbai along with the likes of Skyscanner right way to build the business in and Ahmedabad with around 40 and Standard Life Aberdeen. employees. Although geographically a culture where relationships are “The new partnership enables constrained – the island city state is both partners to tap into extended Gerry McCusker, Dog Digital (above) only about 30 miles wide by 15 miles very important skillsets and draw on their respective long - Singapore is far from being a strengths, experience and capabilities small market. looked to staff the operation with to gain competitive market Its population of just more than 5.6 local employees rather than expats. million puts it on a par with the likes “There is obviously a big expat FACTi FILE: Singapore of Scotland, Norway and Denmark presence in Singapore but we felt An estimated 17 per cent of Singapore’s and its location provides access to a it important to have an in-depth adult residents are thought to be market of 600 million people across understanding of the market and the millionaires, making it one of the world’s South East Asia. It also serves as a networks. Employing local staff was richest nations. financial, shipping and trade hub for the right way to build the business in High disposable incomes for many of the whole Asia Pacific region. a culture where relationships are very its residents mean eating out is regarded Although there are significant important,” explains McCusker. as something of a national pastime with cultural differences in a market But recruiting and retaining staff more than 2,400 restaurants. which is about 11,000km away, on an island which effectively has A growing appetite for high quality Singapore is regarded as one of the full employment also brings its western food and drink products means it is a key target market for increasing most straightforward markets for challenges. Scottish exports. western firms to look to establish “The workforce there is very Scottish producers sold more than themselves in. transient and people will often move £1bn-worth of food and drink to Asia With a stable government and jobs within months,” he says. last year, up by seven per cent on the robust legal system, it is ranked by Although the opportunities in previous year with Singapore one of the the World Bank as the second easiest Singapore itself and the markets biggest buyers. Latest figures show that place in the world after New Zealand it provides a stepping stone to are the value of Scotch whisky shipped to to start, run and do business. significant, McCusker also says it is a Singapore in the first half of 2017 rose by That has helped it climb to be surprisingly price-conscious market 13 per cent to £112m. 64 INSIDER December 2017 www.insider.co.uk advantage, and better serve existing challenges of having an operation Above: China, Japan and India. clients across South East Asia,” says there. “It is an expensive city to be in, Singapore According to Mark Leisegang, McCusker. particularly if you are using expats Jubilee Bridge general manager for the operation, Singapore’s position as a shipping and having to pay for their housing Singapore was “absolutely the right hub for the region saw Glasgow- and so on.” Below: place” for the company to establish its Ian Livingston, based Clyde Marine Recruitment Clyde Marine has since established first physical presence in Asia. Clyde Marine establish an office there five years ago. a partnership operation with a local Recruitment “It is very much Asia-lite given “At the time the oil price was still firm and has also recently worked in education here is all done in English. riding high and we got off to a good conjunction with Singapore software But 70 per cent of the population also start by winning a couple of big developer ServiceDott to launch an speak Mandarin as a second language contracts out there,” recalls managing app that aims to make life easier for so that makes it a very good place to director Ian Livingston. seafarers by managing the wide range be to access the Chinese market,” he “We have found it a good place of certificates they need when setting explains. to operate in terms of stability sail. “Within seven hours you can also and transparency and you can be “The partnerships we have be in Sydney to the south or Tokyo to very confident about not coming established means we have still got the north.” up against corruption issues,” says a presence in the market there but As an ex-pat with a young family, Livingston. without the same overheads and we Leisegang also finds Singapore a good “The Government there is also are well-positioned for a recovery in location to work in. very business-friendly which I think oil prices.” “There is a lot of focus on having a is helped by the fact that they make a Dundee learning and development positive work-life balance here and it point of civil servants and politicians company Insights also opened an is an incredibly safe place to live – I spending time in industry.” office in Singapore in 2016 in a move honestly think you could walk down But the impact of the oil price aimed at building a bigger presence the street here at 2am in the morning crash followed by the fall in the in Asia and to provide a springboard laden with jewellery without any value of sterling exacerbated the cost into markets yet untapped, including problems.” ■ www.insider.co.uk December 2017 INSIDER 65 Monday Tuesday Wednesday Thursday Payday.

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Call Peter McDermid on 07717 752125 or visit lendinvest.com/borrow. LendInvest Limited is registered at 8 Mortimer Street, London, W1T 3JJ (Company 08146929). ICO number ZA179467. Your property may be repossessed if you do not keep up repayments on your mortgage. COMMERCIAL PROPERTY: FEATURE

he UK is the digital capital of Europe for tech One Lochrin Square, Edinburgh investment, skills and Tcollaboration, according to the Tech Nation 2017 report. Total digital tech investment reached £6.8bn last year, 50 per cent higher than any other European country. Tech industry turnover was estimated at £170bn in 2015, a 22 per cent increase in five years, and digital tech businesses grew in number by 28 per cent, twice as fast as non- digital businesses, says the report from Tech City, a body launched in 2010 to support East London’s Silicon Roundabout but which now supports major UK cities. Nearly 70 per cent of last year’s digital tech investment was in regional clusters outside London, one of which was Edinburgh, which attracted £159m, ahead of Cambridge, Oxford and Manchester. The number of digital jobs in the capital is more than 25,000. ‘Tech’ is defined as information and communications technology which the property sector TMT REMAINS CAPITAL’s classifies as technology, media and telecommunications (TMT). This was Scotland’s second most FASTEST-GROWING important business sector for office take-up last year, only four SECTOR FOR OFFICE SPACE percentage points behind public services and health. TMT accounted By FRANCIS SHENNAN up hubs of the School of Informatics for 17 per cent of the total, according and Appleton Tower, where there to Savills’ Market Watch. are fledgling tech businesses and When it comes to the capital, We’re already seeing some offices 1,375 computer science students, though, it is Edinburgh’s fastest- and Codebase, Europe’s largest tech growing sector, according to Oxford change their internal characteristics, incubator. Economics, with a gross value added The scale-up hub areas are (GVA) of £1bn and growth projected adopting more collaborative, open Quartermile, close to Edinburgh to 2022 of 22 per cent. Employment University, the core city centre and is forecast to grow seven per cent to spaces and exposed ceilings – quite Leith. International companies 2022. locating at Quartermile include “Nearly a third – 30 per cent different by Edinburgh’s standards Cirrus Logic, FanDuel, IBM and – of all office space transacted Toby Withall, Knight Frank (below) Skyscanner. In Waverley Valley are across Edinburgh in 2016 involved Amazon, Microsoft and Rockstar businesses working in technology, hotels and retailers to professional North, and at Tanfield are Avaloa, media or telecoms, compared with a services and manufacturers. Craneware, Dell SecureWorks and UK average of 16 per cent,” says Ben “The combination of financial FNZ. Reed, director at JLL in Scotland. heritage and tech innovation should Tech City and data partner JLL “For a second year running, TMT provide the perfect breeding ground reported the city’s office vacancy rate occupiers were the most active for the next generation of fintech was 4.4 per cent, the lowest since business segment in Edinburgh. firms in Edinburgh. The tech 2008, with the top-quality office “Technology is no longer a discreet revolution is fostering new types vacancy rate at 1.8 per cent. Prime silo – it is now an indistinguishable of occupiers, new ways of working, office rents of £31 per square foot per part of every sector. Today 44 per new kinds of workspaces and new annum were forecast to rise by 3.2 cent of UK tech workers are now expectations from office buildings.” per cent by the end of this year. employed at ‘non-tech’ firms from Prime locations include the start- “Demand is coming from a variety

