Offices of Multiple Occupation
A fantastic open data set is the list of companies registered on Companies House. We've used Companies House data in things like the IoT Nation Database. Companies House is one of the inputs to the Inter-Departmental Business Register (IDBR) which, in turn, is used to create things like the Business Structure Database (BSD). The BSD then becomes one of the sources for things like the Tech Nation 2018 Report.
Lots of analysis depends on knowing where businesses are located. Companies House contains information about registered offices. That mostly means headquarters but, for an increasing number of companies, this may be a solicitors or management company that acts as their registered address. Government reports detailing business size and location, derived from the IDBR, warn that head offices have been used and that:
For various reasons it is possible to get multiple business registrations at a single address and this can distort data for smaller geographical areas.ONS
An ONS report - Multiple registrations at a single postcode: 2016 - goes into more detail about the reasons for multiple registrations at single addresses and gives an example of a VAT Office in Grimsby distorting the figures for North East Lincolnshire. But is it only smaller geographical areas that are affected? I looked at how many addresses had x companies registered at them.
I've used a log-log scale so that you can see the distribution more clearly. There are nearly 1.3 million addresses that have only one company registered at them and over 213,000 addresses with 2 companies registered at them. The bulk of the data would suggest that the number of addresses with more than several hundred companies should be below 1. But a few hundred addresses are outliers and they aren't insignificant in terms of the numbers of companies they represent. The busiest address is 20-22 Wenlock Road in north London. It has over 37,000 companies registered at it (as it happens Tech Nation is one of them). You probably wouldn't guess that from walking along it.
If we look at addresses with 400 or more companies registered at them, we can see that they tend to be biased towards London. That is unsurprising - given that it is a financial centre - but means that naively including these businesses might bias regional statistics as well as local statistics.
Using the latest Companies House data, there are 603,752 businesses at addresses with 400 or more registered businesses. I'm terming these Offices of Multiple Occupation (inspired by Homes of Multiple Occupation) and they make up nearly 14% of the 4.4 million businesses in the dataset (if we just looked at addresses with 1000 or more registered companies this drops to 8%). There isn't anything inherently wrong with companies being registered through management addresses. It just means being careful not to bias your aggregate statistics.