Tech City (the organisation as opposed to the trendy part of East London) is in something of a transition.
Prime Minister David Cameron set up the Tech City Investment Organisation (TCIO) in November 2010 to turbocharge the already thriving startup scene in a small corner of East London. Today, the publicly-funded agency, which costs the taxpayer several million pounds every year, is called Tech City UK and has responsibility for supporting and growing the tech sector across England, Scotland, Wales, and Northern Ireland.
“We’re in a dialogue at the moment about the next iteration of Tech City and thinking about what the next step should be,” said Ed Vaizey, Minister of State for Culture and the Digital Economy, during an exclusive interview with Business Insider. “Tech City has ambitions not just to do much more within the UK but also to do much more for tech across the globe.”
The quango, which has undoubtedly helped to raise the profile of the overall London tech scene, has received its fair share of criticism since it was created.
Companies that Tech City UK was out to support in 2014 said they weren’t benefiting from the organisation’s programmes, with enterprise software firm Huddle going as far as to say Tech City UK is no longer needed during an interview with Business Insider in October 2015.
Tech City UK also has a questionable track record when it comes to giving out immigration visas to talented technology workers outside the EU, having handed out just seven of a possible 200 between 2014 and 2015. These numbers have since been improved upon but there’s still work to be done.
Vaizey added: “There are two or three big issues that we really need to look at for Tech City to see how it can be maximised,” without specifying exactly what the issues are.
Tech City UK needs to be kept “nimble and flexible” as it expands its footprint, Vaizey said. “You don’t want to turn it into a bureaucratic government agency that takes ages to make decisions.”
Following the interview with Vaizey, a DCMS spokesman added: “The government’s ambition is for the UK to be the default place for entrepreneurs to start new digital businesses.
“We will publish a Digital Strategy later this year to set out how we intend to unlock further growth and productivity in the digital economy, including how we will continue to support and champion the tech sector.”
Business Insider understands that the Digital Strategy could be released as early as June.
A Northern satellite
In an attempt to support tech companies across the nation, Tech City UK — funded by The Department for Culture, Media and Sport (DCMS) — set up a satellite operation in the North of England called Tech North.
Vaizey said Tech North was a way to send a statement saying: “‘We’ve still got Tech City,’ and ‘oh, by the way, it’s UK- wide.'” He added: “You don’t necessarily get the message across unless you set up Tech North. It was the first kind of proper HQ outside of London. So while Tech City does engage with the whole of the UK and identify clusters, Tech North was the first physical outpost.”
Tech North — described by Vaizey as a political creation led by former Deputy Prime Minister Nick Clegg as part of the government’s “northern powerhouse” agenda — received £2.2 million in government funding last year, while Tech City received around £2.1 million. Tech North’s aim is to join up the digital clusters across Liverpool, Manchester, Leeds, Sheffield, and Newcastle into one giant Northern England Silicon Valley.
Despite being unveiled in October 2014, and a planned launch of April 2015, Tech North did not launch until last September and it was criticised by Labour MP Chukka Umunna for a lack of early output.
Claire Braithwaite was appointed as Tech North CEO last year but she stepped down just six months into the role, with a report saying there was tension between Tech City UK and Tech North.
Two weeks before, Alex Depledge, an entrepreneur that sold her on-demand cleaning company to German rival Helpling for a reported €32 million (£24 million), resigned from her position on the Tech North board. She told Tech City Insider: “It was a tough call for me as I believe passionately in the North, but I do not support the new strategy for it being imposed by Tech City.”
When asked about the possibility of giving Tech North more autonomy to do its own thing, Vaizey said: “I think it’s important we have a clear line of site in terms of who is responsible for Tech City as a whole. So, while we want Tech City to have a clear presence outside London and to work outside London, as well as around the world, I want it to be one organisation.”
Grech was not available for interview but a Tech City UK spokeswoman provided the following statement:
With Tech City UK’s fifth anniversary this year, we are continuing to work very closely with the government to build on our programmes and campaigns such as Tech Nation Visa Scheme, Upscale, the Digital Business Academy and Future Fifty to ensure the UK remains one of the best places in the world to start and grow a tech company.
As we look ahead, we will continue to support entrepreneurs in every way we can, while positioning the UK right at the forefront of the next revolutions in tech.
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