Scottish Enterprise writes off £30m in failed deals
Scottish Enterprise last year wrote off £30 million in failed investments, though it booked a record £106 million from the sale of companies.
Among the failures were a magazine publisher, a home alarm system and company wanting to produce energy from kites.
The value of its interests in 111 companies was written off over the 12 months to the end of March 2023, according to its annual report. This mainly through loans or grants typically provided alongside other investors.
The largest single write-off was £3.3 million in Boundary, a company developing a home alarm system which went bust earlier this year.
There was a £366,000 write-off for Network90, a members-only networking portal focused on the football industry, while almost £2.3m was lost with the failure of Team Rock, the publisher of magazines such as Classic Rock and Metal Hammer, as it struggled to make the switch to digital media.
Scottish Enterprise, the country’s main economic development agency, has written off about £180m since 2010 in failed investments.
A Scottish Enterprise spokesman said: “Investment in early-stage activity always carries risk, but since our investment activities began in 2003 we’ve generated £470m in income for the Scottish economy and helped leverage £2.3 billion private sector investment into companies.
“In fact, Scotland’s 2022 results for total investment hit £953m — the best on record.”
Its successes over the years include an investment in the flight search engine Skyscanner which was acquired by a Chinese company for $1.7 billion in 2016.
It also made a big gain on Current Health, a medical devices maker which was acquired for $400m in 2021, and Exscientia, an artificial intelligence spin-out from Dundee University and now based in Oxford.
Scottish Enterprise chief executive Adrian Gillespie told a committee of MSPs in October that the agency would need to a a “much smaller organisation” as a result of its budget being squeezed.