Earlier this month there was a flurry of media comment (see below) marking the first anniversary of what has become known as “Silicon Roundabout” by locals but “Tech City” by the Government. It is a cluster of 600 hi-tech companies on the roads leading to the tube station and intersection of Old Street and City Road (just a 15 minute walk from our offices).
The idea of geographical clusters is well known – there is the motor industry in Detroit and the financial district in New York and, of course, The City of London. The West Coast of the United States has perhaps the best known technology cluster – Silicon Valley around San Francisco – as a result of the chip manufacturers there. Cambridge and Oxford Universities have their own mini-clusters where spin-offs are often around the biotech market. So it’s great that we have our own tech cluster in London.
The news reports show that there were only 200 tech companies in the Silicon Roundabout 12 months ago – so it is experiencing massive growth, which is encouraging when so much economic and employment news is rather dismal. Perhaps it’s location in the rather trendy and up-and-coming creative environment of Shoreditch/Hoxton – while still just a stone’s throw from all the business and financial resources of the City and the entertainment within the West End – is the driving factor.
But it is encouraging that the Government, big businesses, private finance and other enterprises have managed to mobilise support and encouragement for the area so quickly – there are already numerous on-line communities and resources (see below) emerging to support the people on the ground.
It has a personal attraction for me as my young daughter adores Moshi Monsters and their creator – Michael Acton Smith – moved from Battersea to Silicon Roundabout recently and he is tipped to become the roundabout’s first billionaire.
I asked some of our folks here at Royds what makes East London so attractive to tech companies:
“Small new companies need low cost office accommodation – often to a fairly high spec in terms of their cabling and communications requirements – but with the flexibility to take on additional space at relatively short notice. Large, institutional landlords with prime developments in the City and West End will typically try to lock more significant tenants into long and complex leases – smaller businesses will often be reliant on smaller landlords. There is a wealth of smaller, character buildings in the Shoreditch area which would suit their needs much better. Google is reported to be leasing a building to house small firms in the area and there’s even a business there that provides “hot desk” space that can be rented by the day”.
Robert Lloyd-Davies, Commercial Property Department
“Intellectual property protection is vital for new technology companies whose focus is on innovation. When you combine intellectual property law with fast changing technology law – where the pace is somewhat faster than other areas of business – these people will need easy access to the sort of expertise you are only likely to find in the leading law firms”.
Stephen Welfare, Intellectual Property Unit.
“The international angle is important – whilst most of the companies are British, many are funded by or have links with United States and Asian companies. In the technology sector, they face a global market place. English law and jurisdiction still remains one of the most popular options when negotiating agreements”.
Stewart Wilkinson, Dispute Resolution
“There were reports that over 50 executives came over from US companies to help the Tech City start ups – so a relatively straightforward work visa process helps. But also, a favourable and transparent personal taxation regime is important for small business investors, entrepreneurs, business owner-managers and potential high earners”.
Deanna Hurst, Private Client department
Recent media coverage: