Now that the Conservatives have gained another term in government it is likely that they will press ahead with many of their pledges. Of particular interest are the proposals set out in George Osborne’s recent Budget Plan for 2015.
The Chancellor of the Exchequer has offered a series of measures to support the technology sector, including:
- £11m in tech hubs in Manchester, Leeds and Sheffield
- £60m in energy research to develop energy technologies of the future
- Funding to develop a financial technology incubator in Leeds
He has also offered greater incentives such as tax breaks for video games makers, £100m for automotive groups working on driverless car technology and a £40m in investment into research into the “internet of things”.
In summary, the 2015 budget offers a substantial investment for the technology sector and a real opportunity for entrepreneurs and enterprises to gain a foothold in our increasingly profitable technology sector.
Where is the next tech city?
When it comes to commercialising your concepts there are a lot of factors that play into the overall success of an enterprise. One of them is being in the right place at the right time. So, a few things to look out for when assessing the market landscape are:
Location of Growth Opportunities:
A survey of the digital economy by Tech City UK has found that 74 per cent of companies and 85 per cent of workers are now located outside the capital. With rent prices increasing in London, the surge in competition and tight venture capital practices, the North sets to be a go-to destination for those who wish to keep costs low and take advantage of government investment. For those entrepreneurs in the FinTech sectors this is notable. With the industry growing from $4Bn in 2013 to $12Bn to 2014, you may want to consider nestling up in Leeds where a new FinTech incubator is on the cards as it may well become the hotbed for investors in the near future. For those who like the sea, consider Bournemouth and Liverpool which have already outstripped London in terms of growth while the Midlands is set to be home to new energy technology research hubs.
So far Greater Manchester, Belfast, Sheffield, inner London and South Wales are home to tech clusters. However, about 90% of all digital companies in the UK, which are mostly small and medium-sized, expect revenue growth this year. For would be investors and those looking to set up shop it is important that opportunities outside of London’s silicon roundabout should also be considered. .
Consolidating Market Position:
Depending on your business, operating from London might limit your opportunities as there will be increased competition or limited regional capacity. Branching out may help you consolidate your market position but could also help in minimising your competition in the long run.
Fortifying your domestic position by taking advantage of this significant investment may also have a positive effect on international opportunities. Currently, the Euro is very weak and given competitive prices and the rate of growth, this may attract a lot of foreign investment, which everyone should keep an eye out for.