Undoubtedly, the rise of the tech industry continues to grow. It is essential to the growth of the UK, and as we step into a new era of tech, these local ecosystems will continue to help businesses thrive.
Why does the tech ecosystem matter?
No man is an island, it takes a village to raise a child, and a similar can be said for the tech growth in the UK. Beauhurst and Barclays Digital Eagles reported that, while the local technology ecosystem is often overlooked, it has a critical role in providing the environment in which start-ups can grow. There are multiple parts of the tech ecosystem which are helping businesses scale up. From local government, investors, academic institutions, and business support services, they all have a role to play. And when they play together, the culture for growth intensifies.
Why do local ecosystems matter?
With so much focus on the national landscape, it is easy to lose the details of how tech start-ups thrive in order to see the bigger picture. Too often, focusing on geography can appear as a constraint. However, it is no coincidence that some high-growth tech companies keep appearing in the same locations.
Not just London
For a long time, London has been a hub for tech start-ups and is considered the place to be; however, more and more ecosystems are appearing.
Manchester has over 1200 tech companies which started and successfully grew. With the likes of Edinburgh and Leeds following suit, it appears that if the local components of a flourishing tech ecosystem work together, there continues to be positive growth within a tech start-up.
What components are in a tech ecosystem?
Beauhurst and Barclays Digital Eagles report breaks the ecosystem into three areas.
Investors
Innovation requires capital. There can be multiple funding options within the area. Venture capital investors often consider early-stage business opportunities for strategic investments. Grant and funding options from local governments and bodies are available for several initiatives. There are also funding options from university or non-profit-backed programmes that can help scale up tech businesses within local ecosystems. Some start-ups may also look to public crowd surfing as an option to gain funding and support for their business.
Support
There can be many different support networks available to start-ups. Spinouts often receive support from their university or academic institute. This support can be financial but comes in the forms of access to workspace tools, knowledge-sharing and extended support.
Outside of spinout support, there are also accelerator programmes designed to help businesses grow and develop, or incubators which, instead of focusing on the company's acceleration, help build and refine the innovation of the business over an extended period.
Local government interactions
There are often local government set-ups to help businesses grow and scale. For example, Local Enterprise Partnerships is an initiative which helps develop businesses through community events, funding and support programmes. Growth hubs can support business and funding strategies and advice on growth from hiring and apprenticeship opportunities to enable growth.
There are many benefits to the tech ecosystems. Accessing the different areas of the ecosystem increases the chance of high-growth success. New businesses with an engaged network have a better chance of success and growth. When a new company has the opportunity to grow, it benefits the economy and helps with economic development at the regional and national levels. Businesses who grow will put money back into the economy through partnerships, and local use of space, for example, office space, when companies continue to grow. When growth happens, it also enables increased employment opportunities in the area. As businesses grow, they offer more local employment and skills development opportunities.
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