While the effects of the economic downturn are still felt in many sectors, it could certainly be argued that the UK’s tech industry is one which is faring rather well by comparison, including for start-ups.
With yesterday’s Budget claiming a boost to small business as a way of helping the nation, as a whole, climb out from a biting recession – accompanied with burgeoning plans for a ‘tech city’ in east London as an answer to America’s Silicon Valley – there is in fact a lot to be optimistic about for small to medium businesses hoping to make the leap up the ladder.
And this is all part of the overarching aim of a partly government-funded initiative which has been running for three years now, seeking to help innovative British companies succeed on a large, international scale.
For the past few years a number of promising web technology companies have been invited to travel to Silicon Valley and San Francisco as part of the Web Mission to drum up financial support and develop business partnerships with some big names in the field such as Twitter.
And this March another set of the UK’s best growing companies set out to meet with industry leaders, investors and potential business partners as part of a scheme sponsored by the Technology Strategy Board and UK Trade & Investment (UKTI).
This includes ParcelGenie.com, a service which allows users to send real gifts on social networks without a shipping address, CloudApps, a cloud platform aimed environmental compliance and energy management, BraveNewTalent, an online recruiter that uses social media to build communities of potential employees and employers, and Brainient, a start-up that gives advertising clients the ability to easily create interactive videos.
In financial terms there are definite incentives for the firms chosen to head across the pond, with David Bott, Director of Innovation Programmes at the Technology Strategy Board informing TechEye that so far $100 million has been invested in firms involved, not counting any deals yet to be made this year.
But Bott believes that the benefits of the scheme span further than immediate investment gains, with the access expertise from the UK firms’ encounters proving invaluable.
“The original Web Mission was designed purely to get investment, however it quickly became clear that other benefits were there to be had from the firms in the US,” he told TechEye.
“The UK firms are able to see what it is like to be a business operator in Silicon Valley and how it works as a big business in the US which is an invaluable experience for smaller UK firms who want to go global.
“It gives the possibility to meet competitors and collaborators and vitally establish business links.
“Of course there is also the investment opportunity, and there has been roughly $100 million worth so far over the last three Web Missions, no small amount, though it is too early to say what has gone on during the most recent trip.”
Certainly the trip brings benefits for both sides, with US investors able to select from some of the brightest UK firms specialising in web technology.
“By bringing these companies to the Bay Area and Silicon Valley, there is an opportunity to learn from colleagues while also offering US companies the opportunity to partner with the growing UK technology arena,” Bott added.
“For the US venture capitalist, the benefit is that they get the pick of the UK small business talent, as only 20 go across, meaning that they are essentially exposed to a condensed version of the best in UK tech firms.”
But it is the UK firms which probably have the most to gain from the expedition by being exposed to giants of the tech industry, such as Saleforce and Twitter, which dwarf many achievements of UK industry.
However Bott also believes that there is increasing support for tech business in the UK, with initiative such as the “East London Tech City” helping create an infrastructure that breeds success.
“There are a number of exciting companies involved from the Shoreditch area and this is a sign of the talent in the tech city already.
“We already have an environment where the older firms are able to help the growing companies, but we also want to help the community help itself rather than smothering it with kindness,” he says – in reference to the aim of supporting businesses to grow themselves by introducing them to international markets.
And the firms involved this year have snapped up the opportunity offered by Web Mission 2011 with nearly all now seeking funding from venture capitalists that they met on the trip, as well as all apparently planning expansion into the States in the next year.
Furthermore, in terms of finding business partners, a large number also found partners either from the US or through other Mission delegates, and a small number are now working on making products available in the US over the next three months.
Speaking to TechEye, one of the delegates on the trip, Brainient CEO Emi Gal, said how important it is for UK firms to gain access to Silicon Valley VCs and companies.
“The trip was the perfect combination of scheduled meetings and relaxed socialising environment where we were able to meet with the people in the Valley,” he said.
While it may sound perhaps slightly out of the norm for a CEO to focus on the parties, Gal said this is an integral part of the difference in attitude that exists not only across the Atlantic, but also from East to West coast in the US.
“People there are different from London and New York, the attitude there is much more laid back,” he says.
“In Europe particularly there is much more of a hierarchy and atmosphere in which people are less willing to learn or to share knowledge.
“This is certainly not the case in the Valley where people are not too serious.”
Gal believes that it is this attitude that has bred an emphasis on building a product that can “make a change, rather than make money”.
Of course he quickly points out that this attitude goes hand in hand with creating some of the biggest web firms in the world.
And it is from these companies which he was able to meet, spending time with Twitter, Saleforce and Bebo’s Michael Birch, that Gal believes the UK can learn from.
“There is a lot to learn from big companies as they have been through all the problems that you can imagine, and have succeeded.
“But the UK is starting to get there,” he adds.
“With, for example, the Tech Hub in East London, entrepreneurs are beginning to get more opportunity to talk and establish good links with other.
“Overall the government does a lot to support small businesses in England, what needs to continue improving is the culture and attitude of sharing information and learning.”
While it appears that the UK still has a lot to learn from Silicon Valley in terms of creating avenues of success for its innovative businesses, the opportunities offered by initiatives such as Web Mission and the tech city mean that the doors are increasingly open to companies such as Brainent.