Tussell/techUK Tech200 deep-dive: what can we learn?
It's been a month since we revealed the Tech200: a list of the top 200 fastest growing technology companies in the public sector, produced in partnership with techUK.
Over the Christmas period we've been crunching the numbers behind the Tech200's impressive growth to answer the question: what can we learn from their meteoric rise?
Tussell Tech200: the key takeaways
Nearly £1bn was spent with the Tech200
£941 million was spent with the Tech200 in FY2020/21.
While this is impressive in and of itself, this spend represents a 341% increase on what was spent with the same suppliers in the prior financial year (£213m).
Be it through offering innovative solutions to new problems, bagging sizeable new contracts despite their size, or through building out their public sector networks, the Tech200 thrived against a backdrop of uncertainty.
Just under 1/3rd of Tech200 procurement went to SMEs
Tech200 SMEs earned 30% - or £281m - of the £941m FY2020/21 total spend.
Rather than solely relying on its largest suppliers during the troubles of FY2020/21, the public sector put its trust in smaller suppliers to provide innovative and fresh solutions. So much so, in fact, that 9 of the top 10 Tech200 companies were SMEs.
The large chuck of revenue taken by SMEs among the Tech200 is testament to how sizeable, important public sector work is not the reserve of large, well-established suppliers.
Edtech & Healthtech account for over half of Tech200 revenue in FY2020/21
Of the £941m spent with Tech200 suppliers in FY2020/21, 29% - or £270m - went to Edtech suppliers, while 22% - or £205m - went to Healthtech suppliers, totalling £475m (51%).
The Department for Education accounts for 99% of this Edtech spending, while Oxford University Hospital, the NHS Foundation Trust, and the Department for Health & Social Care made up 25% of Healthtech spend.
At least 28 companies on the Tech200 - or 14% - were Healthtech or healthcare-related, while 5 were explicitly Edtech providers.
Larger Tech200 members diversified their client base
Finally, we observed that some of the larger Tech200 greatly diversified the number of public sector buyers they worked with.
Three notable examples include: Cancom Managed Services Ltd, who grew their no. of unique public sector buyers from 8 to 13 between FY2020 and FY2021, culminating in a 361% increase in spend revenue (£6.7m to £31.2m); Softwareone UK Ltd, who saw a rise from 30 to 56 clients, and a 277% revenue rise (£11.9m to £45.1m); and Daisy Corporate Services Ltd, who saw a rise from 54 to 87, and a 185% rise (£7.1m to £20.2m).
On the whole, however, the correlation between the Tech200's growth in spend and diversification of customers isn't strong. Many firms experienced a surge in public spend with only a handful of extra clients. A notable example is Computacentre, whose public revenue jumped from £34m to £294m across the Tech200 period, but whose number of different public buyers hardly changed.
The story of Computacentre - and many others like it - shows that the more public clients you have doesn't necessarily mean a big jump in revenue: consolidating your relationships with a smaller pool of buyers is a tried-and-tested strategy.
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Diving into the Tech200 gives hints as to the state of both the public sector tech market, and the public sector as a whole.
There's lots more to learn from the Tech200: we’ll soon be chatting with some of the Tech200 members to better understand how they were able to sell so successfully to the public sector. Subscribe to the Tech200 mailing list to not miss out!
This article was written by James Piggott, Tussell’s Marketing Executive. You may read the full blog on Tussell's website.
