The tech sector in London is growing at a ridiculous rate. You’ve heard this big old claim knocking about I’m sure, that London is the new Silicon Valley. Well, we’re convinced it’s starting to be true! The next decade is going to be a crazy fun and lucrative place for London-based high-growth, innovative technology developers. And here’s why…
First, the evidence:
London’s tech sector definitely is currently growing faster than Silicon Valley, found a recent report by industry analyser South Mountain Economics. And London is now the world leader in financial technology, employing more workers in the sector than New York City and San Francisco. While Oxford Economics predicts London’s tech centre will grow by £12billion and 46,000 more jobs by 2024.
So, if you’re based in the Old Street, Shoreditch area you can just feel the energy and entrepreneurial buzz. Our Hipsters, Hackers & Hustlers group alone is growing by 300 members a month!
Some recent East London claims to tech fame include Transferwise, Geckoboard, MarketInvoice, EDITD, Gocardless, Pusher, Mind Candy, Spareroom and Hailo. Check out this Guardian article detailing the top 20.
So what’s driving the boom?
A big catalyst to this trend was of course the recession a few years back, where lots of people were made redundant. And British people, being entrepreneurially minded, have been thinking, “Well, rather than being on benefits, let’s just get entrepreneurial. Let’s create something. I’ve got lots of good ideas, I may as well use them!”
Yes, the British entrepreneurial spirit is alive and kicking. And we have to give credit to the government too. There are lot’s of really, really good incentives from the government to help people start up in business. With tons of funding, loans, grants, tax incentives, free training and guidance.
The inherent beauty of technology firms
And of course it’s just the nature of the technology sector – it makes it easy! It allows you to do all kinds of wonderful things from your bedroom.
In the past you had to pay for office space, equipment, and all sorts of start up costs. But now people are starting crazy businesses from their back bedroom with their tablet, or a little laptop which doesn’t cost more than a couple of hundred quid these days.
Which tech sectors are leading the charge?
As you can see from that list of the top 20 startups, the three biggest sectors we’re seeing from London are Fintech (financial), Edtech (education) and Fashtech (fashion). These are the three really popular ones but pretty much every area is being covered, explored and pushed out to its limits.
Who knows what the next big tech sector will be!
Entrepreneurial spirit and hunger for risk – London Vs California
From the entrepreneurial side, people in and around London are becoming less and less risk averse. People are much more keen and willing to give things a go. When they’ve got a good idea, they just jump on in with both feet! But in terms of risk-aversity, the one thing that’s still lagging a little behind Silicon Valley are the investors. With technology in the US, generally investors are much less risk averse than they are here. So they’ll fund things much quicker, giving people a chance. It’s just in their nature, and with a longer history of success stories to get them excited.
And as for failure? They see it differently…in the US it’s, a badge of honour to have failed a couple of times!
So if you’ve already failed there you’re more likely to get investment than not. Whereas over here investors are a little bit slower off the mark, and a little bit more tip-toey about funding a start up. But that’s all changing little by little…but we’ll get there. Right now, investors can see the huge growth in the success of tech start ups just like anyone, so they’ll start putting in their money quicker. You’ll see.
All London needs – A Big Name Story
One thing London wants to really cement its place as a serious competitor to the Californians is a global high-profile example of some monster London-based tech success, as Rebecca Fannin points out in this Forbes article. Spareroom, Transferwise and Mind Candy don’t quite compete with Valley’s big boys like Twitter, Netflix, Google, or Facebook. Well, not yet anyway. But it’s early days for London’s tech boom and things are changing faster than ever. So come on you London-based tech whiz kids. Let’s show the world that the next Zuckerberg is going to come from Shoreditch!
What do You think about London’s tech boom? Are you riding the wave too?
Share your thoughts below!