If the name Faisal Butt doesn’t ring any bells, it should. The founder of London-based proptech incubator Pi Labs and venture capital boutique firm Spire Ventures has had a personal hand in disrupting London’s property landscape.
Getting more tech entrepreneurship in the capital, he says, requires just two things: focused accelerators and venture capital platforms. Butt points out that the deep-dive approach taken by Pi Labs (which has been first investor in 24 proptech companies so far – and plans to invest in another 15 this year) is now being emulated in other areas, such as fintech and retailtech.
He says: “In my view, focused investors are more likely to make better-informed decisions when selecting investments, and their depth of experience and their networks allow them to add more value post-investment. This focus can have a transformational impact on start-ups, and the presence of these sector-focused platforms will play a key role in establishing London’s position as a global tech hub that must be reckoned with.”
Butt thinks that the main force behind sector-based accelerators and platforms in the capital will be partnerships between entrepreneurs and venture capitalists – though he suggests that the movement could be fast-tracked by public-sector intervention.
He says: “We have seen that, for mid-size funds, government match-funding schemes are available, but there is a gap in the market for small and first-time funds. Helping first-time sector-focused funds get started could be a catalyst for change in sectors that haven’t yet seen much digital innovation, cementing London’s position as a global tech hub.”
What do other members of the London Forum think?
Tomàš Jurdàk, chief executive, HB Reavis UK
There are three basic ways for London to generate even greater tech entrepreneurship: encouraging access to capital for tech start-ups, ensuring freedom of movement and providing the right working environments.
The need to ensure access to capital is self-explanatory. As for talent, London’s tech sector’s strength lies in its ability to act as a magnet for the world’s very best. In order to maintain this, London should be able to set its own immigration rules. There are clear precedents for this – such as in Canada, where individual provinces draft in skilled migrants to match the particular needs of local industries.
In order to retain its allure for tech businesses – and particularly start-ups – London should continue adding affordable and flexible workspaces.
Amelia Saberwal, workplace innovations leader, Woods Baggot
London currently finds itself in a tricky position. Winning over tech entrepreneurs, who are growing increasingly attracted to Berlin and Amsterdam, will be the city’s biggest test. Promoting a true 24-hour economy, boosting both economic and new-age collaborative opportunities, is one way forward. Most workspaces stand empty between 6pm and 8am, making places such as the City and Canary Wharf ghost towns out of hours. Tech talent is known for working unconventional hours; corporate businesses should consider a mutually beneficial offer – giving a portion of office over to out-of-hours techies either at discounted rent or in return for new insights and networking opportunities from the fresh blood walking through their doors. This partnership could stretch to intermittent pitches for funding, with the aim of extending their stay if they receive investment.
Nick Belsten, director, Indigo Planning
Collaboration between higher education institutions and the business community will play a key role in ensuring London can better accommodate the rich intellectual resources – the tech talent in particular – that it nurtures but finds hard to maintain. London is failing to tap into the full potential of the talent that passes through it every year on study visas. To ensure London remains competitive, we must act quickly to solidify our stance on immigration post-Brexit – introducing a London visa would be one way of ensuring we are doing all we can to encourage entrepreneurs to stay in London.
Bill Page, business space research manager, LGIM Real Assets
Clustering matters. The more firms per worker there are in an area, the better subsequent jobs growth tends to be. The same is true of entrepreneurship: the more start-ups and failures there are, the more jobs tend to be created over the longer term. In free markets, success leads to expense and this can choke growth. In London the edgier areas beloved by tech companies are becoming core, and while the co-working movement has supplied creative and serendipitous space that fosters interaction – to the benefit of the sector – such options are expensive. Steady economic growth is the common denominator for continued success.
John Slade, chief executive, BNP Paribas Real Estate
Urbanisation and digitisation are key trends that will dictate London’s future. It is essential, therefore, to get digital skills and training right and to make the capital the destination of choice for tech entrepreneurs from across the globe. To do this we must ensure our tax system creates the right incentives, we must meet London’s housing and infrastructure challenges, and we must ensure that entrepreneurs can easily live and work here. Maintaining London’s status as a leading smart city is also vital. Smart cities attract smart people – they are where the innovators want to live.
John Dickie, director of strategy and policy, London First
The tech community in London and the South East has critical mass; our challenge is to keep it growing through Brexit. Funding will be a key area. EU programmes such as Horizon 2020 and the European Investment Fund are particularly important to the sector and need to be replaced with UK government funding, ideally devolved to London government.
