Several commentators have sought to make political capital from the recent announcement that M Squared Lasers, which had received £34 million in equity and loans from the Scottish National Investment Bank (SNIB), went into administration and ceased trading.

Noting that the SNIB was an “SNP flagship project” established when Nicola Sturgeon was First Minister, one Conservative MSP commented that it was “taxpayers money down the drain”. This criticism is common when businesses that have received funding from government and subsequently fail. But is this narrative actually correct?

The implication is that the investment in the failed company disappears into thin air when they close down. But the reality is that the knowledge and skills developed within these firms — which are embodied in its employees — don’t disappear when they close. Instead, they are likely to be recycled, which benefits other businesses in the ecosystem.

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High-profile collapse poses big questions for Scottish bank

Let me offer an example that I have researched in detail. Consilient Technologies — a firm based in Newfoundland and Labrador, one of........

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