UK small and medium-sized enterprises (SMEs) are setting their sights on ambitious growth plans following a year of strong performance, according to a recent survey by Shawbrook.

The survey, which focused on businesses that experienced growth, found that 44% of these SMEs are considering an initial public offering (IPO) within the next five to ten years. This wave of optimism is also driving plans for mergers, acquisitions, and regional expansion.

With 46% of all SMEs reporting growth over the past year, the sector is experiencing a surge in confidence, with 86% of respondents expressing optimism for the year ahead. Notably, 27% of business leaders stated they feel extremely confident about the future.

The survey highlighted that nearly half of the financial decision-makers and business owners surveyed are exploring a range of strategic growth opportunities. Beyond IPOs, 41% are contemplating acquisitions, and 42% are considering mergers as key avenues for expansion. Internally, 52% of SMEs are focusing on team growth, with significant attention on upskilling existing staff and expanding leadership teams.

Investment in staff remains a top priority, with 53% of businesses planning to hire new employees and 50% aiming to enhance the skills of their current workforce. This internal growth strategy is seen as essential to sustaining the momentum gained from recent successes.

Financial planning is also on the agenda, with 45% of SMEs that have seen growth over the past year planning their next funding round within the next five to ten years. Additionally, 51% are preparing for significant capital expenditures, and 49% are considering applying for new loans or lines of funding to support their growth ambitions.

Neil Rudge, Chief Banking Officer, Commercial, at Shawbrook, commented: “Stronger economic conditions are fuelling a new wave of growth for SMEs. Our research shows renewed confidence after a challenging period, with business leaders setting ambitious plans. This surge in activity aligns with discussions we’re having at Shawbrook, reflecting optimism across the UK economy. Building a strong partnership with a dedicated lender is key for SMEs. When lenders take the time to truly understand their business, financing becomes a strategic tool for success, not just a transaction.”