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Sturgeon, which celebrated reaching ‘adulthood’ last night with a charity event at the Caledonian Club in London, also announces today that it has opened an office in Hong Kong, where it will be a regulated investment manager and asset gatherer known as Sturgeon Hong Kong.

There is substantial market potential in Hong Kong because of growth in start-up managers in Asia, UK fund managers requiring more access to family offices and funds of funds based there and managers who, for many reasons, split their time between the territory and London.

Regulatory incubators" provide third-party investment management, investment advice and compliance and eventually direct authorisation support to start-up financial services businesses until they can be directly regulated in their own right. The service has been particularly in demand since the global financial crisis, with many individuals leaving large institutions to set up their own operations.

Sturgeon’s analysis estimates that there are currently around 800 firms that are appointed representatives of incubators.

Sturgeon has seen inquiries from prospective appointed representatives rise to 112 in Q1 2016 from 66 in the same quarter last year. The number of inquiries rose from 165 in 2013 to 240 in 2014 and 261 in 2015. The figure is 48 so far this April.

Seonaid Mackenzie, Managing Partner at Sturgeon, commented: “The growth in the regulatory incubator sector has been striking. We led the way in educating the market about this type of service and as more entrants came into the space, its benefits and potential became more widely known. Start-ups are frequently advised by legal firms and other service providers that this is a faster and often cheaper route to market.

“Also, in the venture capital world, with the grown of crowdfunding and other platform businesses, the incubator is a way for start-ups to begin and have experienced teams of people navigate the regulatory space, which is more and more complex and expensive.

Time to market is still a key issue for start-ups, with direct authorisation taking upwards of six months or more. There are also a number of foreign firms taking this route to get to know the UK/European Regulatory landscape before direct authorisation.”

Going forwards, the sector will continue to grow. Brexit does pose a risk but the principle of demand for this type of service will continue, both in the UK and across Europe.”