The potential closure of the AIM market raises significant concerns and hopes from various stakeholders.
- Claire Milverton, CEO of 1Spatial, credits AIM for her company’s success and worries about losing it.
- A recent report suggests a shift to the main market could damage high-growth firms by increasing regulations.
- 1Spatial’s recent expansion in the US highlights AIM’s role in fostering growth and innovation.
- The potential removal of AIM could reduce funding options, affecting smaller firms.
The AIM market’s importance to certain companies is evident through the experiences of Claire Milverton, CEO of 1Spatial, a data management firm. Milverton asserted that AIM’s environment has been crucial for the company’s development, providing necessary financial avenues during challenging times. She highlighted that AIM allowed 1Spatial to raise funds to pay off debt, invest in technology, and expand into the U.S., demonstrating the market’s integral role in their growth journey. “We had a difficult time a few years ago where we had to raise some money to pay off bank debt and it gave us the money to invest in our technology and allowed us to expand to the US,” Milverton stated.
Recent discourse has emerged around a possible closure of the AIM market, proposing its integration into the London Stock Exchange’s main market. A report by the Tony Blair Institute criticizes AIM, suggesting it has failed its primary goal of supporting scaling businesses, leaving the London market dominated by legacy firms in energy and finance sectors. It advocates for a new “special route to listing” for high-growth companies in emergent tech sectors.
Milverton cautioned against the absorption into the main market, citing increased regulatory burdens that might be detrimental to 1Spatial. She expressed concerns about the potential lack of support from main-market shareholders, who might be less forgiving towards firms not issuing dividends. “I think the market is excellent for companies like us so we are not burdened with a full list of regulation,” she explained.
Despite these concerns, 1Spatial continues to thrive, reflected in their rising share value following promising revenue reports. The company has successfully expanded across the Atlantic, securing new contracts in 21 U.S. states and establishing significant ties across Europe, including a substantial deal with a UK county council. The company’s revenue grew by 5% to £16.2 million for six months up to July, with pre-tax earnings surging 18% to £2 million.
James Ashton, representing the Quoted Companies Alliance, underscored AIM’s essential role for growth companies not yet prepared for the main market’s demands. He warned that eliminating AIM could constrict UK funding landscapes, enforcing a one-size-fits-all regulatory approach detrimental to innovative, smaller firms.
The uncertainty surrounding AIM’s future brings to light the critical balance between regulatory structures and the nurturing of emerging businesses.