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www.insider.co.uk December 2017 INSIDER 67 COMMERCIAL PROPERTY: FEATURE

of sub-sectors within TMT,” says The Whisky Bond, a former bonded warehouse at bodies and universities to build and Toby Withall, office agency partner Speirs Locks in Glasgow design the type of accommodation at Knight Frank in Edinburgh, tech occupiers are looking for,” says “including the city’s burgeoning Withall. fintech scene, gaming, and software- The Whisky Bond, a former as-a-service providers among others. bonded warehouse at Speirs Locks Their emergence as a mainstay of the in Glasgow, houses creative and capital is driving change in the office innovative businesses. “The TMT market. sector is growing quickly in Glasgow,” “We’re already seeing some offices says the Bond’s Fiona MacFadyen. change their internal characteristics, “It is giving Edinburgh a run for its adopting more collaborative, open money by offering bespoke business spaces and exposed ceilings – which space that not only fully supports is quite different by Edinburgh’s the needs of these businesses, but usual standards. An example of this crucially, allows them to easily in practice would be One Lochrin expand and contract. Square, where exposed ceilings on “This sector has very specific needs the ground floor are specifically from a building, such as super-fast targeted at tech companies, while internet speed, 24-hour accessibility the other floors are finished more and fast onsite support. Traditional traditionally and could appeal to Within the radio industry we’ve seen a office space is just a ‘no’…shared professional or financial services.” common spaces and easily scalable The first floor was recently taken lot of restructuring and consolidation space is the norm for this sector.” by Ctrip, owner of Skyscanner, as a The property requirements of call centre to open early next year. of operations, as stations feel the traditional media companies have Movement in TMT tends to also been changing. be faster than in other sectors. As squeeze on advertising revenues “Within the radio industry Ryden’s 80th Scottish Property Roland Smyth, CMS (below) we’ve seen a lot of restructuring Review noted this summer, Cirrus and consolidation of operations, Logic continued its expansion at and Stirling. as stations feel the squeeze on Quartermile 4 where it now occupies “It’s time landlords, developers and advertising revenues,” says Roland a total of 10,219 sq m after adding investors started to build this into Smyth, real estate specialist at law 2,105 sq m on the fifth floor. This their project specifications. Not only firmCMS . was assigned from FanDuel, who will their customers benefit, they too “Global Media Group, owner of consolidated into 925 sq m in will enjoy higher property valuations Capital, Heart and Smooth Radio, Quartermile 1, also assigned 1,229 sq – estimated at around three per cent recently consolidated its Scottish m on the sixth floor of Quartermile 4 higher – and rental yields.” operations, moving from different to Bank of Montreal. Another is collaboration and locations across Glasgow, including “From a landlord’s perspective, co-location – taking an office in an Pacific Quay and Baillieston, to an they are having to offer more existing cluster to access a large tech entire floor in central Glasgow’s flexibility,” says Simon Capaldi at ecosystem – and agile offices. This prestigious 1 West Regent Street. Knight Frank. is connected to the small business “A decade earlier we saw similar “While they typically look for 10- nature of the sector, with 90 per cent moves within the TV industry when year commitments from traditional of property deals involving small STV and BBC Scotland disposed of occupiers, tech companies will want firms. older bases to relocate to modern to cut that in half, allowing them to It has led to new development headquarters at Pacific Quay.” facilitate their growth in a shorter strategies. “University of Edinburgh That has developed into Scotland’s timeframe.” has been very proactive, grasping the most important media cluster. Among the property needs that nettle and becoming a ‘developer’ Another media/tech cluster is Tech City identified in Edinburgh in its own right,” says Withall. developing at Clyde Gateway, was connectivity. Edinburgh became “For example, the university has especially in the Albus building the UK’s first capital Gigabit City transformed the former Surgical where creative agency Made Brave, project in 2015 as construction began Hospital at Quartermile, which publishing company Peebles Media, on a 150km pure fibre network. will be carefully renovated Cloud Cover IT and School Cloud “Businesses are becoming and transformed into a new Systems are now based. increasingly dependent on quality interdisciplinary hub.” IT company School Cloud was connectivity,” says James McClafferty, Edinburgh is in the lead in TMT set up by two 16-year-olds while head of regional development in but it is not alone. “Across the M8 still at school and recently won Best Scotland at CityFibre, which has in Glasgow, we’ve had cases of Performing Business for one to 10 been building new full-fibre networks private developers undertaking joint employees at the Glasgow Business in Edinburgh, Glasgow, Aberdeen ventures with economic development Awards 2017. ■

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68 INSIDER December 2017 www.insider.co.uk PROPERTY: NEWS COMMENT

