By Maximilian Clarke
There has been a lot of media coverage recently on the rapid growth of the government’s ‘Tech City Initiative’ at the Old Street/ City Road interchange in the East End of London.
Dubbed ‘Silicon Roundabout’, David Cameron has visited the area twice in a year to witness the rise of start-ups and multi-national high-tech firms alike. So what is all the fuss about and what does it really mean for small businesses?
There is no doubt that this former non-descript, notoriously shabby corner of London has undergone a transformation and is becoming more famous as a technology cluster-bed than a traffic black-spot due to government support and organic growth. 600 small technology companies have set up shop in the area’s previously derelict warehouses since 2008, from Web 2.0 developers to electric car designers, all confident that they can rival larger firms across the world. This growth is a welcome contrast to the all too familiar, doom-filled economic reports of recession that have been swirling around the media for the past four years and dampening small business confidence.
‘Silicon Roundabout’ is by no means the only small business growth area in London or the UK, but it is attracting a large flock of new businesses for several reasons:
• Start-up costs are relatively cheap due to low rental rates in comparison with the nearby City; for example in July 2010 ‘TechHub’ opened to provide low-rent, low-commitment workspace for hundreds of entrepreneurs ( a desk space can be rented for £250 a month)
• The culture of the area inspires creative entrepreneurs; within an hour’s walk from Old Street Roundabout there are 100 galleries
• The existing success of start-ups is a testament to the area’s potential; for example social media company Mind Candy launched Moshi Monsters last year, a game for under 13s, which is predicted to generate £60million from merchandise alone by the end of this year.
• There is financial support available for start ups: a new initiative called ‘City Meets Tech’ is encouraging bankers to invest their bonuses in Silicon Roundabout ventures, and events like ‘Seedcamp Week’ in January 2011 helps entrepreneurs to network and compete for funding.
With all these factors combined, Silicon Roundabout is exuding a buzz of hope and energy. While there is a lot of work still to be done, the raw potential the area holds is sparking waves of interest far and wide across the business population.
“The recent rise of ‘Tech City’ presents a very exciting opportunity for small businesses across the UK. It is sending out a message of optimism, and proving that growth and success is a realistic and achievable goal despite hard economic times,” says John Davis, Managing Director of Business Centric Services Group, providers of cloud based products and services to businesses around the world.
“We are proud to be part of the Silicon Roundabout community and success ourselves, having recently purchased an office on Old Street to accommodate our growing workforce. In 2006 we launched with a workforce of 6, today we have 60”.
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