What are UK growth markets and why do they matter?

UK growth markets, including AIM and Aquis, are a significant component of the UK’s equity markets.

They support the vibrant, diverse range of companies being nurtured up and down the UK, enabling them to raise funds, promote their businesses and engage with larger more established companies. Most new admissions onto UK Growth Markets (83% on AIM since 2015 and 76% on Aquis since 2020) are UK incorporated companies. These Markets provide a home for companies across the UK’s regions and nations, who in turn support government’s plans for national growth. Not only do they serve growth companies, but also a range of companies that benefit from being on public markets. The market enables individuals and pension funds to put their savings to work in some of the most innovative companies in the UK, as well as offering the opportunity for individuals to support the pioneering and entrepreneurial work of UK companies. The regulated nature of these markets provides a level of protection that private markets do not. The businesses the markets facilitate play a vital role in balancing regional disparities by providing anchor institutions for local economies and drawing additional revenues into the UK from overseas through exports.

The market enables individuals and pension funds to put their savings to work in some of the most innovative companies in the UK, as well as offering the opportunity for individuals to support the pioneering and entrepreneurial work of UK companies. The regulated nature of these markets provides a level of protection that private markets do not. The businesses the markets facilitate play a vital role in balancing regional disparities by providing anchor institutions for local economies and drawing additional revenue into the UK from overseas through exports.

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Most new admissions onto UK growth markets are UK incorporated companies.

In 2023 AIM companies contributed £35.7bn gross value added to UK GDP and directly supported more than 410,000 jobs.

Approximately 25% of shares held on AIM are held by retail investors compared to 10% on Main Market

These companies made a corporation tax contribution of £5.4bn to the Exchequer.

AIM companies are, on average, more productive than the national average with productivity of £87,100 GVA per employee (12)

Number of companies admitted to AIM vs NASDAQ First North in 2023

Number of companies admitted to AIM

Number of companies admitted to NASDAQ First North

753

531

By providing access to finance, UK growth markets enable new and existing companies to make the investment needed to turn ideas into products, services and jobs. Mid-sized companies are often drawn to growth markets not only as a platform to raise capital, but also because of the increased visibility and credibility that comes from going public under a regulatory regime tailored to their needs. The capital generated by the markets is used by companies to execute their strategies, invest and drive growth within their locales. For example, Watkin Jones, based in Bangor, Wales, develops residential properties for students and young professionals. Verici Dx plc, a Penarth based company, develops advanced clinical diagnostics for organ transplant disease. Shepherd Neame, based in Faversham, Kent, is Britain’s oldest brewer.

Case study

Diaceutics, based in Dundalk, Northern Ireland is a diagnostic and data company providing services to many of the largest global pharmaceutical companies.

Since going public the Diaceutic’s market capitalisation has almost doubled. Being admitted to the market has also helped their visibility supporting them to secure contracts across international markets.

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Since going public the Diaceutic’s market capitalisation has almost doubled

Diaceutics was founded out of a desire to get more patients access to improved healthcare. Our IPO helped us in our mission to continue this great work

Peter Keeling, Chief Executive Officer

Companies like these create jobs in their local communities, advance R&D, attract investment into regional hubs, build and preserve infrastructure and support local universities. Businesses admitted to UK growth markets can have significant positive impacts on regional economies across the UK through job creation, supply chain relationships, and attracting investment to their local areas. They also give individuals opportunities to invest in assets that can deliver returns to support their financial resilience and save for their retirement aspirations and needs.

Case study

KR1 PLC, based in Douglas, Isle of Man is an investment vehicle which makes investments in new technology opportunities, particularly in blockchain-based digital assets.

KR1 were seeking capital in order to make strategic investments in digital assets in 2018. Due to the lack of understanding around these types of investment then, the company was finding it difficult to raise money through private investment.

By creating a public company and complying to the rules of an exchange, particularly in a country as financially sophisticated as the UK, KR1 was able to reassure investors of its credibility, thus giving them the confidence to invest.

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12 Grant Thornton, ‘The Economic impact of AIM companies’, (September 2024), available at: https://www.grantthornton.co.uk/insights/report-the-economic-impact-of-aim-companies/