UKIE: It's a myth that creative industries are risky investments
New report hopes to dispel stigma harming growth
A new report compiled in conjunction with UKIE has found that businesses in the creative industries are a less risky investment than the majority of other business sectors.
The Risky Business report found that the survival rate of creative industries businesses five years from birth averages 49.7 per cent, compared to 46.9 per cent for businesses in the rest of the economy.
UKIE hopes the report can tackle the myth that creative industries business - including the video game sector - are a risky investment for banks and financial institutions.
"Interactive entertainment businesses are too often seen as a risky investment, and this report will debunk some of those perceptions," said UKIE chairman Andy Payne.
"It will also raise awareness of the growth potential of interactive entertainment and the creative sector generally, as well as being a key driver to help improve access to finance for innovative games businesses in the UK."
There were 182,100 companies operating in the creative industries in the UK in 2010, employing approximately 2.3 million people and accounting for 7.8 per cent of the workforce.
The report states that the risk associated with creative industries businesses is overstated and companies suffer from a stigma, with good business propositions being turned down due to prejudice.
The report, conducted by think tank Demos, calls for the government to review its definition of the creative industries, as it does not currently include fashion retail or fashion manufacturing. It also says that the Department of Business, Innovation and Skills - responsible for policy that might support SMEs in the sector - does not have any civil servant resources focused on the sector.
"The UK has a deep competitive advantage in the creative industries," concludes the report. "With better reporting and analysis of the sector from Government, combined with a coordinated effort to build business skills, fund businesses appropriately and champion the sector with investors, the sector itself can deliver on its promise of significant economic growth."