Being privileged to earn my crust closely monitoring the rapid expansion of the tech and digital economy – both here at MBS and previously over the course of six years at Google – there’s no doubt in my mind that we have reached a critical point in Britain’s tech revolution.
Put simply, we’re no longer a country with a tech hub. In little over a decade, almost every major city in the UK can claim tech success stories, from early-stage scale ups to fully-fledged global leaders.
Of course, a default London focus is inevitable, with Silicon Roundabout the first and largest concentration of innovative startups to have landed and organically expanded in recent years.
But adjust your gaze north of Watford – or in any direction for that matter – and suddenly you’ll see cities building their own technology infrastructures capable of attracting the very best talent and investment.
Some may say I’m biased, being Mancunian myself, but consider the digital brands that now call the North West home, including Moneysupermarket.com, Shop Direct, Boohoo, Missguided and Pretty Little Thing. Boohoo alone is taking the world by storm, with a £50m new share listing and sales growth of 106% in the first quarter of 2017, and there are so many more success stories.
Manchester is also a hub for ground-breaking new technologies like augmented and virtuality reality, having become the European HQ of EON Reality and the home of Digital Bridge. AO.com, LateRooms.com, LADbible, Rentalcars.com and Social Chain are just some of the other big names based in the city.
A far cry from the clichéd view of post-industrial Manchester, with its abandoned factories and red brick chimney stacks, the city has reinvented itself as a prominent tech hub, in part thanks to the presence of several vibrant accelerator programmes that offer routes to investment, advice and networking opportunities.
Among these is Tech North, an initiative delivered through the government-backed Tech City UK, which focuses on the cities of Hull, Leeds, Liverpool, Manchester, Newcastle, Sheffield and Sunderland.
And their impact is significant. By their calculation, a staggering 75% of the companies driving growth in the digital economy now exist outside of London.
Shop Direct now employs over 2,000 people at its Merseyside head office across teams covering ecommerce, IT, design, data and analytics. Group people director Jacqui Humphries tells me that over the last decade, the business has seen Liverpool grow into a vibrant and exciting digital hub.
“The city region is home to lots of innovative and fast-growing digital businesses and a number of world class educational institutions offering some good, digitally-focused courses,” she says. “We’ve been able to attract and retain some of Merseyside’s and the world’s best talent to our HQ in Speke, and will continue to do so.”
Jacqui acknowledges, though, that there are still challenges in trying to lure talent away from the bright lights of London, where big beasts like Google, Facebook, Uber and Airbnb all have offices.
Shop Direct is expanding its presence in London this summer with the launch of a new office at 111 Buckingham Palace Road, but it plans to continue investing in its Merseyside base while developing local talent through partnerships with universities, schools and networks like Liverpool Girl Geeks.
“There’s lots to do but we believe that, with a focused and collaborative approach, we as a community can feasibly drive Liverpool to a point over the next 10 years where it can compete with the very best in the world for digital talent. And that can only be a good thing for Shop Direct.” – Jacqui Humphries, group people director, Shop Direct
The Tech Nation survey by Tech City UK found that 68% of total UK digital tech investment in 2016 was in regional clusters beyond the capital, with six clusters alone attracting nearly £700m investment between them: Edinburgh (£159m) Cambridge (£153m), Bristol & Bath (£109m), Oxford (£106m), Manchester (£78m) and Sheffield (£61m).
It is not hard to see why. Location matters less and less in our super-connected world of video conferencing, live file sharing and remote working. Entrepreneurs can now set up operations where they feel most comfortable and where they want to attract talent.
And when you can add physical interconnectivity to the digital, the options increase even further. HS2, the much-fêted Northern Powerhouse strategy and upgrades to the broadband and mobile network infrastructure are indicative of efforts to rebalance the economy away from London.
As a kid, a train journey from Manchester Piccadilly to London Euston required a half-day window. Today, on the Pendolino, it’s a workable commute.
But it’s not just practicalities that make Manchester and other cities such attractive centres for entrepreneurs and investors. In an age where digital literacy is the highest it’s ever been, with affordable consumer hardware, ubiquitous high-speed internet and a dizzying range of software options available to all, the barrier to entry has totally disappeared.
A 12-year-old with a laptop or mobile in Newcastle can run a multibillion dollar company from her bedroom in the same way a 60-year-old can from the desktop in his Zone 1 office.
Manchester, Edinburgh and Bristol – much like London, Cambridge and Oxford – host outstanding academic centres, producing an ever-growing and dynamic talent pool. Equally importantly, they also boast their own vibrant cultural scenes. And that really matters.
Many young tech entrepreneurs view lifestyle and the regional identity of their brand as just as important as what they do and sell. A quick stroll around Manchester’s Northern Quarter, where many tech startups are based, demonstrates how closely local businesses are integrated with the local social scene, in the same way that Shoreditch, Hoxton and Aldgate have evolved distinct microcosms all of their own.
The growth and expansion of British tech hubs should provide food for thought for any company looking to attract the best hires. Regionality also provides a workforce representative of the customer base, an issue capital city-based companies have struggled with for decades.
We at MBS work with businesses across the UK and the globe, and we’re going to be deep-diving into more of these vibrant tech cities in the coming months, starting with a trip to the North West next month (There’s nothing like a home-cooked meal).
And a world where company location, access to funding and resources no longer limit the perfect candidate from joining a business, or the entrepreneur from launching their enterprise, can only benefit the economy, leading to increased opportunity for employers and employees alike.
Stephen@thembsgroup.co.uk | @SteRosenthal | @TheMBSGroup
Credit for main image: www.tecmark.co.uk