It was fantastic to see Jamie Hardesty concisely explain why we have to be very careful when throwing around statements like this:
As Jamie sensibly points out these numbers are compiled using outdated company categories to talk about industries that didn’t exist 10–15 years ago. The report quoted actually only refers to the ‘Digital’ sector (as designated by the UN Standard Industrial Classifications) in the NE which includes everything from computer programming to repairing phones, publishing to film & tv.
If we’re serious about encouraging the growth of high potential companies then we have to think more carefully about the language we use. What kind of companies are we really trying to create when we promote the ‘Tech’ sector, what are our strengths, and how can we play to them?
What I think most people really mean when they talk about ‘Tech’ are companies like Google, Facebook or Amazon. What they have in common is not that they are ‘digital’, but that they are built on innovation.
Technology is innovation, and Innovation-driven companies, whether they’re creating enterprise software or cancer diagnostic tests, are high potential companies that can grow from 10 to 100 people in a year, and from 100 to 1000 in only a couple more.
Obviously, these businesses are not easy to build, but when they are successful they create a legacy that can change the course of the future of a region. We’re talking about companies like Sage in the NE, ARM in Cambridge, or Dyson in the SW. Not only are they large employers, but they also provide an opportunity to build strong bridges between the universities and business, and inspire the next generation of founders.
2018 saw Ziylo, a Bristol-based startup run by 31-year-old Harry Destecroix, bought in a deal worth $800m, making it the biggest acquisition of 2018 in the UK (link).
What‘s exciting about this is that they weren’t another company writing software or the makers of 2018's most popular app. Ziylo were developing glucose binders that can be used to create ‘smart insulin’ products for the treatment of diabetes.
If this was a film then right now we’d zoom into a shot of a dictionary being opened to the definition of ‘Innovation’, and underneath it would be a picture of Ziylo.
So how can we talk about innovation-driven companies like Ziylo, Monzo or Skyscanner in a way that doesn’t include phone repair shops?
The current remit for Tech Nation is “To make the UK the best place to imagine, start and grow a digital business”. If we want to play to our strengths then I believe that this should include all innovation-based companies, regardless of whether they’re on the cutting edge of engineering, Biotech or Fintech.
Growing software companies in the UK will always be difficult when you’re going up against well-funded competitors in the US or China. What we can do though is out-innovate — developing new technologies, new medicines and new engineering solutions, where the competitive advantage is your IP rather than how much marketing budget you have.
So rather than worrying about which region has got the most phone repair shops let’s put our energy into supporting founders and creating companies that can have a real impact on the world, regardless of whether they’re writing code or arranging molecules.