2014 techtrack 100 research report

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T H E P R O D U C T I O N L I N E R E Q U I R E S A L O N G T E R M P E R S P E C T I V E

2 3 C O N TA C T D E TA I L S


0 1 I N T R O D U C T I O N

TechTrack ranks private technology companies based on their growth in sales over the last three years of available data.

I am pleased to say that it has been another impressive year for UK technology companies. The average sales growth for the 100 companies was 79% a year over their last three years of accounts, to a total of £2.1bn. They employ almost 14,000 staff, having added more than 10,000 jobs over the same three-year period, some as a result of acquisitions.

This report looks at some of the most interesting trends and themes that have emerged from this year’s research, as well as listing the full 2014 TechTrack 100 league table.

I hope you find both inspiration and insight in the following pages.

Stephen Welton Chief Executive

The Sunday Times TechTrack 100, identifies the UK’s private technology, telecoms and digital media companies.


0 2 I N T R O D U C T I O N

T O P 1 0 T E C H T R A C K 1 0 0 C O M PA N I E S

Rank 2014

Rank 2013 Company Activity HQ location

Financial year end

Sales growth % pa‡

Sales 2013/14£000

Sales 2010/11£000

In profit 2013/14

Staff 2013/14 Founded

1 15LMAX Exchange e-FX trading technology

West London Dec 13 307.80 *18,379 271 No 98 2008

2 2Switch Concepts Advertising software developer

Southampton Apr 14 262.92 †30,669 642 Yes 120 2008

3SwiftKey Smartphone keyboard developer

Central London Dec 13 219.04 9,884 304 No 119 2008

4Cloud Distribution Security & networking provider

Berkshire Dec 13 181.00 9,632 434 Yes 16 2009

5 18Tech21 Device impact protection maker

Southwest London May 14 171.73 †22,500 1,121 Yes 44 2005

6 5MobileWebAdz Mobile advertising provider

Central London Mar 14 142.01 †31,009 2,188 Yes 81 2002

7CloudSense Cloud computer software provider

Central London Jan 14 138.97 *7,717 565 No 121 2009

8Fidelity Group Telecoms services provider

Oxfordshire Dec 13 134.15 †5,670 442 Yes 12 2008

9Hide My Ass! Online security provider

Central London Mar 14 132.48 †10,718 853 Yes 78 2005

10Cobalt Light Systems Optical instrument manufacturer

Oxfordshire Jun 14 124.99 †11,641 1,022 Yes 37 2008

‡ compound annual growth rate between 2010/11 and 2013/14 * annualised figure † draft, audit exempt or not filed at Companies House

David Mercer, CEO of LMAX Exchange (No1),

spun the FX platform out of Betfair in 2012.

#1


0 3 E X E C U T I V E S U M M A R Y

O V E R V I E W

n The Tech Track 100 companies increased their sales by an average of 79% a year over three years (compared to 92% on last year’s table), from a total of £450m to £2.1bn

n Over three quarters (78) of the companies made an operating profit (OP) in their latest year (2013/14), with an average profit margin of 12%. 11 had margins of more than 20%

n 65 of the companies on the league table are majority-owned by an entrepreneur and/or founders; while 23 are majority-owned by private equity or venture capital firms and 3 by business angels – who back a total of 41 companies

n Software companies dominate the league table with 20 companies developing software for anything from tracking vehicles, (Masternaut, no 62) to monitoring health and safety (CR360, no 71) and booking meeting rooms for organisations with multiple offices (Condeco, no 84)

n The majority of companies on the league table are based in London (53) and the southeast (17)

K E Y T H E M E S

Growth capital fundraising: In the year to August, 18 companies received venture capital or private equity funding from either new or exisiting backers. This is a significant increase on the 9 in 2013 and 11 in 2012 [page 8]

Women in tech: 10 of the companies are run, or majority owned, by women [page 9]

High-tech manufacturing: The league table is home to 9 high-tech manufacturers [page 10]

International expansion: Over half of the league table earn at least some of their revenue overseas, and many are establishing international offices to capitalise on this [page 11]

Fintech: Technology has increased the number of financial transactions consumers are conducting online and on the move and 7 companies are active in this area [page 12]

Mobile: 15 companies are solely, or partially, focused on developing content for mobile platforms [page 13]

Exploiting social media: as social media becomes more prevalent, five companies are exploiting it for marketing and content generation purposes [page 14]

Adtech: 13 companies deliver increasingly personalised adverts to web browsers and mobile devices [page 15]

Emerging brands: The league table contains a number of companies that are aiming to make themselves household names [page 16]

Growth in sales

Number of companies in each range of compound annual growth rate (CAGR) of sales over latest three years.

Characteristics of an averageTech Track 100 company

SalesAverage growth over three years 79% paSales in 2010/11 £2.1mSales in 2013/14 £20.9m

Profits Operating profit in 2013/14 £0.9mNumber of profitable companies 77Margin (profitable companies only) 12%

StaffTypical number of staff 139 in 2013/14Typical increase in staff 106 over three years

Company characteristics Region Greater London (53)Sector Software (20)Founded 2007Majority ownership Entrepreneur and/or founder (65)Angel or VC investment 41

>200%

175%–200%

150%–175%

125%–150%

100%–125%

85%–100%

70%–85%

55%–70%

40%–55%

3

1

1

4

11

11

12

22

35


0 4 K E Y S TAT I S T I C S

Sales breakdown

Number of companies in each range.

