“Remarkably, growth rates have hardly budged for the best companies in the sector, and this is particularly impressive for the scale-up companies represented in the Emerging Stars category,” Ian writes in the foreword to the Megabuyte Emerging Stars 2022 report. “So, the first thing I have to say is an even more emphatic than usual congratulations to all 25 Emerging Stars companies, and to the award winners in particular.” 

This resilience among the Emerging Stars was demonstrated by high-growth businesses such as CyanConndode (pictured), which provides wireless communication technology for smart metering, lighting and IoT (internet of things) applications. It stood out from its peers by winning the Fastest Growing Company category – no mean feat when average organic growth rates nudged up to 46% in 2022 from 45% in 2020 among the wider cohort. Notably, that organic growth has been married with profitability among most of the businesses included in the awards. Owing to the normalisation of digital transformation across the economy, Ian even believes that the rate of organic growth may increase next year.

Employing the Megabuyte Scorecard, tailored to businesses with revenues of between £3m and £10m, the report identifies the following top five performers from the larger Emerging Stars pool of 25:

 1. FSP (score of 90) – Overall Winner and Best Performing Company (IT Consulting) 
Provides digital strategy, programme delivery, cloud engineering, bespoke application development, data, automation and cyber-security services to medium and large enterprise clients. 

2. SecureCloud+ (score 89) – Best Performing Company (IT Managed Services) 
Provides cloud and related IT services, including private cloud-managed services, networked collaboration services, enterprise mobility and other security-related services focused on defence and the public sector at various levels of security clearance. 

3. Envitia (score 88) – Best Performing Company (Enterprise Software and Overall) 
Provides geolocation and data modelling, architecture, and analytics software solutions and related services primarily to large defence and public-sector organisations in the UK and US. 

4. Jola (score 88) – Best Performing Company (Telecoms Services) 
A mobile airtime platform provider focused on mobile machine-to-machine (m2m) data services, targeting the retail, transport, logistics, public sector and broadcasting sectors through the channel.

5. Cardinality.io (score 88) – Best Performing Company (Business and Consumer Software) 
Cardinality provides an artificial intelligence-driven data ingestion and analytics platform focused primarily on the telecoms sector.

This year’s awards showed the highest proportion of ICT and Digital Services companies (16). This could be a reaction to the ICT demands triggered by working from home, as well as software, such as equipment and accelerated digital transformation programmes. 

All of the top five performers are externally backed, and indeed this approach to funding is true of 15 among the list of 25. In 2018, four of the 25 were externally backed, suggesting that access to capital is a positive. Many previous winners have used the capital at their disposal to augment their strong organic growth with acquisitions. 

In the words of the report, the hunted have become the hunters.

Neil Bellamy, National Sector Head of Technology, Media, Telecoms and Services at the bank, welcomed this development: “The marked increase in equity backing of these small but high-growth tech firms is really good news. Combined with access to our debt funding, we’re seeing many more of these firms maintaining high growth for longer. Hopefully a sign that our Emerging Stars have the ambition to get bigger rather than sell early – we may be seeing the emergence of the UK Tech Mittelstand.”