When people think of tech, the first place that comes to mind is Silicon Valley. These two concepts have gone hand-in-hand for decades and will continue as such well into the future.
However, it doesn’t mean that other cities around the globe won’t eventually catch up to the globally-renowned tech hub at some point or another.
London is one of those cities making waves in the tech industry and looking to outshine Silicon Valley.
Though it has a long way to go, London has experienced unprecedented growth in areas that include the number of new startups launched, investment money raised, as well as the number of big tech corporations getting involved.
According to a 2018 report released by Tech Nation, the United Kingdom’s tech scene has expanded nearly three times faster than the rest of the nation’s economy, with London having the highest concentration of growth.
Towards the end of 2018, the tech industry was worth £184 billion, up from £170 billion a little over three years ago.
How the UK’s Tech Scene Is Flying High Above the Storm
Historically, London is as a city of creative innovations in the sciences and arts. However, within the past two to three decades, it has gained a reputation as being a city of invention and innovation.
Additionally, London has long been influenced by a culture that approaches investment and entrepreneurship more conservatively. Londoners aren’t ones to easily allow for failure as those in the United States.
If one wishes to be successful in the tech industry, they will deal with numerous failures before a win. Americans accept this fact and are far more forgiving of those who take risks and fail. Hence, Silicon Valley flourished and is still a global leader in the world of tech.
The Big Bang led to a quick and sudden expansion of the financial and professional services sector, killing most people’s entrepreneurial mindset. For many, job security far outweighed the risks associated with being an entrepreneur.
However, over the last decade, the United Kingdom has seen people’s entrepreneurial zeal rejuvenated due to various factors, one being a post-Lehman’s environment where job security went down the tube. The influx of highly skilled migrants to London also played a role in the city’s entrepreneurial Renaissance.
Interest in Tech Continues to Mount in the UK
In 2018, evidence that attitudes towards innovative entrepreneurship came in the form of £800 million invested in London-based fintech startups. London’s fintech scene is paving the way for change to occur within the financial sector.
Companies now feel more comfortable taking innovative approaches to how banks and other financial institutions view their archaic business model.
The government has even started pitching in to drive the growing tech industry forward with programs like the Seed Enterprise Investment Scheme (SEIS). According to Metric Accountants, a fintech startup itself, SEIS is “designed to incentivise potential.”
Monzo Bank Ltd, a digital, mobile-only bank, is an excellent example of how fintech is reshaping the banking industry. It has over one million customers, recently hitting “unicorn” status even though it launched four years ago in 2015.
Monzo continues to enjoy rapid growth as consumers are looking to replace traditional banking with services that are more accessible and convenient.
According to London & Partners, London has the right amount of financial clout and investment is abundantly available.
The site also stated: “Venture capital investment into Britain’s technology sector has reached a record high with London-based companies securing around 75 per cent of the $2.2 billion raised by U.K. firms since the beginning of this year.”