Companies with the biggest sales

Rank Company Activity

2013/14 sales £m

90IESA Supply chain manager

143.3

50Reward Gateway Employee benefits provider

127.8

24musicMagpie.co.uk Online entertainment trader

84.1

11MedicAnimal Online pet products retailer

71.4

62Masternaut Vehicle tracking software developer

69.7

S A L E S B R E A K D O W N

n The top ranked company, foreign exchange platform LMAX Exchange, saw average sales growth of 308% a year, from £271k in 2010 to an annualised £18.4m in 2013. The 100th ranked company, security software developer Avecto, achieved average sales growth of 41% a year, from £3.0m in 2011 to £8.4m in 2014

n Supply chain manager IESA (No 90) reported the highest sales on the table at £143m. Mobile app developer The App Business (No 29) had the lowest sales at £5m

n Nine companies reported sales in excess of £50m. They include vehicle tracking software developer Masternaut (No 62), online entertainment trader musicMagpie.co.uk (No 24) and online pet products retailer MedicAnimal (No 11)

S TA F F & J O B C R E AT I O N

n Companies employed a combined total of 13,961 staff in 2013/14, which gives average revenues per employee of £149,768

n Over 10,000 jobs have been added over the past three years. However, as a result of acquisitions, not all of these are new jobs. For example, information management company EDM Group (No 57) merged with Sala International in 2011 and made several further acquisitions, which helped it grow from 304 staff in 2011 to 1,135 in 2014.

n The biggest employers on the league table were EDM Group (No 57); musicMagpie.co.uk (No 24), with 1,074 staff; and Mobica (No 91), with 530 staff

n 19 companies employed fewer than 30 staff, including cloud service provider essensys (No 63), with 24 staff, and tourism smartcard developer Leisure Pass Group (No 92) with 15 staff

F O U N D AT I O N D AT E

Tech Track 100 companies are typically young and dynamic, with 92 founded after the turn of the century, with 12 founded in the last five years. Two companies – Potato (No 25), a digital marketing agency, and IT services provider Pulsant (No 35) were founded in 2010. Sales at these two companies grew to £5.7m and £43.7m respectively.

Number of employees

Number of companies in each employee range

>100

51–100

30–50

<30

12

44

35

17

279

>£100m

£51m–£100m

£21m–£50m

£10m-£20m

<£10m

2

7

19

25

47



P R O F I TA B I L I T Y

Tech Track 100 companies are not required to be in profit. However, 78 companies on this year’s league table reported an operating profit in their latest available accounts, with 11 showing an OP margin of more than 20%. Combined profits of the 78 companies were £150m in 2013/14.

Fidelity Group (No 8) and TranslateMedia (No 88) did not disclose their operating profits.

Of the 20 companies reporting a loss, 18 are backed by venture capital firms or private equity firms, supporting them through an unprofitable period in the hope of building value for a future exit (see ‘Biggest losses’ below).

B I G G E S T P R O F I T S & O P E R AT I N G P R O F I T M A R G I N S

n Financial services comparison website money.co.uk (No 58) had the biggest profit margin on the league table, at 66%

n Online flight search engine SkyScanner (No 23) saw the biggest profits on the league table, at £17.7m

n The average margin among the 78 profitable companies was 12%

B I G G E S T L O S S E S

n Vehicle tracking software developer Masternaut (No 62) reported the biggest operating loss of £11m in 2013. The company received an undisclosed investment from Summit Partners and Fleetcor Technologies in June 2014.

n Datacentre provider Infinity SDC (No 22) reported a loss of £5.1m for 2014. In September 2013 it secured £48m of backing from investors including Lansdowne Partners to fund development of its new datacentre on the Olympic Park.

1 0 C O M PA N I E S W I T H B I G G E S T O P E R AT I N G P R O F I T S

Rank#

Company Activity

Latest sales £000

Latest OP £000

Profit margin

23Skyscanner Travel search engine

65,819 17,736 26.95%

59OneCom Telecoms services provider

43,775 11,998 27.41%

58money.co.uk Money comparison website

16,365 10,724 65.53%

92Leisure Pass Group Tourism smartcard developer

53,375 10,074 18.87%

18EV Remote video technology maker

19,570 6,327 32.33%

41Apical Imaging technology developer

12,772 5,305 41.53%

91Mobica Software engineering services

21,300 4,000 18.78%


143,300 3,750 2.62%

85Core Group Telecoms services provider

20,665 3,598 17.41%

27Equal Experts Software developer

23,792 3,227 13.56%

1 0 C O M PA N I E S W I T H B I G G E S T O P E R AT I N G P R O F I T M A R G I N S

Rank#

Company Activity

Latest sales £000

Latest OP £000

OP margin


16,365 10,724 65.53%

41Apical Imaging technology developer

12,772 5,305 41.53%

74HighQ Cloud collaboration software developer

5,527 2,158 39.05%


19,570 6,327 32.33%

55Next Generation Data Datacentre operator

8,023 2,558 31.89%

29The App Business Mobile app developer

5,112 1,497 29.29%


10,718 3,013 28.11%

25Potato Digital marketing agency

5,755 1,591 27.64%


43,775 11,998 27.41%

23Skyscanner Travel search engine

65,819 17,736 26.95%



O W N E R S H I P

n Almost two thirds (65) of the companies on the league table are majority owned by an entrepreneur and/or founders, such as online security provider Hide My Ass! (No 9), which was set up in 2005 by a teenage Jack Cator, who is now 25 and the company’s chief executive.

n Twenty three companies are majority-owned by private equity or venture capital firms.

n This includes Norwich-based oil and gas well downhole camera developer EV (No 18), that underwent a £69m MBO in June that saw Lime Rock Partners bought out by Dunedin, which now holds a 69% stake.

