The next Tech City: Is East Kent a viable alternative for UK start-ups?
Following Level 39’s Grow For It event where East Kent was hailed as the next tech hub, we look into the business opportunities in the area…
“Whatever way you look at it: East Kent is an ideal home for business.” This was the key statement put forward by Kent County Council leader Paul Carter CBE at an event held in Canary Wharf’s Level 39 for its East Kent Grow for It initiative.
Looking to incentivise technology and digital entrepreneurs to either start-up or relocate to East Kent, the campaign has gained support from leading industry names such as angel investor Dale Murray CBE, Jude Ower of PlayMob and Microsoft cities and regions strategist Linda Chandler, who see the area becoming the next “destination for growth”.
But what does East Kent have to offer start-ups and growing businesses and how far is the area developing into an emerging tech cluster?
With 17,000 businesses currently located in East Kent, an alleged workforce of 306,000 and property prices said to be up to 80% lower than in Central London, tech start-ups looking for an affordable alternative to the capital are gradually moving into the area.
Low-cost office rental and shared workspace
According to Carter, property prices are not only lower than in London but 60% lower than in the wider South East, while salaries are claimed to be up to 20% cheaper.
Workspace and co-working opportunities, in common with East London’s tech scene, are widely available with a variety of creative and digital start-ups sharing office space across Folkestone (pictured), Canterbury and Margate.
Fruitworks for example, a “pioneering” co-working space in Canterbury founded by serial entrepreneur Liam Gooding offers hot desk space in its 2,000 sq ft warehouse in order to help support start-ups to develop and grow their ideas.
Alongside co-working, East Kent also houses the Discovery Park Enterprise Zone in Sandwich, a 220 acre site of offices and lab facilities for science development. Businesses that locate to the park before March 2015 can receive 100% discount on business rates of up to a maximum £55,000 per year for five years.
Charles Armstrong, self-proclaimed ‘social scientist’ and founder of East London co-working office The Trampery, suggests that over the last three years regions such as Canterbury and Ramsgate have been “integrating tech hotspots” and “businesses are starting to link to each other” but that the “network can be strengthened” by more tech start-ups moving to the area to collaborate.
Access to finance: Expansion East Kent Regional Growth Fund
Facilitated through the government’s Regional Growth Fund, Expansion East Kent offers interest free loans, with £35m available, to growing businesses who have the potential to create jobs in the area. Entrepreneurs looking to apply must be able to provide an element of private sector investment within the business proposal and must demonstrate the need for financial support as well as growth potential.
High Speed Rail: Connectivity between London and East Kent
A “unique blessing” to the area, as argued by Seven Hills co-founder Michael Hayman, East Kent’s high-speed train service HS1 is one of the key attractions in developing a start-up cluster in the region.
Since the opening of HS1 in 2009, businesses can travel from East Kent to the capital within an hour and can also get to France within 90 minutes using the Dover Ferry crossing or via Ashford International station, opening up wider commercial opportunities in Europe.
Hayman suggests that over the next five to six years, this link will play an “important part in mapping out the growth of East Kent as a tech cluster”.
East Kent could take years to develop into a prominent cluster to rival London, with Murray commenting it would take two to three years for a business to get off the ground, but with the council and prominent business leaders actively pushing to make it happen, the appeal of Tech City may be genuinely rivalled sooner than we think.
Competing with Tech City
However, the appeal of Tech City is still one which many entrepreneurs feel cannot be matched. Bertie Stephens, co-founder and chief executive of Tech City-based Flubit.com and member of the 2013 Young Gun alumni, argued in a Tech City Insider blog that whatever you call it; Old Street, N1, Tech City, Silicon Roundabout, it is “without a doubt the place to be if you wish to launch your start-up career.”
Weighing up the advantages of the Tech City area, Stephens asserted that with a prestigious location like that of East London, “you can attract top talent to come and work for you” and that if “you forget about Old Street, you may as well forget about your tech start-up.”
An area with an established network of start-ups, investors and tech hubs such as Google Campus, Level 39 and its ilk, a Tech City location for a technology business has become in some ways “more important than your business model”.
How far its reputation will change as East Kent develops into a start-up cluster will be an interesting process to watch.