When it comes to the subject of startups and medium sized businesses, their conditions can be dictated not just through their everyday activities but also from larger scale agreements and recognition. This week has demonstrated this to be the case as our great capital city London has received recognition as the central hub for growing digital businesses. Whilst this is not something which may be a huge surprise – it is nevertheless welcome news and a big endorsement of how important startups have become in the capital.
This week has also seen a historic state visit from the Chinese president Xi Jinping. Ordinarily this wouldn’t be something I would mention in this column – however this may well be an exception as a raft of new agreements between the UK and China could have potential trickle down effects and small firms could well take a slice of the pie.
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London best EU city for digital startups
- London is ranked top for both startups and the more upwardly mobile scale ups in a new recently published study.
- According to a new index launched by Nesta , London is currently the best city in Europe for digital entrepreneurs.
- Additionally London was also ranked the highest for investment, entrepreneurial culture and “knowledge spillovers”.
- On this announcement Stian Westlake, director of of policy and research and Nesta stated these figures show that london is best for “relatively new as well as growing digital companies, with availability of finance at both early – stage and later – stage, decent quality of talent and workforce.”
- Whilst no other English city featured in the top 10 of the index Oxford and Cambridge ranked in at 11th and 13th respectively.
Breakdown – This news is very unsurprising. When you take into account London’s booming tech sector, and bohemian startup culture, it is no shock that the capital comes out on top for both startups and larger scale ups. London’s well established Venture Capital industry, coupled with the increasing number of fintech and alternative finance providers, demonstrate exactly why London is so far on top when it comes to having a true culture of entrepreneurism.
However, as people who live in the capital will know full well, London certainly isn’t cheap. According to the index “London is a victim of its own success: attracting talent from the rest of the UK and overseas has pushed up housing and office rentalcosts”. The fact that other big cities such as Manchester and Birmingham aren’t even in the index illustrates a large disparity between London and the rest of the UK – something which yours truly feels is unhealthy. So despite the enormous success story surrounding London’s tech scene, aided by the silicon roundabout, wider cost issues are things that need to be addressed to ensure that this continues and that talent isn’t priced out of the capital.
Historic state visit from Chinese president could present fantastic opportunities
- This week has seen Chinese President Xi Jinping make a state visit to the UK.
- The visit comes as the UK seeks to create greater ties with China and become its biggest partner in the west.
- On the back off this visit a number of deals have been announced which will see China invest around £30bn into the UK economy.
- According to Downing Street these various trade and investment deals will create almost 4,000 jobs in the UK.
- China will invest heavily into George Osborne’s Northern Powerhouse scheme – whilst the retail market is expected to benefit from £1 billion worth in export deals.
- According to a recent report in the Daily Telegraph Other deals include £2bn worth of electric buses; £5.4bn in a new nuclear power plant and even a £25 million deal to distribute Chinese TV to UK audiences.
Breakdown – How this would trickle down, and directly help small businesses, is probably unclear at this point. However, the general large scale investment in various british industries can only be good news for the economy. Direct investment into infrastructure such as transport, media and nuclear power is not to be taken lightly.
In short these things matter and there is potential for this to have a trickle down effect on the UK as a whole. So whilst it may not be apparent as to how this bilateral deal affects smaller firms that doesn’t mean that in the long term this won’t yield great results.
In other news… Good news for startups involved in educational technology: Promotional agency London and Partners have announced the launch of a brand new body to encourage the growth of this sector. The body – aptly called Edtech UK – aims to accelerate the growth of education technology in the UK.
We hope that you enjoyed this week’s edition of The Week in Startups. If you would like to read previous issues see here for more information.