G R O W T H C A P I TA L I N V E S T O R S

n At least 70 venture capital or private equity firms hold stakes in 38 companies in the Tech Track 100. BGF (Business Growth Fund) has three investee companies in the full ranking: The Exchange Lab, Inoapps and Unruly Media, and another BGF investee company, M2 Lasers, is mentioned as One to Watch.

n Business angels own a minority stake in three companies, and venture capital firms also hold minority stakes in 15 companies.

n In total, 41 companies have secured external growth capital.

1

65

23

83

Major ownership

Number of companies by ownership type

Entrepreneur and/or founder 65 PE and/or VC 23 Management 8 Business Angels 3 Employees 1

#9CEO Jack Cator set up Hide My Ass! at the age of 16.



I N D U S T R Y B R E A K D O W N

Software companies are the largest sector on the league table (20 companies) generating £501m of sales and employing 4,453 staff in their latest year. These included management software developers such as CR360 (No 71), whose software is used by companies such as M&S to manage their sustainability reporting, and e-business software firms including eTech (No 36) whose software is used by surveying firms to generate valuation reports on properties.

Internet and network services companies account for 16 of the firms on the table. These include security and networking provider Cloud Distribution (No 4) and wireless network monitoring firm CRFS (No 45).

10 online consumer services firms feature. These companies range from online pet products retailer MedicAnimal (No 11) to consumer reviews firm Reevoo (No 86). Together the 10 companies generated sales of £413m and employed 2,230 staff.

Seven fintech companies feature on the league table including number one company LMAX Exchange, an electronic trading platform, and Prepaid Financial Services (No 16), which provides pre-paid cards and contactless payment methods.

Sector breakdown

Number of companies by sector

Software 20

Internet & network services 16

Advertising technology 13

Fintech 7

Other 9

High tech manufacturing 9

Telecoms 6

Online consumer services 10

Outsourced computer services 10



R E G I O N A L B R E A K D O W N

n The regional breakdown of this year’s Tech Track 100 companies is broadly similar to 2013. Greater London is home to the highest proportion of companies, with just over half (53) of this year’s table based there

n The next biggest region is the southeast, with 17 firms. This covers the areas surrounding the M4 corridor technology hub, and there are a number of companies located in Surrey, Berkshire, Hampshire and Oxfordshire. These include Bracknell-based Displaydata (No 70) which develops electronic labels, as well as IT services provider Pulsant (No 57) based in Reading, and Oxfordshire’s Fidelity Group (No 8), a telecoms provider

n Nine companies are headquartered in the northwest. They include Cheshire’s MusicMagpie.co.uk (No 24), an online trader of DVDs, CDs and clothes, and Liverpool’s Marine Specialised Technology (No 89), a developer of high-tech boats for the defence industry

Regional breakdown of HQ in UK

Greater London 53

South East 17

North West 9

Midlands 5

North East 4

East 4

Scotland 4

South West 2

Northern Ireland 2

4

94

5

2

4

172

53



S U S TA I N E D G R O W T H 53 of this year’s list have not appeared on any previous Tech Track 100 league table. Three of these companies were tipped as Tech Track ‘Ones to Watch’ in 2013:

n SwiftKey (No 3), whose smartphone app learns how we type on our phones to speed up predictive texting

n Crimtan (No 56), a digital advertising technology developer

n HighQ (No 74), a cloud collaboration software developer

24 companies make a second appearance this year, 13 appear for a third time in a row, and four make a fourth consecutive appearance. Skyscanner (No 23) and Academia (No 73) each appear for a fifth consecutive year.

Four companies reappear after a gap of four or more years:

n Mobica (No 91) last appeared in 2010 in its former guise as a mobile phone software developer. It now delivers software engineering services across a variety of industries

n Masternaut (No 62) last featured in Tech Track 100 in 2009, and has since expanded its range of vehicle tracking products

n Core Group (No 85) appears for the first time since 2009, having expanded from a provider of cheap international phone calls to one of the country’s largest SIM card distributors

n IESA (No 90), a supply chain manager, appears for the first time since 2006, following a £30m private equity investment from Gresham in 2012

1 4 Y E A R S O F T E C H T R A C K 1 0 0

Of the c800 companies which have featured over the last 14 years, 4% have floated, 31% have been bought, and only 9% have gone bust.

Since appearing on Tech Track 100 in 2013, medical diagnostics provider Oxford Immunotec, house-buying software developer ULS Group and online estate agent Zoopla have floated. In addition, 7digital has been acquired by UBC for £16.5m, Nanosight by Spectris for £15m and We Are Social was acquired by China’s Blue Focus for an initial $30m.

Past stars include ARM, who appeared on the very first Fast Track 100 league table in 1997 with sales of £17m and floated in 2012 with a market cap of £10bn. Other companies who have featured include FTSE250 company Cambridge Silicon Radio who appeared in 2003 before floating in 2004 and biotech firm Abcam which floated ion AIM in 2005 and has a market cap of £850m.