Peter McDermid Business Development Permission granted for new prison Manager, LendInvest Do pass go and go to jail – Colliers Artist’s impression of the new prison Tel: 07717 752125 International on behalf of the Scottish E: [email protected] Prison Service has helped to secure W: www.lendinvest.com planning permission in principle for the first new prison in the Highlands for 112 years. Rental revolution is good The firm worked alongside a Senior economist Sebastian Burnside specialist consulting team, including recently predicted that by 2025 there will BakerHicks, ITPEnergised, be more private renters in the UK than engineering company Fairhurst, homeowners with a mortgage. But in TGP Landscape Architects, AOC my view, a lot of the worry this raised has Archaeology and ERM Consulting, been misplaced. on the prison planned for land result,” said Colliers senior planner There is no doubt that we aren’t the south of Inverness Retail and Meabhann Crowe.” It ensures the building enough homes and that steps Business Park. It will replace HMP Highlands, Islands and Moray areas need to be taken to make this process Highland in the city centre. will get a much-needed modern, easier for first-time buyers. But we also “Given that the proposal represents fit-for-purpose prison in a timely need to move away from the concept a technical departure from the manner. We expect construction of home ownership being the be-all Development Plan, this is an excellent work to begin early next year.” and end-all. It is a very British thing, this obsession with owning your own home. On the continent, choosing to rent rather than buy is seen as a more acceptable Scottish Enterprise assets marketed choice to make. Yes, some people are A large, diverse portfolio of Park, two small sites in Dunfermline, renting because they cannot afford to commercial property assets ranging and a 12-acre site in Lockerbie. buy, but it would be wrong to assume from potential development sites to “Thisinstruction has some sites that in that is the case for all tenants. small strips of land is being marketed many cases are quite unique, with some Figures show that the Scottish rental by Shepherd Chartered Surveyors for of the smaller lot sizes having generated market has remained strong over the Scottish Enterprise. interest from parties seeking alternative last year. Returns for landlords are It includes four development plots of investment opportunities,” said Sandy competitive, with the latest Your Move up to 27 acres in Old Kilpatrick close to Lightbody, head of agency (Glasgow) at Scotland Buy-to-let Index reporting the Auchentoshan Distillery, a nine-acre Shepherd. average rent across the country to be site in Clydebank next to the Golden “Indeed, with some of the land- at £574 pcm with the typical landlord Jubilee National Hospital, 35 acres at holdings backing on to existing seeing returns of 4.8%. If we are to build a healthy market, Starlaw Park in Livingston, five roadside residential plots, we have already then the needs of tenants must be taken development plots of between 0.5 acres received enquiries from householders into account, rather than the focus being and 2.5 acres in Cambuslang Investment keen to extend their garden plots.” on home ownership. This December, renters in Scotland receive a boost here as a number of sweeping reforms come Barratt acquires 10 new sites into force. These changes are some of the biggest the private rented sector has seen Barratt Developments Scotland and offer tenants in Scotland substantial has acquired 10 ten new sites for protection - both from eviction as well as development with space for 1,400 rent increases. homes and is planning to acquire Scotland has long led the way in rental another 11 with space for 1,830 new reform in the UK and we should welcome homes. this new legislation for both tenants Since the summer, it has recruited and landlords. It just remains to be seen more than 20 graduates and whether such sweeping improvement apprentices and 45 additional will be rolled out to the rest of the tradesmen. Over the last financial country. year it completed 1,700 homes, up Doug McLeod, Barratt nine per cent on the previous year. To find out how LendInvest could From April to September this from first-time buyers through to help progress your next property year the Homes for Scotland downsizers, and we’re receiving a project, call 07717 752125 or visit ‘Housebuilder of the Year’ – which consistently high level of enquiries lendinvest.com/borrow includes the Barratt Homes and and reservations across our David Wilson Homes brands – has divisions,” said regional managing bought sites from the Central Belt director for Scotland Douglas to Inverness, with the main focus on McLeod. “That demand is unlikely to the Glasgow and Edinburgh areas. let up, given Scotland’s requirement “Demand for new homes is still for new homes to meet population strong among all types of buyers, growth.” www.insider.co.uk December 2017 INSIDER 69 Packages from £70.00 per person

Call 0141 626 0062 for tickets & information EVENTS: MADE IN SCOTLAND AWARDS

Your chance to shout about what you make in Scotland

n changing times the size and in any sector which innovative products and services to quality of our goods and demonstrate innovation within be designed and manufactured in services and the strength the design and/or manufacturing Scotland by exhibiting at the event. Iof our brands will be key to process which contribute to Chairing the judging panel Scotland’s future. extending product life cycles this year will be Ross Martin, Scottish Business Insider’s Made and diverting waste from landfill who chairs a number of public in Scotland Awards exist to mark through reuse. and private sector bodies and is and celebrate the best of what The judges will be looking for a former chief executive of the Scotland has to offer in this area. examples of products or processes Scottish Council Development and Back for its third year, the Made that demonstrate an economic, Industry. in Scotland awards in partnership environmental or cultural impact He said: “The Made in Scotland with the Advanced Forming in Scotland. Any process or Awards are the annual celebration Research Centre champions product whereby an item is reused, of our continuing contribution to all aspects of transformational remanufactured or refurbished the global economy, showcasing discoveries and developments to extend its lifecycle is eligible to how we’ve built on our long made in Scotland. apply. held reputation for invention to In an ever more crowded Initiatives in Scotland are at the increasingly become an innovation marketplace organisations must leading edge of the moves towards nation.” introduce new products and a circular economy and this award “The awards are recognition processes to stand out. Scottish will celebrate those, with the award of the creativity which we find Business Insider invites innovative sponsored by the Scottish Institute in every corner of Scotland, companies and individuals for Remanufacture. throughout every industrial sector, that have found success both The Made in Scotland Awards examples of innovation that will domestically and internationally to will take place on 26 April 2018 at drive much needed productivity enter the Made in Scotland Awards the Glasgow Science Centre. With gains across our economy. and have their contribution over 200 guests attending it is an “The MiS Awards are, quite recognised. ideal opportunity to showcase literally, Made in Scotland and I To mark changing needs and some of the best and most hope to see you playing your part priorities the Made in Scotland in them.” ■ Awards 2018 will for the first time include a Remade in Scotland Business Insider invites innovative Award. More information about the The new award will highlight companies and individuals event can be found at www. and support Scotland’s drive to insidermadeinscotland.co.uk. create a circular economy where that have found success both To exhibit at the event, book tickets one business’s waste becomes or discuss sponsorship opportunities another’s raw material. domestically and internationally to please contact Caroline Miller on The Remade in Scotland Award enter the Made in Scotland Awards [email protected] or call is for Scottish companies of any 0141 309 3133.

