October 21, 2005 Source: St. Mary's University:
http://www.smu.ca/newsreleases/2005/21-21-21-10-2005.html Study Identifies Characteristics and Contributions of Nova Scotia High Value Growth Companies High value growth companies are major growth engines for economic development in the region and policy needs to be developed to support these organizations and the entrepreneurs who run them, according a report that has just been released by the Saint Mary’s University Business Development Centre. The report indicates that nearly 2,000 new full time jobs were created by the 39 identified high value growth companies, accounting for up to 11.4% of the total provincial employment growth during the five year (2000 - 2005) time period studied. High growth companies are defined as businesses that double their number of employees in a five year timeframe and economic ‘value’ is the additional regional wealth created mainly through exports or import replacement. "It’s the combination of these two aspects that make high value growth companies important drivers in economic development," says Wayde Crawford, author of the 87 page report. "This report is unique because little is known about the characteristics of high value entrepreneurs and the growth companies they operate," he says. "It is anticipated that by developing a thorough understand of these types of individuals, appropriate support programs can be tailored to assist in their continued success." The study showed that the majority of these owners were either lifetime or long-time residents of Nova Scotia prior to launching their current business. The primary reasons cited for starting their venture were to take advantage of an opportunity, the need for personal fulfillment and to challenge themselves. Growth is a key strategic goal, business planning is very important to the success of these businesses and there is a willingness to share ownership, especially with employees. Nova Scotia high value growth companies come from a variety of industry sectors with manufacturing generally accounting for the largest number of those surveyed. These businesses are not necessarily reliant on the local market for their success, as a number of the entrepreneurial businesses do not even have sales in the Atlantic Canadian region. The report highlights that access to financing and the availability of qualified personnel are seen as the key limitations to continued growth for these companies. In order to secure the necessary growth financing, 70% of the business owners accessed multiple sources of funding from organizations like ACOA and Nova Scotia Business Inc. (NSBI). Recommendations in the report provide the basis for ongoing and continued support for high value growth companies. "In the short-term, information about existing programs needs to be delivered to businesses," Crawford says. "Additionally, procedures need to be put in place that will reduce the administrative effort and improve the response time of the existing programs. The continued support by government financing programs is also paramount." The report indicates that in the long-term, access to capital and the availability of qualified employees are key to the continued growth of enterprises here in our region. "Securities regulations and policies, like the province’s Equity Tax Credit and Community Economic Development Investment Funds, should be further developed to encourage and enable local equity investment," he says. "Youth entrepreneurship should be encouraged especially with an international focus. The ongoing needs of these businesses should be identified and proactive initiatives, such as employee skills and management training should be put in place as this would assist in the transitioning of businesses from small to medium, and from medium to large." Wayde Crawford is the Manager of International Projects and Senior Business Consultant at the Saint Mary’s University Business Development Centre, which is located in downtown Halifax, NS. The "High Value Growth Company Report" was funded by the Government of Canada and the Government of Nova Scotia and is now available by visiting "NEWS" at www.smu.ca/smubdc. Saint Mary's University is known for its community outreach projects, both in Canada and around the world. Saint Mary's, founded in 1802, is home to one of Canada's leading business schools, a Science Faculty widely known for its cutting-edge research, a comprehensive and innovative Arts Faculty and a vibrant Faculty of Graduate Studies and Research. Saint Mary’s University Business Development Center is a full service consulting and training organization tasked with providing skills development and business support services to SME sector. -30- For More Information: Paul Fitzgerald
Public Affairs Officer
Saint Mary's University, Public Affairs
(902) 420.5514
E-mail: paul.fitzgerald@smu.ca
www.smu.ca
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