These businesses are engines of innovation, helping to build the industries of the future while reinforcing the country’s appeal as a destination for entrepreneurial talent.
Many of these firms are headquartered outside London, contributing to the spread of wealth and prosperity across the UK – a goal EQ supports directly through our partnership with the Purpose Coalition to promote social mobility and inclusive growth.
AIM may have been launched in 1995 to provide companies an exchange that doesn’t have the demands of the Main Market or which may not fit the traditional private equity or venture capital model. But since then, it has developed into a mature and resilient segment of the UK’s capital markets, with its own ecosystem of investors, advisers and service providers.
It continues to be the most active growth market in Europe, responsible for more than half the capital raised across all European growth markets in the past five years.
The market’s economic contribution to the UK is significant. According to research by Grant Thornton, UK-incorporated AIM companies added £35.7 billion in Gross Value Added (GVA) to the UK economy in 2023 alone. They directly supported more than 410,000 jobs and paid £5.4 billion in corporation tax. Including supply chain effects, AIM’s total footprint rises to £68 billion in GVA and over 778,000 jobs.
Capital-raising has remained strong too: since 2017, AIM companies have secured over £39 billion in long-term funding, with 40% raising secondary capital in the past five years – totalling £45 billion since 2019.
While AIM’s track record speaks for itself, it needs to keep moving forward if it is to continue to play its vital role as an incubator of the firms of tomorrow.
That’s why EQ strongly welcomes the London Stock Exchange’s (LSE) renewed focus on strengthening the market and ensuring it remains fit for the future.
The LSE’s Shaping the Future of AIM discussion paper highlights several timely challenges – from reduced liquidity and regulatory complexity to perception barriers and limited retail participation.
It has invited feedback on a number of practical and structural improvements. These include reducing admission documentation, revisiting working capital requirements and offering greater flexibility around accepted accounting standards, dual-class share structures and the rules governing related party transactions.
EQ is a strong supporter of any reform that enhances AIM’s competitiveness. We believe the market’s regulatory framework must reflect the needs of high-growth businesses in the 21st Century and ensure it remains an attractive listing venue.
At the same time, the Quoted Companies Alliance’s (QCA) AIM Commission has made a number of recommendations to reinvigorate the AIM market. These include repositioning AIM as a distinct, growth-focused market through clearer branding and promotion, resetting its risk culture so rules are no more onerous than the Main Market, and stimulating capital flows via targeted tax incentives, pension reforms and new growth-oriented indices. As active members of QCA through our role in the expert groups, we contributed to the QCA response to the LSE discussion paper. We believe in the importance of ensuring policy reflects the views of small and mid-cap companies. We back the QCA’s efforts to secure a balanced and inclusive regulatory environment for all market participants.
Our support for AIM goes far beyond advocacy. EQ is a long-standing partner to many AIM-listed companies, offering services specifically designed to meet the needs of dynamic, ambitious firms at every stage of growth.
EQ provides shareholder management, company secretarial support, investor relations services, proxy solicitation, employee share plan administration as well as many other services to listed companies. We also support international issuers seeking to access UK capital through our Depository Interest framework, enabling efficient trading and capital raising on AIM.
With a client base spanning private and public markets, we help businesses navigate every step of their growth journey – from preparing for IPO, managing the settlement and Admission process, to scaling post-listing, or transitioning to the Main Market. Our tools, technology and experience ensure that AIM-listed companies receive high-quality, cost-effective support at every turn.
In other words, AIM is very important for us. But while we believe the index is a vital component in the UK’s capital markets toolkit, we see every day the things holding it back from being a more attractive vehicle for international founder-led firms.
This is why we also welcome the broader programme of initiatives aimed at revitalising the UK equity ecosystem – from the Mansion House Accord and the Leeds Reforms to the development of the PISCES platform, which aims to streamline private-to-public transitions.
Taken together with the LSE’s proposals for AIM, these reforms have the potential to restore London’s global position as a leading venue for innovative growth companies.
But AIM’s continued success is not guaranteed. It needs champions – among policy makers, regulators, investors, advisers and service providers. It needs thoughtful, proportionate reform, a supportive investor base and infrastructure partners who understand the unique challenges faced by growing businesses.
EQ is proud to be one of those champions. With decades of experience, a deep understanding of the small and mid-cap sector, and a proven track record, we remain fully committed to supporting AIM’s evolution and success – for the benefit of companies, investors and the UK economy as a whole.