CompanyYears appearing on Tech Track 100

Academia 2014, 2013, 2012, 2011, 2010

Skyscanner 2014, 2013, 2012, 2011, 2010

Fluidata 2014, 2013, 2012, 2011

Masternaut 2014, 2009, 2008, 2007

Nomad Digital 2014, 2013, 2012, 2011

AlertMe 2014, 2013, 2012

Click Travel 2014, 2013, 2012

Equal Experts 2014, 2013, 2012

Invenio Business Solutions 2014, 2013, 2012

Keytree 2014, 2013, 2012

Maxymiser 2014, 2013, 2012

MedicAnimal 2014, 2013, 2012

Mobica 2014, 2010, 2009

MobileWebAdz 2014, 2013, 2012

musicMagpie.co.uk 2014, 2012, 2011

OneCom 2014, 2012, 2011

Reward Gateway 2014, 2012, 2011

Xexec 2014, 2013, 2012


1 0 K E Y T H E M E S & S E L E C T E D C O M PA N Y P R O F I L E S

#18

#17

#54

G R O W T H C A P I TA L F U N D R A I S I N G

Some 18 companies on the Tech Track 100 have received venture capital or private equity backing in the last 12 months. This is double the number last year, and up on the 11 in 2012. For example, in November 2013, e-commerce software developer Metapack (No 51) raised £20m from Index Ventures for an 18% stake. Data centre provider, Infinity SDC (No 22) raised £48m from a consortium of investors, including RIT Capital Partners and Lansdowne Partners for a 60% stake in the business.

W O M E N I N T E C H

10 of the companies on this year’s Tech Track 100 are majority owned, or run, by women, going someway to counter the stereotype of the all-male tech scene. Examples include GGMR (No 61) which managing director Sheena Gill co-founded with her husband George, and Switch Concepts (No 2), which Joanne Spector runs with her co-founders Tom Barnett and Julian Spector.

H I G H - T E C H M A N U FA C T U R I N G

Services dominate Britain’s economy but this year the Tech Track 100 is home to 9 high-tech manufacturers, including Liverpool’s Marine Specialised Technology (No 89), a developer of high-tech boats for the defence industry, and Tech 21 (No 5), which makes smart-phone and tablet protectors out of a specialist material.

EV has received £69m backing from Dunedin to develop its downhole camera technology.

Alicia Navarro’s Skimlinks allows bloggers and journalists to earn revenue from the products they write about.

Northern Ireland’s Camlin Group develops switch technologies that will help reduce energy consumption in power transmission.



#79

#3

I N T E R N AT I O N A L E X PA N S I O N

At least half of this year’s Tech Track 100 have generated some of their revenue overseas with others following UK based customers as they expand internationally, whether through ecommerce, such as MedicAnimal (No 11) or opening offices to be nearer clients, such as Vermilion (No 78).

F I N T E C H

Technology has increased the number of financial transactions consumers are conducting online and on the move. Seven Tech Track 100 companies operate in the financial technology space ranging from peer-to-peer lenders to software developers providing the platforms for financial transactions.

M O B I L E

Mobile technology is recognised as a fast growing area of business activity. This year 15 Tech Track 100 companies are developing content for mobile platforms, including app development and mobile-specific marketing. Examples include ustwo (No 93), which develops user interfaces for apps and websites, and Somo (No 19), which develops mobile advertising technology.

#23Skyscanner has opened offices in Beijing, Miami and Singapore.

Zopa says it is the country’s oldest peer-to-peer lending site.

SwiftKey’s technology uses artificial intelligence to learn how we type.



#86

#25

#68

E X P L O I T I N G S O C I A L M E D I A

Social media is playing a growing part in everyday life, and this is reflected across this year’s Tech Track 100. Five companies are monitoring the interest their products generate on social media and using it to drive their marketing strategies, while others, such as Unruly (No 14) are exploiting social media to make content go ‘viral’.

A D T E C H

13 Tech Track 100 companies are helping customers to target their marketing by delivering personalised adverts to users’ web-browsers and mobile devices. This includes companies developing software to enable real-time bidding for advertising space, such as Periscopix (No 96), and others like Switch Concepts (No 2), who are tracking people’s movements around the web to optimise the adverts they see.

E M E R G I N G B R A N D S

Many of the companies on the league table are investing heavily in their marketing strategies to make themselves (or their product) a household name. The aim is to gain customers quickly and make themselves stand out from the competition.

Reevoo publishes every single review it collects, whether good or bad.

Jason Cartwright and Luke Gutteridge run Potato, one of a number of companies delivering targeted advertising.

Nish and Sachin Kukadia are focused on building SecretSales.com into a strong British brand before expanding overseas.