www.insider.co.uk December 2017 INSIDER 71 EVENTS: SCOTTISH ACCOUNTANCY AWARDS

Campbell Dallas continues growth path after awards win

t has been a dramatic year outstanding achievements. Accountants who have qualified for Campbell Dallas, winner Finance Director of the Year: within the last five years and who of the Large Accountancy The Panel is looking for finance have demonstrated leadership, IFirm of the Year trophy in the directors who have provided contributed to strong growth, Insider Accountancy Awards 2017. significant contribution to the presented innovative solutions and The firm, which had been development of their company demonstrated good client service. selected for the award partly or organisation and perhaps have Restructuring Team of the Year: because of clocking up a 35 per made their mark with some special For an insolvency practitioner cent increase in fees in the five achievements. The organisation which has successfully assisted years to 2017, has ambitions on must be a head office or a companies in distress and even greater growth in the years subsidiary but it must be based in produced the best possible ahead. Scotland. outcomes in the circumstances. Campbell Dallas joined with Emerging Finance Director Tax Team of the Year: For a team Baldwins Accountants, part of of the Year: Candidates for which must be client-focused and the Cogital Group, in a deal for Emerging FD of the year are likely able to present good results for an undisclosed sum in a move to be showing long-term potential their clients. Innovative solutions that aims to further the ambition in their first FD role, there is no will also be considered. to become a bigger player in the specific age limit. He or she will Corporate Finance Team of the accountancy sector. have contributed significantly to Year : For a team which must be This category will again be hotly the development of the company client-focused and able to present contested in the coming year’s or organisation. good results for their clients. awards. The categories are: Public Sector Finance Team Innovative solutions will also be Accountant of the Year: For an of the Year: The winning team considered. outstanding individual in either will be one which has made an The Insider Scottish the private or public sector in outstanding difference/major Accountancy and Finance Awards Scotland who has made his or her impact to the public sector 2018 will take place at the Grand mark in accountancy particularly organisation which it is part of. Central Hotel, Glasgow on during 2017. Young Accountant of the Year: Thursday 14 June. The occasion is Large Accountancy Firm a highlight of the accountancy and of the Year: For a firm which finance calendar.■ has enjoyed an exceptional year The Large Accountancy Firm of in 2017 and demonstrated its outstanding achievements. the Year is awarded to a firm which More information on the Small Accountancy Firm event can be found at www. of the Year: Accountancy firms has enjoyed an exceptional year in scottishaccountancyawards.com. To with fewer than 50 staff in 2017 and demonstrated its book tickets or discuss sponsorship Scotland. For a firm which has opportunities please call Sharon enjoyed an exceptional year outstanding achievements Tonner on 0141 309 3054 or email in 2017 and demonstrated its [email protected]

72 INSIDER December 2017 www.insider.co.uk EVENTS: SME AWARDS

AWARDS 2018 Celebrating the best of Scotland’s growing SMEs

eading contenders for retail outlet on the Royal Mile in cut down on the time it takes the Insider SME Awards Edinburgh. to go from concept to delivery 2018 have had a positive The site “virtually next door” to of the company’s hand-made Lyear. the world heritage site Edinburgh presentation packaging. Morton Fraser, which claimed Castle enjoys a footfall of four These are just three examples the top spot in our SME300 million plus a year. of the business wins, notable rankings that we carried in our Coming at 48 in the SME300 achievements and investments September magazine, said it was rankings, McLaren Packaging by businesses in Scotland’s SME reaping “Brexit positives” when it announced a notable investment Above: Chris Harte, community. announced a 2.5 per cent rise in of £3m in the construction of Morton Fraser It is just these kind of examples revenues in the financial year to a new facility for its Blue Box of performance that are marked April. Design subsidiary in Stirling. and celebrated in the SME300 The firm, led by chief executive The project – which is being Awards. Chris Harte, said it has seen supported by a Regional Selective The awards are open – like the “several positive outcomes” from Assistance grant – will create a SME300 index – to businesses the Brexit referendum, including new 20,000 sq ft manufacturing, with annual turnover of between a “notable increase” in corporate design and testing centre on £8m and £20m. and property transactions in a greenfield site at Broadleys The awards recognise Scotland. This helped lift annual Business Park. It is scheduled for everything from profit share to billings to nearly £20m in the completion in April of next year, highest climber as detailed by latest financial year. and is expected to create 18 jobs the Scottish Business Insider’s They reported profits of £7m, within the next four years. SME 300 database collated in the which meant staff received Acquired by McLaren in 2013, September 2017 magazine edition. the equivalent to 11 per cent Blue Box currently employs Now in their 11th year, the of their annual salary in their 30 people generating annual awards will be presented at a performance-related bonuses. revenues of £1.4m. Duncan prestigious award celebration The company said profits had Robertson, Blue Box’s managing dinner attended by representatives increased by 78 per cent in the director, said the new facility will from the SME300 companies. ■ four years since its merger with Scottish legal firm Macdonalds. D M Hall, which was 34th Now in their eleventh year, the in the rankings in September, reported a deal with what was awards will be presented at a More information about the believed to be the highest price prestigious award celebration event can be found at www. per square foot ever achieved for a sme300awards.co.uk. To book commercial property in Scotland. dinner attended by representatives tickets or discuss sponsorship The sale price at £998,718 opportunities please call Sharon represented a price of £3,781 from the SME300 companies Tonner on 0141 309 3054 or email per square foot for the 258 sq ft [email protected]

