What a ride the last few weeks have been.
Since I became Head of Tech North at the end of April, I’ve met with over 400 people, judged startup competitions, given a speech at the House of Lords, given out awards, sat on panels, attended tech conferences and become very familiar with northern rail’s timetable. I’ve met entrepreneurs, investors, digital leaders, council & LEP representatives and government.
We’ve convened and chaired meetings with representatives from the region to discuss and address a wide range of topics from the use of EU and public funds to support tech entrepreneurs to broadband coverage to exploring the ‘northern narrative’. We’ve received a delegation from China interested in developing relationships with tech companies in the North. We’ve been building relationships with other regions around the UK and Europe from Berlin to Scotland. We’ve been advocating for the North’s strengths in fin tech, health tech and other sector specialisms. We’ve received support from MPs, entrepreneurs, community leaders and local government. And we’ve interviewed over 150 candidates and recruited a fabulous team, some of whom took up their posts in the last couple of weeks and some will be joining us in the next few days.
In every interaction, I’ve been reminded of why I love this part of the world. And at the same time, I’ve been reminded of the challenge ahead of us.
Why do we need Tech North?
There are many incredible tech businesses in the North. AO.com in Bolton was one of the largest IPOs of 2014, while Sage in Newcastle is still the UK’s only FTSE100 technology company. Traveller’s Tales in Knutsford makes my son’s favourite Lego Star Wars game, and Universal Everything in Sheffield provides content for the largest digital screen in Times Square. Over 180,000 people are employed in the digital sector in the North of England. Hull boasts a world class super fast broadband network whilst Liverpool was cited in the Tech Nation 2015 report as the 2nd fastest growing tech cluster in the UK.
However for all these success stories there remain challenges for entrepreneurs looking to start and scale tech businesses in the North. Data published by the UK Business Angels Association showed that in 2012/13 the North received the lowest proportion of angel funding in the UK: despite having 23% of the UK population, the region received approximately 5% of funds.
And there’s a similar story with accelerators and incubators – these are valuable sources of early stage support and pre-seed and seed funding, offering mentoring, pitch practice and access to investor networks. There are currently only three accelerator programmes in the North. There are around 36 in London.
The challenge for investors interested in investing in digital businesses in the North is finding deal flow; where can they find backable entrepreneurs? And for existing digital businesses that are scaling and growing some experience challenges with finding the digital talent needed to thrive.
Why focus on the digital economy?
The digital economy is increasingly flourishing and underpins all economic activity. It’s a key driver of innovation and skills across all sectors. It contributes around 12.4% GDP per year to the UK economy, and the UK has one of the fastest growing digital economies in the G20.
This is where Tech North comes in. The government has given us a remit to accelerate the growth of digital entrepreneurship in the North of England. By working together as a community across the North we can be greater than the sum of our parts.
But what does this really mean? And how will it work?
We aim to influence growth in venture capital and business angel investment, to help more great digital startups and scale-ups growing employment in the region. The goals are clear: raising the profile of our brightest entrepreneurial talent and developing the digital skill set of the region, working with the public sector to shape the funding landscape, and identifying strategies to develop, retain and attract talent.
Ultimately, it’s about making the whole ecosystem work as efficiently as possible, creating a virtuous circle where it can attract even more talent and investment.
We’ll also focus on what Hugh Campbell of GP Bullhound refers to as ‘neural networks’ and what Sandy Finlayson of MBM in Edinburgh calls the ‘invisible glue’. I call it ‘relationship capital’: an essential ingredient in business success. It helps you learn what has worked for other businesses and what doesn’t. It reveals opportunities and opens doors. It helps you to find inspiration, mentoring, support, a co-founder or an investor. The entrepreneurs who are best at raising capital are those who understand that you start by building a relationship with possible investors many months – preferably years – before you need the investment. It’s about the buzz and credibility you build around you and your business.
It matters to our team, too. As a small organisation, we must collaborate and work with leaders and organisations across the digital economy; with entrepreneurs, investors, universities, public sector and government.
The Northern tech story is already a successful one. Imagine what we can achieve if we all work together, creating an environment that allows digital businesses and innovation in the North to thrive and ensures that the UK economy as a whole reaches its greater potential.
We are Tech North
Celebrate + Inspire + Accelerate