1 3 L E A G U E TA B L E

2 0 1 4 T E C H T R A C K 1 0 0 L E A G U E TA B L ERank 2014


Financial year end

Sales growth% pa‡

Sales 2013/14£000

Sales 2010/11£000

In profit 2013/14


1 15LMAX Exchange e-FX trading technology

West London Dec 13 307.80 *18,379 271 No 98 2008

2 2Switch Concepts Advertising software developer

Southampton Apr 14 262.92 †30,669 642 Yes 120 2008

3SwiftKey Smartphone keyboard developer

Central London Dec 13 219.04 9,884 304 No 119 2008

4Cloud Distribution Security & networking provider

Berkshire Dec 13 181.00 9,632 434 Yes 16 2009

5 18Tech21 Device impact protection maker

Southwest London May 14 171.73 †22,500 1,121 Yes 44 2005

6 5MobileWebAdz Mobile advertising provider


7CloudSense Cloud computer software provider

Central London Jan 14 138.97 *7,717 565 No 121 2009

8Fidelity Group Telecoms services provider

Oxfordshire Dec 13 134.15 †5,670 442 Yes 12 2008



10Cobalt Light Systems Optical instrument manufacturer

Oxfordshire Jun 14 124.99 †11,641 1,022 Yes 37 2008

11 22MedicAnimal Online pet products retailer

Northwest London Dec 13 122.02 †71,361 6,520 No 231 2007

12Omnifone Digital music provider

Central London Apr 13 121.72 46,870 4,300 Yes 181 2003

13Deeper Blue Digital media & events firm

Central London Aug 13 118.11 5,188 500 Yes 8 2009

14Unruly Video advertising platform

Central London Mar 13 117.47 19,313 1,878 No 123 2006

15ECS IT consultancy

Glasgow Dec 13 116.68 †38,925 3,826 Yes 134 2009

16 23Prepaid Financial Services Payment services provider

Central London Dec 13 115.68 10,401 1,037 Yes 41 2007

17Skimlinks Marketing technology developer

Central London Jun 13 113.91 13,346 1,364 No 53 2007


Norwich Mar 14 109.00 †19,570 2,144 Yes 101 2000

19Somo Mobile marketing services provider

Central London Dec 13 108.22 †23,067 2,555 Yes 130 2009

20 24Invenio Business Solutions IT consultancy

Reading Mar 14 106.54 †10,938 1,241 Yes 403 2006

21The Exchange Lab Digital advertising provider


22 26Infinity SDC Datacentre services provider

Central London Mar 14 98.26 †21,670 2,781 No 65 2006

23 28Skyscanner Travel search engine

Edinburgh Dec 13 95.52 65,819 8,806 Yes 377 2001

24musicMagpie.co.uk Online entertainment trader

Cheshire May 13 95.15 84,160 11,324 Yes 1,074 2007

25Potato Digital marketing agency





Rank 2014


Financial year end

Sales growth% pa‡

Sales 2013/14£000

Sales 2010/11£000

In profit 2013/14


26 13AlertMe Smart home monitoring provider

Central London Dec 13 94.99 †18,653 2,516 No 77 2006

27 8Equal Experts Software developer


28 1MVF Digital marketing services

North London Mar 14 89.97 †18,147 2,647 Yes 156 2009

29The App Business Mobile app developer

Central London Apr 14 88.59 †5,112 762 Yes 53 2009

30Car Loan 4u Car finance specialist

Cheshire Feb 14 87.97 †11,453 1,724 Yes 220 2006

31 14Mansion House Consulting IT consultancy

Central London Jan 14 85.26 †19,407 3,052 Yes 41 2009

32Chargemaster Electric car charging equipment supplier

Luton Dec 13 83.87 5,455 878 Yes 41 2008

33Brandwatch Social media monitoring technology

Brighton Dec 13 81.86 8,804 1,464 No 127 2006

34 19R-Com Consulting IT consultancy

Greater Manchester Dec 13 81.57 †7,095 1,185 Yes 23 1997

35 57Pulsant IT services provider

Reading Dec 13 79.13 43,729 7,608 Yes 172 2010

36eTech Surveying software developer

Solihul Mar 14 76.93 †5,919 1,069 Yes 107 2005

37 33Virtual1 Network services provider


38Ntegra IT consultancy

Newbury May 14 73.92 †14,595 2,775 Yes 81 2003

39Evolve Telecom Telecoms services provider

Essex Sep 13 73.78 20,261 3,861 Yes 106 2003

40Silixa Sensor technology developer

Hertfordshire Dec 13 73.65 5,119 978 No 60 2007

41 39Apical Imaging technology developer


42Calastone Fund transaction network

Central London Sep 13 72.31 7,793 1,523 No 75 2007

43 67Simplify Digital Product comparison software developer

West London Jan 14 70.97 †15,882 3,178 Yes 76 2007

44 62BCSG IT consultancy

Central London Jul 13 69.59 13,676 2,804 Yes 86 2006

45CRFS Network monitoring tools developer

Cambridge Mar 14 69.27 †5,617 1,158 Yes 30 2007

46 12E-Leather Eco-friendly materials developer

Peterborough Apr 13 68.72 8,362 1,741 No 98 1995

47Edenhouse IT consultancy

Warwickshire Mar 14 68.16 15,561 3,272 Yes 121 2008

48 32Maxymiser Online customer experience optimisation


49 91Olive Business Solutions Telecoms services provider

High Wycombe Jan 14 65.75 †19,648 4,315 Yes 160 2003

50Reward Gateway Employee benefits provider

Central London Jun 13 64.77 127,813 28,574 Yes 135 2006


2 0 1 4 T E C H T R A C K 1 0 0 L E A G U E TA B L E



Rank 2014


Financial year end

Sales growth% pa‡

Sales 2013/14£000

Sales 2010/11£000

In profit 2013/14


51MetaPack E-commerce software developer


52 35Qube GB Communications services provider

Scottish Borders Mar 14 63.23 †25,979 5,974 Yes 500 2007