www.insider.co.uk December 2017 INSIDER 73 EVENTS: TOP500 BUSINESS BREAKFAST

TOP 500 BUSINESS BREAKFAST FRIDAY JANUARY 12 2018 SHERATON GRAND HOTEL EDINBURGH Top 500 keynote speaker named

raeme Roy, director McGregor started working in QTS has seen exponential of the Fraser of Allander the Bank of Scotland when she was growth over the last six years Institute at the University 15 to help her mother support the and is now one of the top twenty Gof Strathclyde, is to be the family after her father died. From maintenance suppliers to Network keynote speaker at the Insider Top there she went on to study for a Rail. 500 Business Breakfast early in the banking degree and landed a job Further members of the panel Ne w Year. with Barclays. will be announced in due course. Roy is uniquely placed to After more than 20 years with As the Brexit negotiations give an overview of the Scottish Barclays McGregor moved to Above: progress – or don’t – what will economy and its prospects in 2018 Clydesdale Bank, where she Graeme Roy be the shape of the new trading as head of an institute which has worked as regional and then relationships between the UK made a unique contribution to national director of corporate, and European Union member our understanding of the Scottish structured and acquisition finance. countries? economy over many years. Keith Anderson has been chief How will the effects of artificial Roy rejoined the institute as corporate officer of the Iberdrola- intelligence, new developments in its head in 2016 from his roles in owned utility since July 2011 and robotics, the internet of things and Scottish Government as senior is chief executive of Scottish Power 3D printing change the way our economic advisor and head of the Renewables. His responsibilities businesses can and should operate? First Minister’s Policy Unit. include all of Iberdrola’s offshore The Top 500 Business Breakfast The event provides business businesses. He previously worked takes place at the Sheraton Grand leaders with key insights into what with major financial institutions Hotel and Spa on Friday 12 they might expect to see in the including The Royal Bank of January. At the event Insider’s Scottish, UK and global economies Scotland and Standard Life. Top 500 index will be unveiled during the year ahead. Phyllis McLeish has more – the most authoritative listing Graeme Roy will be joined by a than 25 years business and of Scotland’s biggest and most panel of business leaders to discuss finance experience specialising in successful companies. from their own vantage points the construction and rail, the last eight The audience will have the trends in the economy and the of which were at QTS Group. opportunity to question the continuing effects of the Brexit keynote speaker and panel vote and growing impacts of new members to tease out what the technology across most business The audience will have the wider economic trends mean for sectors. opportunity to question the keynote their sector and business. ■ Panel members include Alison For more information see www. McGregor, chief executive speaker and panel members to insiderbusinessbreakfasts.co.uk. of HSBC Scotland; Keith To book tickets or discuss Anderson, chief corporate officer tease out what the wider economic sponsorship opportunities please of ScottishPower; and Phyllis contact Caroline Miller on McLeish, commercial director of trends mean [email protected] or call QTS Group. 0141 309 3133.

74 INSIDER December 2017 www.insider.co.uk Tuesday 6th @InsiderMag #InsiderBB March 2018 Mercure Ardoe House Hotel, Aberdeen

TICKET PRICES Tickets: £49.50 plus VAT Table of 10: £450 plus VAT Table of 12: £540 plus VAT

sponsored by www.insiderbusinessbreakfasts.co.uk To discuss sponsorship opportunities please contact Caroline Miller on: 0141 309 3133 or [email protected] WEALTH MANAGEMENT: FRANCIS SHENNAN

CAN WE re-adapt to the economic version of back to the future?

ow much is $3.5 trillion? It is roughly position our portfolios. equal to spending $20 a second, every Sym has been buying financials, telecoms and second of every day, every day of every other stocks he thinks will benefit from that. And he’s Hmonth, since the year 3,500 BC until now. not alone. And the BC refers to ‘before Christ’ not to before the Over at Hermes, Lewis Grant, senior portfolio credit crunch. manager, Global Equities, is looking to retail-focused According to Marcus Brookes, head of the multi banks with strong deposit bases, noting that banks, manager team at Schroders, it is equal to the amount insurers, brokerages and asset managers tend to of new money which the Federal Reserve created to perform well as interest rates rise. buy financial assets, principally government bonds, “Banks, for instance, benefit from greater spreads as part of quantitative easing (QE). Now it has embarked on a policy of quantitative tightening, taking around $10bn a month out of The European Central Bank the economy for two or three months, then $20bn, then $30bn, then $40bn, then $50bn. It is reversing a announced it is to continue policy that pushed asset prices up and interest rates down. with quantitative easing until The European Central Bank announced it is to continue with quantitative easing until next next September but its asset September but its asset purchases will be halved from 60bn to 30bn euros per month. It forecasts inflation purchases will be halved will fall to 1.2 per cent next year, rising to 1.5 the year after. on deposit accounts, while brokerages and fund QE is likely to run until December next year after managers typically attract more business as rising which interest rates will probably rise around mid- rates signal a strengthening economy and therefore 2019. “The tightening of European monetary policy greater investment activity.” will continue to be a very gradual process, with The likely losers will be the “seemingly safe no plans for a cliff-edge end to the bond purchase dividend-payers” which have become “incredibly programme,” says Paul Rayner, head of government overvalued in the low-rate environment”. He is bonds at Royal London Asset Management. avoiding investments whose values rely solely on a One view of this is that Britain, the US and Europe steady dividend stream. appear headed in the same overall direction of rising Central banks are planning for steady rises in interest rates and rising inflation but at markedly interest rates, though they will not have the same different speeds. Brookes’s colleague, James Sym, control over inflation rates. Steady or not, it is Schroders’ fund manager, European Equities, adds: what Hermes describes as “an era-defining shift in “Our strong view is that over time inflation is coming monetary policy”. back, and it’s coming back big time.” Some of us are old enough to remember when It would mark the gradual return to an economic QE referred to a Cunard liner rather than monetary environment that used to be the norm. That would policy. Are we young enough to be able re-adapt to mean remembering or relearning how we used to the economic version of back to the future? ■

