Let me predict the outcome
Here's a sample of what's to come, unless the U.K angel investors read this and wise up fast -
Prime Minister David Cameron and Mayor of London Boris Johnson have unveiled plans to establish a £50 million "technical and creative institute" around the area dubbed the Silicon Roundabout at Old Street in London. The plans, set out at a conference organised by LSE Cities, propose an architecture-designed scheme housing 200 …
Quite enjoyed that when I first read it.
I'm all for starting the businesses of the future, but that's not what most of the startup scene seems to be about, it seems to be about a cycle of coming up with a derivative idea, hyping and pumping it until someone gives you some money, hyping and pumping it some more then trying to sell the company to someone so that the founders can make a successful exit, where 'successful' is measured solely by the size of the bags of cash. Meanwhile, basically none of them have effected any change AFAICT.
Let me also say that when I was a Londoner the areas 'Shoreditch' and 'Old Street' were to be avoided on account of being packed full of insufferable tw*ts.
Silicon Roundabout got going without any of these initiatives, sponsorships or political interference (some might argue, that's WHY it succeeded). To now have the government pitching in and hijacking the concept for it's own political ends is much more likely to bring about the demise of the area, rather than to help it.
There are only so may people with an entrepreneurial spirit - you can't make more of them just by flinging money or mentoring around. The best thing any government could do to help small businesses to start, grow and flourish is to reduce the regulatory overheads and keep the hell out of the way.
Shoreditch filled with tech startups because it was cheap. It was cheap because it was nasty.
The ongoing efforts to smarten the place up have caused rents to triple.
Throwing money at new startups just so they can afford the new rents is Bloody Stupid, and the next wave of en- and nontrepreneurs will simply go elsewhere.
When will it sink in that with hi-tech businesses you don't actually need to set up an expensive office in a place which means that your staff all end up spending half as much time commuting in hellish conditions as they actually spend in the office.
Spend the money helping businesses rent office space as and when needed in any of the thousands of existing serviced offices that already exist in London and around the country.
"Face to face conversations will never be outdated."
But people who think they won't, will be outdated.
We're talking technology startups here. What, precisely, do they need to "glad-hand" people for, if they're so good and capable of bringing in so much money to the area?
Every technology startup I know that was successful, the founders were geeks who wouldn't know what "meet in person" meant, and probably thought it was something to do with Skype video-calling. And they got successful by bypassing traditional business and doing things that everyone said was "impossible" and they wouldn't get any money for.
If you start a business somewhere which already has a decent number of businesses in the same sector, finding staff without requiring them to relocate becomes substantially easier. Also, if you're selling product to other businesses rather than consumers, proximity to the businesses you're selling to is a significant bonus (cos you can just pop next door for a meeting or support call).
Establishing a new business in a location that doesn't have these two benefits makes what is already a tricky task just that little bit more difficult, and it'll take a determined crew to make it work. Government funding has never managed to fix this; it just has to happen "organically".
Trouble with Berlin is the rents are skyrocketing, albeit from a relative low compared to London, and the existing residents are starting to get very vocal about the newcomers. The remaining cheap bits are not areas you want to go to - run down estates out on the Eastern end of the city with serious crime problems, particularly focused on "foreigners" (where foreign can even mean people born and bred in other parts of Berlin).
I was thinking north east mainly because I worked there for EDS. It has huge DWP and BT data centres. A plethora of young university types. As well as cheap housing and a Greggs on every corner. Cheaper booze and the mighty night owls presenter, the flashing blade himself - Alan Robson .
The chip factory in the North Eastcould have been a couple of possibilities (maybe there are others too)
1) a DRAM fab for Fujitsu, sited in Newton Aycliffe. It closed in 1998.
2) a DRAM fab for Siemens, sited on North Tyneside, opened 1997, closed (losing over 1000 jobs) in 1998.
If new startups are going to learn the most important aspect of running a business - the effective avoidance and evasion of Corporation Tax - then Silicon Roundabout is an excellent location from which to watch and learn.
Though personally I'd rather see the Silicon Roundabout types relocate in a proper offshore haven, preferably Rockall.
That's all you need. Fat pipes are the one thing they ain't going to provide, and the office space won't be cheap.
Digital industries don't need people to be physically congruous in a hub. The only reason for building a hub is for politicians to parachute in and boost their cool factor during election year. (Oh and possibly for Francis Maude to install his Savile-style casting couch)
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