53GBM Digital Apple reseller & repairer

Manchester Dec 13 62.96 17,774 4,107 Yes 35 1992

54 89Camlin Group Transport power systems developer

County Antrim Dec 13 62.10 †16,305 3,828 Yes 164 2008

55Next Generation Data Datacentre operator

Richmond Dec 13 61.61 8,023 1,901 Yes 33 2007

56Crimtan Digital advertising technology developer


57EDM Group Information management services

Wolverhampton Mar 14 61.14 †67,107 16,038 No 1,135 2003


Gloucestershire Oct 13 60.69 †16,365 3,944 Yes 20 2000


Hampshire Dec 13 60.30 †43,775 10,628 Yes 275 2002

60CMO Software HSE & compliance software developer

Central London Sep 13 58.77 †6,120 1,529 Yes 90 2007

61 55GGMR Digital marketing agency

Wiltshire Oct 13 58.02 †6,531 1,655 Yes 22 2003

62Masternaut Vehicle tracking software developer

Buckinghamshire Dec 13 57.59 †69,734 17,817 Yes 500 2002

63essensys Cloud service provider

Central London Jul 13 57.34 †5,350 1,374 Yes 24 2006

64 90Empowered IT consultancy

Bedfordshire May 14 57.28 †8,767 2,253 Yes 70 2006

65Emoderation Social media management agency

Central London Mar 13 55.37 6,248 1,666 Yes 435 2002

66 52Nomad Digital Transport communications provider

Newcastle Jun 13 54.16 31,565 8,616 No 191 2002

67Nostrum Group Financial software developer

Harrogate Dec 13 53.73 7,001 1,927 Yes 57 2001

68SecretSales.com Flash sales website


69 51Click Travel Travel management system developer

Birmingham Mar 14 51.91 †66,420 18,948 Yes 104 1999

70Displaydata Electronic shelf-labelling provider

Berkshire Mar 14 51.75 †14,019 4,012 No 62 2000

71CR360 Software developer

Cambridge Jun 14 51.75 †7,666 2,194 Yes 118 1999

72Aspire Technology Solutions Data services provider

Gateshead Feb 14 51.58 †6,188 1,777 Yes 51 2006

73 41Academia Educational IT consultancy

North London Jun 13 50.38 37,159 10,927 Yes 78 2003

74HighQ Cloud collaboration software developer

Central London Apr 14 50.38 †5,527 1,625 Yes 120 2001

75Eison Managed network services

Cheshire Oct 13 50.26 5,788 1,706 Yes 27 2006





Rank 2014


Financial year end

Sales growth% pa‡

Sales 2013/14£000

Sales 2010/11£000

In profit 2013/14


76Inspired Thinking Group Marketing technology provider

Birmingham Aug 13 49.81 43,254 12,866 Yes 218 2009

77Inoapps IT consultancy

Aberdeen Jul 13 49.63 16,750 5,000 Yes 200 2006

78Vermilion Financial software developer


79Zopa Peer-to-peer lending


80 85Purdicom Wireless network provider

Oxfordshire Dec 13 46.35 †12,520 3,994 Yes 33 2005

81 44The Test People Software testing provider

Leeds Mar 14 45.81 †6,954 2,243 Yes 104 2007

82 68Xexec Rewards programmes administrator

Northwest London Nov 13 45.48 †24,214 7,864 Yes 40 2000

83 43MOFILM Crowdsourcing advertising agency

Central London Dec 13 45.39 *7,896 2,569 No 47 2007

84Condeco Software Workplace management software

Central London May 14 44.62 †10,154 3,357 Yes 152 2000

85Core Group Telecoms services provider

Central London Jun 13 44.42 20,665 6,860 Yes 145 2005

86Reevoo Consumer reviews software & services

Central London Mar 14 44.41 †5,378 1,786 No 75 2005

87Seven Technologies Group Surveillance technology developer

County Antrim May 13 43.74 *10,039 3,380 Yes 82 2003

88TranslateMedia Translation services & software


89Marine Specialised Technology Bespoke boat designer & manufacturer

Liverpool Sep 13 42.91 14,445 4,949 Yes 92 2001

90Mobica Software engineering services

Cheshire Dec 13 42.62 †21,300 7,342 Yes 530 2004

91Leisure Pass Group Tourism smartcard developer



Cheshire Mar 14 42.57 †143,000 49,348 Yes 300 2001

93ustwo Digital product studio


94Rittman Mead Consulting IT consultancy

Brighton Dec 13 42.32 8,093 2,808 Yes 56 2007

95 374SL Data-backup services provider


96Periscopix Digital marketing agency


97Ikon Science Oil & gas software developer

Southwest London Mar 13 41.58 21,131 7,446 Yes 220 2001

98 81Fluidata Internet services provider


99 53Keytree Digital IT services

Central London Aug 13 41.25 11,665 4,139 Yes 120 2006

100 31Avecto Windows security software

Cheshire Jun 14 40.73 †8,447 3,031 Yes 97 2008




1 7 O N E S T O WAT C H

O N E S T O WAT C H

Ones to Watch showcases ten companies that did not meet the criteria of the Tech Track 100 league table, but have achieved strong sales growth, or are forecasting strong growth having received venture capital backing to fund their development.

Three companies on this year’s Tech Track 100 league table were tipped as Ones to Watch in 2013. They include smartphone keyboard developer SwiftKey (No 3), digital advertising technology developer Crimtan (No 56), and online collaboration software developer HighQ (No 74). Avecto, No 100 this year, and No 31 in 2013, was recognised as a Ones to Watch in 2012.

This year’s Ones to Watch has been judged by representatives of the sponsors of Tech Track 100 and Fast Track.