IN FOCUS: M&S M&S Bank set to launch first mortgage This is not just a mortgage, it is an M&S years later by a fee-free account, which has had branches and more than 120 bureaux de mortgage. That could be the TV ad early next average annual growth of almost 60 per cent change in M&S stores, M&S Bank operates as year when top of form M&S Bank launches over the last two years. a joint venture between HSBC and Marks & its first mortgage after five years as a current M&S Bank, the trading name of Marks & Spencer but has its own banking licence and its account provider. Available to both first-time Spencer Financial Services plc, launched on the own board. buyers and home-movers, directly through the foundations of M&S Money, established in 1985. “M&S current accounts have proven incredibly bank and through brokers, it is the final step to In 2004, HSBC bought 100 per cent of the share popular with customers who want a transparent being a full-service bank. capital of Marks and Spencer Retail Financial bank account with no overdraft charges,” said Its first current account in 2012 offered retail Services Holdings Ltd. chief executive Sue Fox. “Many of our customers rewards but a monthly fee. It was followed two With almost four million customers, 29 have shopped with M&S their whole lives.” ■

76 INSIDER December 2017 www.insider.co.uk WEALTH MANAGEMENT: INTERVIEW Q&A KEITH THOMSON, Thomson Wealth Management

QQ: Before the current government came to power, there was a pledge to increase the inheritance tax (IHT) allowance to £1m. Whatever happened to that? New rules implemented this year mean we are a step closer to achieving this – for married couples at least. From April this year, each individual can claim an additional Main Residence Allowance of £100,000 to offset against a family home on death. This is in addition to the £325,000 nil rate band inheritance tax exemption. This new tax allowance will rise each year to £175,000 by 2020. On the second death of a married couple this permits 2 x £175,000 and 2 x £325,000 to be offset against assets – therefore reaching the magic million. There are caveats and catches, so it is important to review your circumstances to ensure you receive all the allowances. Currently, spouses and civil partners can pass all their wealth to each other without tax. However, tax may be payable when passing wealth down to the next generation. Everyone is entitled to pass assets tax-free up to the nil-rate band of £325,000. This nil-rate band can also be passed between spouses creating a £650,000 joint allowance. Asset values above this are taxed at 40 per cent.

QQ: How does the new the main residence nil-rate band work? From April this year the new band permits the IHT due on the sale of a family home to nephews, brothers or sisters. It will also not be businesses can be passed down the family be reduced further. It begins at £100,000 available when property has been left in trust, free from IHT because they qualify for Business per individual, rising to £125,000 next year, which is why wills should be revisited urgently. Property Relief. However, even when this is £150,000 in 2019 and £175,000 in 2020. Like the And to claim it, you must leave a property the case, its value will be included in the value basic nil-rate band, it is transferable between in your estate and have lived in it as your main of estates for main residence nil-rate band spouses, which permits them potentially to residence at some point. So property that has purposes. This will frequently push them above pass on to £1m without tax. always been a buy-to-let will not qualify. the £2m limit. However, if the property is worth less than It is possible to protect the allowance if you The new band allows an important £350,000, the balance of the allowance cannot sell your family home to downsize, move into and valuable asset to be passed to future be offset against other assets. So if there are rented accommodation or a nursing home. beneficiaries. With careful financial planning, it ways of increasing the value of the main If you have sold a property after July 8, 2015, is also possible to pass significant other assets residence, these should be explored. But the you should calculate what percentage of the on to the next generation without taxation. main residence nil-rate band is available only main residence nil-rate band could have been Pension freedoms and trust planning all for estates valued at less than £2m. claimed, as long as the death was after April contribute, and a review of circumstances is this year. essential. ■ QQ: Who can inherit? The new allowance is available only when QQ: Why can business owners potentially the main residence is inherited by direct miss out? Keith Thomson is a director and independent descendants: children, stepchildren, adopted Business owners are particularly vulnerable financial adviser at Thomson Wealth children or grandchildren – not nieces, to losing main residence nil-rate band. Most Management. www.insider.co.uk December 2017 INSIDER 77 INSIDER: APPOINTMENTS

