Opinion: London is not the Holy Grail for tech start-ups

By Simon Elliot

It was very interesting to read in a Sunday broadsheet recently about problems being experienced by start-up businesses in one of London’s celebrated tech start-up hubs.

Apparently, at Tech City, people working to establish technology-led businesses are working on copper wire or slower connections, or even using dongles, to get hooked up to the internet. It seems unbelievable, crazy even, for any business hub in this day and age, let alone one which is targeted at tech companies.

Tech City’s broadband problems highlight, what many of us in the know have long suspected, that London isn’t the Holy Grail for tech start-ups we were led to believe, and entrepreneurs may have more success starting their companies outside of the capital.

Here in the North East, we are blessed with a number of sites which help start-ups thrive on the vital web infrastructure they need and an economic environment which supports new business, through organisations such as the Entrepreneurs’ Forum.

Hi-tech hubs such as Digital City Middlesbrough, Net Park in Stockton, Software city and Evolve in Sunderland, The Toffee Factory in Newcastle and the soon to be launched Digital Quay in Gateshead are all working towards helping talent to thrive in the North.

And let’s not forget that, in large parts of the North East, companies don’t need a hub to have a fibre connection. Complementing the commercial roll-outs in the City, the work being done by the Go Digital Team at Newcastle City Council will mean that Newcastle will have Next Generation Access broadband available in 97% of premises by summer 2015.

Additionally, businesses which currently don’t have a good enough broadband connection can apply to Go Digital Newcastle for grant assistance worth up to £3,000 to cover off one-off installation costs.

The quality of technological infrastructure in these places is such that geography is simply not an issue (as much as people in our region know that being in the North East is a huge added bonus). Those who say that their business needs to be based in the capital are clearly not taking full advantage of what technology can offer; with a good broadband connection, you can sit in an office in Durham and have a video conference with colleagues, clients or suppliers in London, Dubai or even Beijing.

Also, for the particularly picky business boss, geography doesn’t even dictate your telephone area code these days, and I’m not just talking about having generic 0845, 0800 or 0300 numbers. A business person in the North East can have “office numbers” with Los Angeles, New York and Tokyo dialling codes which ring straight through to his or her mobile, wherever they are in the world, should they wish.

It certainly does make you wonder just how necessary it is to build a new train line that gets you from London to Birmingham 20 minutes quicker.

In the North East we already know the relative cost benefits of renting or owning property in the North East, the lower cost of living, the highly skilled and enthusiastic workforce, and the countryside, coastline, culture and people who are second to none.

So, when entrepreneurs are making that all important decision on where to start their business, lets get the message out there and turn the North South divide on its head.


Simon Elliot is Head of Public Sector Consultancy, at Sanderson Weatherall in Newcastle.