Watch out America, the Brits are coming (hopefully)!
Advertising tech platform CEO Irfon Watkins on how the UK’s tech business ecosystem can be a platform for success in America
The UK tech industry is going great guns. The sector recorded the best growth performance for almost a decade in the last quarter of 2013, the fastest improvement in profitability in six years and a continued solid rate of tech sector job creation, according to research by KPMG.
Ex New York City Mayor Michael Bloomberg was even quoted last year as saying he spends more time eyeing London than he does Silicon Valley in the battle to be the champion city for the tech industry.
Creating billion dollar businesses
And it’s not just the UK’s capital that’s booming. Cambridge is home to more than 1,500 tech companies, 12 of which have achieved $1bn valuations in the last 15 years.
Digital content and information communication technology (ICT) industries account for around 45,000 jobs in Greater Manchester, generating around £2bn annually in economic output, and Newcastle, Brighton and Bristol all have established tech clusters.
I proudly count myself as part of this trend. For the last two years I’ve been building Coull, a video advertising technology company in Bristol. We ourselves enjoyed a 500% increase in revenue between Q4 2013 – Q1 2014.
Growing angel investment environment
Our route to where we are now has been very different to what might be accepted as the norm. With early-stage start-ups often looking to go down the institutional funding route, what’s often overlooked is the extremely healthy environment for angel investment in the UK.
With a tax-efficient economy and a wealth of entrepreneurs and successful business people ready to invest, the UK’s Enterprise Investment Scheme (EIS) is an excellent route to finance.
And the benefits of angel investment go beyond the financial. You get access to mentoring from people who have often grown a business from scratch and possess a long-term view that can sometimes be lacking when dealing with institutional funding. We’ve seen this ourselves as to date we have raised $12.2m, solely from angel investment.
This approach has worked well for us. We have achieved 90% staff growth since our launch two years ago and have expanded from two offices to four, across both the UK and the United States. Our aim is to build a billion-dollar technology business from Bristol city centre.
Emulating America, from here
I believe that once early-stage tech businesses realise they have options when it comes to accessing finance and that the infrastructure is there, they can stop worrying about whether they’re set up in an enterprise zone or ‘techhub’, and get on with what matters most: building and scaling their product.
With the UK tech scene as vibrant as it is now, and a growing recognition that start-ups here can emulate the global successes of their Silicon Valley counterparts without having to replicate the unique environment they grew from, perhaps it’s time for businesses on both sides of the Atlantic to start learning from each other.
60% of our business now comes from Stateside. With the launch of our New York office, we will be taking British business practices to the US – employee holiday allowances in line with Europe for one – and bringing a wealth of learnings home too.
One thing’s for sure, the opportunity for UK tech start-ups to bring their ideas to life on a global scale has never been greater.
Irfon Watkins is the founder and CEO of Bristol-based video advertising technology start-up Coull, which has offices in London and Santa Barbara, US. www.coull.com