People on the move in Scotland’s business community

new posts

Mid-tier accountant Top names strengthen SCDI board Johnston Carmichael has appointed corporate people and technology”. finance partner Mark Joining the SCDI board are Jim Stewart as managing McColl, founder, chairman and partner of the Edinburgh chief executive of Clyde Blowers; office. Karen Betts, chief executive of the Scotch Whisky Association; Property agent Savills has Stephen Boyle, chief economist strengthened its Scottish at Royal Bank of Scotland; retail agency team with Edel Harris, chief executive of the appointment of Isla Cornerstone; Ray Riddoch, Monteith as a director in managing director of Nexen the Edinburgh office. She Petroleum UK; Lord Andrew joins Savills from Cushman Dunlop, former Scotland Office & Wakefield. Minister; and Malcolm Roughead, chief executive of VisitScotland. Oil and gas pipe care Mark Bevan, chief executive of specialist Ramco Group SCDI, said: “SCDI has a unique has appointed former Malcolm Roughead Jim McColl role to play as Scotland’s Economic Dominion Gas managing and Social Forum and there is an director Russel Davies as Economic lobby group the SCDI, which “seeks to influence urgent need to act. its new chief executive. Scottish Council for Development and inspire Government and key “Thismeans drawing from He takes over from Derek and Industry (SCDI) has stakeholders” to deliver sustainable our near 90-year heritage and Smith, who is stepping significantly strengthened its board economic growth for Scotland, has setting a level of future ambition down after three years to as it looks to create “a practical recently added seven new board commensurate with Scotland’s relocate back to the blueprint for Scotland’s economic members to “reflect its members’ leading lights across the private, Central Belt. f u t u r e”. ambition and an investment in public and not-for-profit sectors.” Catering and events New heads and a raft of promotions at KPMG specialist Sodexo Sports Three added at & Leisure has promoted David Toner to a Investing Women newly-created position of divisional director for Scotland’s only all-female Scotland. business angel group Investing Women added two new board Wealth manager Brown appointments and a board advisor. Joining the group’s board are Shipley has appointed restaurant entrepreneur Sanja Moll Alan Mathewson as and former investment banker its new chief executive. Evelyn Simpson, both of whom are He joins the firm from active investors within the investor Santander UK where he group. was its managing director Tax specialist Kirsty Paton from of Wealth Management accountants Chiene + Tait has also and Private Banking. been appointed as a board advisor. Edinburgh-based Moll co- Andrew Sutherland, founded restaurant chain Salt Yard Big four accountant KPMG Sanderson and now leads a team of Group in 2005 launching three joint managing director of has appointed new heads of tax, more than 100 staff. of its award-winning London Edinburgh-based Miller audit and consulting for its Scottish Subesinghe, who joined in 1993, Developments, has been restaurants - Salt Yard, Dehesa practice alongside a raft of senior has been promoted to head of appointed as the new chair and Opera Tavern - specialising in promotions. consulting in Scotland overseeing of the Scottish Property Spanish and Italian food. Alan Turner has been promoted a range services including financial Federation (SPF). She opened a neighbourhood rotisserie, LeCoq, in Islington with to head of tax in Scotland, Hugh management, IT advisory, and her sister in 2014 having sold her Harvie to head of audit and Sam family business consulting. Dr Claudia Cavalluzzo has stake in Salt Yard Group to a private Subesinghe to head of consulting. KPMG has also added three been appointed as deputy equity group. Moll remains on the Turner joined KPMG in 2005 new partner promotions and five director of Converge Salt Yard Group board as a non- Challenge and enterprise and previously led KPMG’s UK Tax director promotions. Joining the executive director. Centre of Excellence in New York. partnership (pictured above L-R) outreach manager at Simpson spent 12 years with JP Heriot-Watt University. Harvie took over as head of the are John Waterson (audit) and Morgan Chase. audit practice earlier this year David O’Hara and Sandra Gilchrist following the retirement of Alex (tax). ■ 78 INSIDER December 2017 www.insider.co.uk INSIDER:PERSONNEL COMMENT

The latest news from HR, recruitment, Stephanie Harper employment law and staff issues Head of HR Projects, Navigator Employment Law T: 03332 400 308 E: stephanie.harper@ navigatorlaw.co.uk W: www.navigatorlaw.co.uk GDPR Preparation - Part 2 Data Breaches This November saw the Assistant Chief Constable of West Midlands Police suspended and facing criminal liabilities charges. He left sensitive papers in his car which, together with other items, were subsequently stolen. The possibility of action for data breach against an individual is unusual but in this instance, was a potential risk to national security. Nevertheless, this situation may sound familiar and highlights the need for improving working practices to avoid companies facing fines under the General Data Protection Regulations (GDPR) of up to €20 million or four per cent of annual turnover Ruling on staff digital interaction (whichever is the higher) and/or enforcement notices. recent European Court case workplace communications must be justified. In Quarter 1 the Information Commissioners Office finally provided some clarity on In notes reversing the earlier decision, the (ICO) reported a 20 per cent increase of paperwork employers rights on monitoring ECHR found Mr Bărbulescu’s rights had been data breaches, 46 per cent of email related breaches A staff’s digital interactions and an breached under Article 8 of the Convention. but interestingly a decrease of 17 per cent of cyber employee’s right to privacy. It adds an employer can still dismiss attack breaches. In summary, human error is the The ruling from the European Court an employee for private use, though biggest reason for data breaches. of Human Rights (ECHR) brought to an any measures to monitor and safeguard As part of the GDPR roadmap, Subject Access end a 10-year appeal process brought by communications must be “accompanied by Requests were covered last month. The next key area a Romanian engineer dismissed by his adequate and sufficient safeguards against is how companies handle data breaches. From 25 employer for accessing personal messages a b u s e”. May 2018 companies will have 72 hours to notify the during worktime via a work-related instant Julie Keir, a professional support lawyer ICO when there has been a data breach. Depending messenger service. in the employment team at Brodies LLP, on the data breach and level of risk, data subjects The applicant, Bogdan Mihai Bărbulescu, said while the recent ECHR ruling led to including customers and other regulators, may need argued his termination was a breach of suggestions employers will now find it more to be notified too. rights to respect for his private life and difficult to monitor employees’ email, she Companies should be in the process of correspondence as enshrined in Article 8 of argues those rights were already limited by establishing a trained incident response team to the Convention. existing UK legislation. respond quickly to data breaches. Likely members of His employer argued using the messenger She said: “On the face of it the ECHR the team might include: the Data Protection Officer service for personal use was strictly decision appears to restrict the ability of (DPO); Data Controller(s); Data Processor(s), PR and prohibited under its terms of use policy. employers to monitor workplace emails and IT. Putting into place an incident response procedure The Romanian courts ruled the employer’s internet use. and a template data breach log will help with actions were lawful and in January the ECHR “However, the practical implications of compliance. Employees should also be clear about was asked to judge on whether Romania’s the decision in the UK are limited by the fact their responsibilities and who to notify. laws and legal system had failed to protect that this area is already heavily regulated by On establishing there has been a personal data his individuals’ rights under Article 8 of the legislation including the Data Protection Act breach this team should take any remedial action European Convention, and sided with the 1998 and the Regulation of Investigatory to minimise the impact of the breach. For instance, Romanian courts. Powers Act 2000. IT may be able to wipe data from a laptop left on The applicant then requested a referral to “Together with the Employment Practices a train remotely. The data controller(s) and data the grand chamber and in September the Code, published by the Information processor(s) will be required to cooperate with the ECHR reversed its earlier ruling, stating Commissioner’s Office, these place important ICO and the DPO must be available. Companies will some of his communications, which were limitations on an employer’s ability to be expected to put into place any recommended intimate in nature, had not been “adequately monitor communications at work.” improvements to working practices and hopefully protected”. Mel Sangster, director in the employment avoid any fines. In its final ruling, the ECHR said it was law team at Burness Paull, said the grand To find out about GDPR training in January 2018 also not clear whether the applicant had been chamber ruling does finally provide guidance and how Navigator may help you with avoiding warned his communications were being on when it is, and when it is not, acceptable to personal data breaches please contact 03332 400 308 or [email protected] monitored, and while the company had a monitor an employee’s digital interactions. policy prohibiting the personal use of IT She said: “For employers in the UK, and equipment, it hadn’t made clear the content of despite some of the sensational headlines communications would be monitored. surrounding this case, the position remains The court noted an employer cannot that it is essential to have thorough and clear simply give itself absolute power to invade IT policies, which leave employees in no employees’ privacy, and stressed monitoring doubt as to what is permitted or prohibited.” ■ www.insider.co.uk December 2017 INSIDER 79 Insider’s regular events picture pages In association with

