tech startups

Why The UK Is A Magnet For Tech Hubs

Linkilaw Startup Advice & Tips

The UK tech scene is booming, and unicorns are showing up around every corner. No, we’re not speaking of the mythical horse-like creatures with long horns and cloven hooves. In tech hubs speak, a unicorn is a company which has achieved a $1bn or higher valuation, based on fundraising.

Apparently the UK boasts 17 of Europe’s 40 companies with unicorn status, and surprisingly, the acquisition age of these tech entrepreneurs rounds out to only 35 years. Thirteen unicorns are based in London alone: ASOS, JustEat, Skrill, Wonga, Zoopla, Farfetch, Transferwise, Shazam, Funding Circle, Markit Group, Ve Interactive, Powa and Rightmove.

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The UK Is Hot Property

The total new registered companies for 2015 comes in today at 403,614 – up 24,788 in just the last 2 weeks! It’s amazing to watch these numbers keep climbing daily; so far 42,575 this month and 638 for today (August 25th). As it relates to UK tech hubs and its workers, it is projected that the city of London will be generating over 46k new tech jobs by 2025!

The Future Fifty initiative, a programme underway with Tech City UK, is tracking the growth of 50 companies, with Shazam and Transferwise so far creating 6x the national average of new jobs. The Future Fifty firms have increased their workforce by 30% over the last year, roaring past the national average of 5.4%

The UK Has The Talent

According to the Huffington Post, the UK tech hubs have a bit of a gift for attracting and incubating talent. Cutting through the ‘red tape’ and making company registration readily accessible, the UK’s comparatively attractive quick-start process means you can virtually start up a new company in less than one week; of course, you’ll want to check in with small business legal services to choose the right structure first.

Another key factor in UK tech hubs business popularity is its low corporate tax rate – approximately 50% that of the U.S., it has dropped 8% since 2009 according to KPMG’s tax rate tool:

UK corporate tax

As to education, during the school year 2014-2015, the Universities of Oxford, Cambridge and London’s Imperial College were ranked in the top ten list of the best global institutions; judged across the core missions of teaching, research, knowledge transfer and international outlook.

The Global Talent Competitiveness Index, in which the UK placed 7th in a field of 93 nations, explores the way countries establish the kind of environment which attracts, grows and keeps a world-class pool of talent. Here’s a thoughtful and informative interview with Paul Evans, Academic Director of the INSEAD Global Talent Competitiveness Index and Bruno Lanvin, INSEAD Executive Director for Global Indices:

The UK Is A Security Trailblazer

Cyber threats are real and prevalent in the world today. From cybersquatting and identity stalkers – to hackers breaking into and shutting down whole organisations – the results can be devastating. As technology grows, so do the numbers of those who would use it for harm, forcing us to become more responsible for regulating and oversight.

The UK has invested £860 million into a 5-year National Cyber Security Programme (launched in 2011) to reduce and thwart cyber threats; hoping to create one of the safer global locations to do business, especially over the Internet. According to a National Audit Office 2014 review, the NCSP  is “making good progress in improving its understanding of the most sophisticated, high tech threats to national security.” The NAO did warn that the changing nature of the cyber threat meant that government “must increase the pace of change in some areas to meet its objectives.”

The Office of Cyber Security and Information Assurance explains that “having enough people with the right skills…is paramount, and to this end we have in place interventions across education and beyond, including apprenticeships and student placements. We sponsor cyber competitions in schools, technical apprenticeships and PhDs; we’re building cyber security into computer science and computing degrees; and have so far accredited six master’s degrees in cyber security, created two new Centres of Doctoral Training, three Research Institutes and 13 Academic Centres of Excellence in cyber security research.”

Location, Location, Location

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Size matters, for this nation of 64 million subjects packed into 243,610 square kilometres (or 94,060 square miles). If we’re comparing notes, that’s about 60% the size of California, with 65% more residents. Certainly the UK is densely populated, but this doesn’t necessarily mean everyone has to take up permanent residence.

One great thing about technology is that once it’s learned (or established) you can ‘do it’ from just about anyplace and anywhere; on a plane, in a car, across the world, stretched out on the beach on a working vacation.

With several international airports, and the ability to travel overland by train to just about everywhere in Europe, the UK is virtually a central hub for visitors across the globe. It’s only natural that it would be the perfect place to pool the world’s talents. The key thing is that see that tech commerce flows well – in and out.

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