By Bryan Hill, Director of Marketing & Business Development of Digital Media, Interxion
Just four years ago, I attended an event where David Cameron and Boris Johnson declared their vision of London’s answer to Silicon Valley. Today it would seem those dreams are starting to become a reality with the announcement last month that the technology companies located around Silicon Roundabout attracted a record $1.02 billion in investment in 2014. It is clear that Tech City is thriving and this capital injection has validated this part of London as an area of high-tech growth and innovation.
Today there are now over 34,000 digital tech firms in London. It’s a community of start-ups, large organisations and investors all looking for the latest opportunity. This number is expected to rise to over 45,000 over the next decade, yielding over £12 billion of economic activity.
But what has caused this rapid growth in this small area of East London? And how can we keep this momentum going to secure a long term future?
Going back to its roots
For me, it’s about maintaining the culture on which Tech City was founded on. This area of East London started out as a small cluster of technology and design companies just a short walk from the City of London. A relatively unloved area, artists were attracted by the cheap rent and large warehouse spaces to set up their galleries.
The artists’ presence attracted the digitally minded talent, bringing diverse cultures, attitudes and fashions together with a plethora of art and fashion studios, exhibitions (including The Art of The Brick), restaurants and pop-up eating stands. It is the archetypal London ‘melting pot’. People want to work here.
With its great transport links, a buzzing neighbourhood of likeminded people generating digitally driven ideas and a pool of technically skilled workforces, the bigger companies can see the attractiveness of this area. At the event I attended in 2010, David Cameron and Boris Johnson launched the initiative to line up support from companies such as Google and Facebook to invest in East London. They announced that it would be loosening the visa restrictions for entrepreneurs who wanted to set up businesses here. Just four years on from that event, tech firms and investors today feel more confident bringing money to the capital, evident in the migration of Amazon to Principal Place.
Is this sustainable?
As with any ecosystem, it is fragile and getting the balance right is crucial to its survival. Whilst the presence of these large organisations has undoubtedly contributed hugely to the £1 billion investment, there is the pressure to make sure their arrival does not dominate the area. Keeping the creative, start-up culture of which the very foundations of Tech City have been built on is just as important as the investments brought by the corporate giants.
As a large data centre with a long-standing presence in the heart of Brick Lane, we believe there is the need for companies to commit to supporting the next generation of talent and investing in the local Tech City community.
Interxion has some of the biggest media names in the world as our clients. But it’s not just about providing infrastructure to big companies but helping the smaller organisations too. Having a commitment to supporting smaller companies in their early stages of development is important to help enable their growth. Educating start-ups on about the affordable infrastructures available to them is one way which we can achieve this.
Generally speaking start-ups do not have their own infrastructure, preferring to use a cloud based infrastructure to keep overhead costs down and concentrate on growth. Affordable office space to keep overhead costs down is another draw of this area for start-ups. Tech City need to continue offering this to sustain the growth of start-ups. As a result of this, co-working where smaller companies share office space and collaborate with other companies will continue to bring likeminded people together and create a support network to generate big digital ideas.
This commitment to educate and support start-ups in London’s Tech City during their early stages of development is key to Tech City’s sustainability. Events such as the Evolution of Gaming is example of doing just that. Bringing together industry experts to talk about the future of gaming and where companies such as Microsoft and Sony are heading was a great opportunity for start-ups to understand the future gaming landscape and see where they fit in the bigger picture.
For Tech City to continue thriving, it is this investment into the education of start-ups that needs to be recognised as just as important as the investment of large organisations in the area. Put simply, creative start-ups need the investment and support to make their ideas come to life. Investors need creatives for that same reason. The culture that attracted the digital start-ups to this area in the first place needs to be sustained. Maintaining affordable office space and the artistic cultural buzz are crucial to attracting the talent which will sustain 2014’s billion dollar investment. By establishing this commitment to the growth and development of smaller start-ups in the area will keep the momentum of Tech City going. After all, they could just be the future Facebook, Uber, Zynga or Square.