HIGHLAND SINGLE MALT SCOTCH WHISKY

Above Left: The IoD Scotland Conference took place at the Gleneagles Hotel in November. Pictured are Philip (director of the V&A in Dundee) and Annie Long. Above: Alexander Sloan, the independent financial advisor held a reception at Glasgow City Chambers to mark 150 years of the firm. Former managing partner Bill Mann CBE is pictured with the apprentice for 2018, Megan Forsyth. Bill was the firm’s apprentice in 1952. Left: Pictured at the Scottish Golf Tourism Awards, Trump Turnberry resort, for part of Scottish Golf Tourism Week are, L-R: Jason Scarth, Britannia Golf; Carmen Rowe, Ardgowan Hotel; Graham Spears, Sterling Golf Tours; and Rachel McLachlan, Playfair’s Restaurant and Steakhouse at Ardgowan Hotel.

WORTH THE WAIT

80 INSIDER December 2017 www.insider.co.uk Above: An event for the Highland Golf Links 54-hole Pro-Am at Kingsmills Hotel, Inverness during October, raised £2,250 for two charities, Highland Hospice and The Oxygen Works. Pictured, L-R, are the joint pro winners Neil Fenwick, Jonathan Grogan, Austin Carey (director of sponsors Blue Group), Fraser Cromarty (event organiser), Neil Henderson and Gareth Wright. Right: BIG Partnership staged an Equality in Tech event at its Edinburgh office. Pictured here are Gregor Cunningham (Exception) and Lucia Funai (BIG Partnership). Below: The Edinburgh-headquartered Association for Project Safety’s 10th annual National CDM Awards took place in London in October. Pictured here are some of the dinner guests that descended on the photo booth.

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www.insider.co.uk December 2017 INSIDER 81 THE TEN minute interview Michelle Lownie Michelle Lownie is one of Eden Scott’s co-founders. Her career in recruitment began at Melville Craig where she worked for 15 years. Following a takeover she joined fellow directors Chris Logue and Guy Martin in establishing their own agency, Eden Scott, in 2003. Driven by their passion for a more customer-focused, personal approach to recruitment, Michelle and her fellow directors have built a business that turns over £15m a year and is one of Scotland’s leading recruitment firms.

What five words would friends/colleagues use to describe you? Honest, blunt, determined, optimistic and challenging see our young people let down time and again by the – these are the ones that can be printed anyway. system and life in general. The Children’s Hearing System is unique to Scotland and does a fantastic job If you could choose anyone, who would be your of keeping our young children safe but we really need fantasy board members and why? to start tackling the root causes and help our young Steve Jurveston (Silicon Valley investor) for his energy people realise that there are options and alternatives and enthusiasm – “why aim for the moon when we’ve out there. Scotland is an amazing country with a been there already”. I met him at EIE17 this year and wealth of very talented people with great thought he was fascinating – such a character. entrepreneurial spirit and amazing ideas and I think Margaret Thatcher, likely a controversial choice for we need to do more to embrace, enhance and many but even if you don’t agree with the politics I encourage that. think it is important to recognise her achievements Above top: Elie and what she did for female leaders. What was the last film/concert/entertainment event There are still only around 22 women prime ministers/ Above: Eric Morcambe you attended? presidents – globally. would be on Michelle’s The last film I saw was T2 Trainspotting, normally I fall Sir Alex Ferguson – although day-to-day recruitment is fantasy dinner party guest asleep at the cinema but managed to see this through list relatively far removed from the football pitch I think he to the end, it was brilliant to see Edinburgh in all its has leadership qualities we can all learn from – Below: she admires glory. Last concert was Party in the Palace – Kaiser spotting and developing talent, managing successful Sir Alex Ferguson’s Chiefs as the headliner. teams, knowing when to let people go and leadership qualities overarching everything is his desire to be the best and What is your earliest childhood memory? win. My mum’s white poodle called Snowy, a little ball of fluff chasing me up the street on my orange space If you could choose anyone, who would be your hopper. fantasy dinner party guests and why? Elvis so he could sing to me, Eric Morecambe to make Describe a perfect day/night/weekend. me laugh, Bradley Cooper as he is easy on the eye, We have a holiday home in Elie so it’s great to go over Stephen Fry for some highbrow chat and of course there for the weekend. Smoked prawns, chilled wine Martin Wishart so we can all have something edible. – kids in bed – shattered from the sea air dreaming of another hard day dune jumping and sand castle What advice would you give to the next generation construction. of business leaders? Believe in yourself, think big. Take advice when you What is your most embarrassing moment? can, you may not always like what you hear, it is I did once turn up at a RBS Event in St Andrew Square important to get the basics right in terms of legal and where I was given a glass of champagne, it was finances and of course picking the right team is supposed to be a Women In Business event hosted by essential – that’s why Eden Scott and TalentSpark exist. RBS but there were very few females around; after Learn from mistakes, move on and don’t dwell, do about half an hour of chatting with various people I everything with passion and full commitment discovered that Sir Fred Goodwin (before he was otherwise there is no point. relegated back to just plain old Fred) was hosting the event to thank his senior management team for their If you were in charge of Scotland, what would you half year results. I was actually supposed to be across change and why? the square in the other building. I made a swift exit – I volunteer for the Children Hearing System and sadly just after finishing my champers. ■ 82 INSIDER December 2017 www.insider.co.uk QUICK BUSINESS STORIES TO START YOUR DAY

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