The UK economy would benefit from more growing businesses located beyond London.
East London. The Silicon Roundabout. You’d be forgiven for thinking everything outside the big smoke is a wasteland. But startups don’t seem to think that way - they’re actively shunning the tech hotspot, with three of every five high-growth small businesses now located outside London and the south-east.
That’s an extraordinary number, especially with the extra focus thrust upon the capital given what’s happened in the UK since the EU referendum.
I saw something important happen last month. And it didn’t happen inside the M25. I know. It’s a shocker. But, as I just mentioned, there’s a lot going on outside London.
On a sunny May weekend, I spent some money in Southampton. Quite a bit of money. Not on something silly, like a car or seventies figurines still in their boxes.
I spent some money on the future.
The University of Southampton was hosting an event in its Future Worlds startup incubator. It was a Dragons’ Den-style affair, where uni students pitch business ideas to a panel of business professionals.
I was there, as was Chris Broad, Apple Director of Sales Contracting EMEIA; Andrew Doe, serial digital entrepreneur and founder of confetti.co.uk; and Sonja Lami, angel investor and Insight Investment fund manager.
Granted, we weren’t as scary as Duncan Bannatyne - who is? - but we got the job done. Alongside Sonja and Andrew, I invested in Questioneer: a startup created by two first-year computer science students, it provides an interactive bank of mathematics past papers, offering infinite questions and feedback.
It’s going to change the way GCSE and A-level students revise, and if all goes well, its formal launch will go ahead in time for the new school year in September. There’s also scope to expand this method of learning into many other subjects, including the Sciences.
This is something that’s going to completely alter how kids learn, how the next generation of mathematicians, scientists, bankers, businessmen and more operate. These first-year students, these entrepreneurs, came up with the Questioneer platform. They thought of that - not some established, well-off technology agency in London.
This is by no means a cuss to London.
London is an incredible city rife with opportunity. But businesses and investors need to utilise the endless talent floating around outside the M25. And not just by way of tokenism, not just giving something a name *cough* Northern Powerhouse *cough* and leaving it to die.
Because Brexit is going to happen. Unless the government backtracks on everything it’s said in the past two years - which, depending on who you talk to, is possible! - then we’re leaving the European Union.
And London will probably be fine. Because it’s London. When people think of the UK, they think of red post boxes, corgis and the tube. They don’t think of Southampton.
One particularly frustrating thing about Brexit is, at the moment, we still don’t really know how it’s going to pan out. We don’t know the impact it’s going to have on small businesses, whether or not it’s going to crush the UK economy save for the big players.
Businesses need to be ready. Again, household names will probably be fine. But for startups and prospective businesses, things need to get off the ground now.
Those with the money need to branch out and invest in the UK. The ideas and the talent’s there in spades, but those outside of London might not have the same opportunities, the same funding, the same exposure. The regions often suffer due to the perception that all the top jobs are in London.
So the people funding the top jobs need to change this. They need to invest. Creativity runs through the UK’s veins, but it’s not going to get where it needs to be without proper support. It needs funding on a grassroots level. It needs more events like Future Worlds, where the innovators of tomorrow get support today.
I believe in this because it’s a fact. It’s how our business was founded. In an office in Southampton above a dry cleaners. Someone believed in our founder in 1979. They invested in him, his passion and his talent.
We’re still fiercely independent, proud of our roots; but we’re starting new businesses, growing and operating here, the US and Australia. It can be done. Our success is replicated across the regions by other super-talented people.
To all the startups and budding entrepreneurs outside of London: don’t stop trying. If you have a concept that’s unique, if you have a business model that’s workable, then you deserve to get off the ground. You deserve to launch your product or service into a global market, competing with London startups.
Pitch to people in London. Don’t be restrained by your local economy. If enough great ideas are coming from outside the capital, then there’s going to be a change. Enough startups are now setting up shop in other areas.
London doesn’t have to be the start and end of business - the economy will benefit from a broader spread of startups and scaleups across the UK. An actual United Kingdom.
Nick Lawton is CEO at launch specialist agency Five by Five.
Why Innovation Outside The M25 Is Key To The UK's Future