This year’s ten finalists are shown in the table below.

Co-founder and chief executive of M Squared Lasers, Graeme Malcolm.

Company Activity Location of HQ FYESales £000 Staff Founded

Black Swan Data Data science consultancy Central London May 14 2,000 19 2011

Elucigene Genetics testing kit provider Manchester Dec 13 2,200 6 1994

Feefo Customer review software Hampshire Mar 14 2,650 55 2010

Fetch Mobile marketing agency Central London Dec 13 34,613 45 2009

FreeAgent Online accounting software developer Edinburgh Mar 14 3,170 65 2007

M Squared Lasers Laser designer & manufacturer Glasgow Feb 14 5,010 42 2006

Playdemic Social games developer Cheshire Dec 13 4,360 65 2010

TransferWise Currency transfer services provider Central London Mar 15 10,000* 250 2010

TrialReach Clinical trial platform Richmond-upon-Thames Dec 14 2,224* 16 2010

YPlan App developer Central London Dec 14 $10,000+* 60 2012

Sales figures have been provided by the companies, and not yet filed at Companies House * Forecast


1 8 M E T H O D O L O G Y

M E T H O D O L O G Y

D E F I N I T I O N O F A T E C H N O L O G Y C O M PA N Y

The Tech Track 100 adopts the amended London Stock Exchange’s (LSE) techMARK definition of a technology company as one ‘that shows a commitment to innovation, research and product development, and operates in sectors including software, internet, telecoms and biotech’.

Q U A L I F I C AT I O N C R I T E R I A

n Independent technology, telecoms or digital media company

n Registered in the UK, unquoted and not subsidiaries

n Annualised sales of at least £250,000 in the base year (2010 or 2011)

n Annualised sales of at least £5m in the final year (2013 or 2014)

n Year-on-year sales growth from 2012 to 2013 (for 2010 base year), or from 2013 to 2014 (for 2011 base year)

n Excluded companies include pure computer resellers and those with qualified accounts. Also, following the launch on 15 July 2014 of the Financial Conduct Authority’s consultation on capping fees, we have excluded payday lenders from the 2014 league table

R E S E A R C H A P P R O A C H

The research was conducted by the Fast Track research team predominantly between May and August 2014.

The final 100 companies are ranked by growth in sales over their latest three years of available accounts, i.e. between 2010 and 2013, or 2011 and 2014. Companies were selected from a database of around one million private companies in the UK followed by extensive desk, telephone and case study research.

Of the 100 companies, 58 had financial years ending in 2013 and 42 had financials years ending in 2014.

Most companies on the league table were interviewed over the telephone, and visited by the Fast Track research team.


1 9 T H E V I E W F R O M B G F

TA K I N G T E C H F R O M T H E L A B T O T H E P R O D U C T I O N L I N E R E Q U I R E S A L O N G T E R M P E R S P E C T I V ELong term, growth capital investors are needed to support our high-tech manufacturers, writes John EgglestonTablet screen displays, efficient power transmission systems and liquid explosives detection are all technologies that are being developed by firms appearing on this year’s Tech Track 100.

These high-tech manufacturers, from London’s Apical (No.X), to Northern Ireland’s Camlin Group (No.X) and Oxfordshire’s Cobalt Light Systems (No.X), are growing quickly, reinvesting a significant proportion of their revenues back into research and development. Their growth is all the more impressive when you consider the capital required to commercialise their ideas in the first place.

Take Cobalt Light Systems, which was established in 2008 when it was spun out of the Rutherford Appleton Laboratory by Czech-born scientist Pavel Matousek and backed by early stage and angel investors. Its imaging software can detect the chemical make-up of materials through packaging and is used by global pharmaceutical companies and in airport security systems.

At BGF, we back similarly capital hungry cutting-edge tech companies with patient growth capital. For instance, Aberdeen-based SPEX Group, which develops new devices to improve well control during oil and gas extraction featured at No.4 on Tech Track 100 last year and in March we invested £5m for a minority stake to accelerate its growth here in the UK and overseas.

Many companies on this year’s Tech Track 100 will be less capital hungry, at least in their early days. Developing software and services that are internet-based and utilise cloud hosting keeps initial costs down. But those with ambitions to grow quickly and internationalise their operations will inevitably come up against a requirement for external finance sooner or later

Borrowing from a bank can work, but those with volatile cash flows can find servicing that debt is not always possible, or a combination of debt and equity better suits their needs.

BGF was established in 2011 to support Britain’s smaller and medium-sized growing companies across the UK. Backed by five of the main UK banks we invest between £2m and £10m in long-term, growth capital. We also provide follow-on funding – a sign that we are prepared to back the companies that we invest in for the long term rather than seek a quick exit. >

This London-based company’s digital media trading platform, DataLab, brings together automatic advertising auctions taking place across digital publishers such as AOL, MSN, Yahoo and Facebook so advertisers can get the most cost-effective placement of their adverts. It also recognises the consumer as he moves around the web to instantly personalise the ads shown. The Exchange Lab counts Sky, Ford and McDonald’s amongst its 300 clients, turning over £15.3m in 2013 under co-founder and chief executive James Aitken, 39. It secured £5m funding from the Business Growth Fund last December, to help finance its international expansion.

The Exchange Lab

Annual sales growth 99.02% pa2013/14 sales £15.3m2010/11 sales £1.9m2013/14 staff 81Founded 2007Location of HQ London

#21The Exchange LabDigital advertising provider



> Having made more than 60 investments to date we now talk to literally hundreds of management teams each year and find that many are looking for more than simply finance. They also want access to expertise and contacts, which we provide through our Talent Network, as well as portfolio collaboration and more informal dinners that we hold across the UK to bring entrepreneurs together to learn from each other.

Of the companies that make this year’s league table we have invested in Inoapps (No.X), The Exchange Lab (No.X) and Unruly Media (No.X), all of whom are making great strides in their respective markets.

> We were introduced to James Aitken co-founder of The Exchange Lab by one of our shareholders. His team have created a trading and intelligence platform, called DataLab, which leverages data to find the right audience at the right time at the right price for brand owners and ad agencies across digital platforms and devices.

The company has grown sales organically by on average 99% a year for the last three years and have a great customer base, including WPP, Ford in Europe and Dell in North America. They have tripled their global headcount to 150 people and were looking at ways to accelerate the development of their technology. That costs money and our £5m funding for a minority stake has helped to accelerate, as well as support their plans to expand in the US and the Asia Pacific region. We also introduced them through our Talent Network to Chris Dobson, a former BBC advertising senior executive, who has become their executive chairman, based in the UK.

“Chris Dobson has helped us scale the business”, says Aitken, who says BGF’s professional network was one of our appeals as an investor.

The company has used the funding we provided to develop its DataLab technology and continue its international expansion.

“We were looking for partner that was additive to our business,” Aitken adds. “What we really liked was their appetite to have the entire funding round, to make it one partner.”

Like The Exchange Lab, many of the companies on Tech Track 100 operate internationally while retaining their base in Britain, which is increasingly supportive of tech entrepreneurs. There are superb tax breaks for investors in early stage companies via the government-approved seed and enterprise investment schemes. These schemes are encouraging a huge amount of early-stage tech activity. >

This Aberdeen business installs, develops, hosts and supports Oracle IT products such as software applications, hardware and databases. Established in 2006 by chief executive Andy Bird, 40, with a focus on the oil & gas industry, it has since expanded its customer base into construction, defence and the public sector. In September last year it received £10m growth capital from the Business Growth Fund, and in December it bought Leicester-based IT consultancy Crocus Consulting for an undisclosed sum. Helped by strong demand from overseas customers sales reached £16.8m last year, and it plans to open offices in the US and mainland Europe.

Inoapps

Annual sales growth 49.63% pa2013/14 sales £16.6m2010/11 sales £5m2013/14 staff 200Founded 2006Location of HQ Aberdeen

#77InoappsIT consultancy



> The UK government is also stimulating investment in infrastructure, from high-speed broadband to start-up incubators and centres across the UK where research teams from universities collaborate with businesses to take their breakthroughs from the lab to the production line.

At BGF, we match that national focus, providing capital from our seven offices and backing companies from Southampton to Aberdeen. We have a technology focussed investor in each of our regions so they are able to work closely with the companies that we back and can meet the entrepreneurs of new companies looking to grow. For those tech entrepreneurs looking to see their company on the Tech Track 100 next year, now may be the time to drop us a line.

John Eggleston is IT Strategy Director at Business Growth FundFounded in 2006 by Scott Button, 41, Matthew Cooke, 36, and Sarah Wood, 41, Unruly makes video adverts ‘go viral’. The company’s proprietary social video platform enables it find the best distribution channels to reach target audiences. Since its launch, the Unruly Viral Video chart has tracked 430bn video views. Amadeus Capital, Van den Ende and Deitmers, and Business Growth Fund invested £15m in January 2012. Sales in 2013 hit £19.3m before the company acquired German competitor Shareifyoulike for an undisclosed sum.

Unruly

Annual sales growth 117.47% pa2013/14 sales £19.3m2010/11 sales £1.9m2013/14 staff 123Founded 2006Location of HQ London

#14UnrulyVideo advertising platform

BGF is one of a range of initiatives designed to forge better, more effective relationships between the banking sector and UK businesses. BGF works in close collaboration with the British Bankers’ Association as well as with other key business organisations and government across the UK. BGF is authorised and regulated by the Financial Conduct Authority.

Aberdeen 0845 600 3699Birmingham 0845 266 8862Bristol 0845 266 8864Edinburgh 0845 266 8863Leeds 0845 600 0142London 0845 266 8860Manchester 0845 266 8861

Website www.bgf.co.ukEmail [email protected] @bgf_team

Get in touchBusiness Growth Fund has been established to help Britain’s growing, smaller and medium sized businesses. Growth potential is the key criterion. BGF will invest between £2m and £10m per business in return for a minority equity stake and a seat on the board for a BGF director. BGF has up to £2.5bn with which to make long-term equity investments in growing companies across the UK that today do not have access to this source of capital.BGF is an independent company, backed by five of the UK’s main banking groups – Barclays, HSBC, Lloyds, RBS and Standard Chartered. BGF also works closely with other key business organisations.BGF has specifically been set up on a local basis to be close to the businesses we invest in. If you want to understand more about BGF or talk about how we might support your business, or your clients, please get in touch with us.

MINDTHEGAP.

Whether you have a gap in your funding, your knowledge, your contact book, your international reach, your talent, your capability or your boardroom, BGF has the capital, counsel and connections to fill it.

We are the UK’s most active providerof growth capital for companies withturnover of £5m to £100m.0845 266 8860 | www.bgf.co.uk

2014 techtrack 100 research report

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