How London has become the place for tech startups

The number of new tech companies launched in the UK rose 14 per cent in 2018. In our recent research looking at the Northern Powerhouse, we found that 45% of IT decision makers would choose London to launch their tech startup. Similarly, a 65% majority of IT DMs report that London is where the best IT and technology talent is in the UK.

So, what makes London THE place for tech startups?

London offers good university technology courses

Our research found that 43% of IT DMs say London has better tech-focused educational institutions than other cities the UK. We’ve previously written about the best UK universities for technology courses, and fittingly, Imperial College London was one of our top picks.

Many graduates from the university’s tech courses go on to secure one of the city’s 300,000 tech jobs, working in a variety of roles in software or entrepreneurship. London’s ability to provide good tech education means that startups can find skilled, qualified staff. The city also provides the opportunity for entrepreneurs to upskill and continually develop their knowledge.

The city attracts a large number of developers

StackOverflow’s London Edition of the 2016 Developer Ecosystem Report states that there are over 300,000 developers in London, compared to 130,000 in Paris and 80,000 in Berlin.

There are also more developers in Greater London than in New York and San Francisco. And According to Balderton Capital’s European Tech Landscape Report, developers in the UK are the fourth highest paid in Europe with an average salary of £55,000.

With such a high concentration of developers in one place, tech startups in London have access to some of the best programmers in the world.

An abundance of co-working spaces and tech incubators

Kandidate’s London Startup Guide 2018 reports that there are over 156 co-working spaces and over 70 startup incubators and accelerators in London. The city is also home to Level 39, Europe’s largest FinTech incubator.

According to commercial property consultants Cushman & Wakefield’s 2018 Co-Working Report, London is the global capital of coworking, with more providers than New York. Since 2012, flexible workplace leasing in London has represented an average of 10.6% of the property market, compared with 2.9% in Manhattan.

With the demand for flexible workspace in Central London doubling from 853,178 sq. ft in 2016, to 2,484,000 sq. ft in 2017, the report also predicts that coworking spaces could become ‘a fixture of high streets across the UK’.

An abundance of coworking spaces in London provides tech startups with a flexible, lean way to grow in the early stages of development.

London is home to billion-dollar unicorns

Known as the Startup Capital of Europe, London has an impressive number of billion-dollar startups or unicorns. Inspired by the success of these companies, many entrepreneurs see London as the first-choice city to grow a thriving startup business.

London-based BenevolentAI, which uses Artificial Intelligence to enhance scientific innovation was founded in 2013 and is already valued at $2 billion after its latest funding round this year.

Similarly, London technology company Deliveroo was established in 2013 and is also valued at £2 billion after it raised $482 million through venture funding last year. The startup is also now in talks with Uber regarding a possible acquisition.

London is also home to the money transfer startup Transferwise, which was founded in 2011 and is now worth $1.6 billion.

With a strong track record of producing billion-dollar startups, London is often seen as a city where new businesses are likely to succeed.

Networking and learning events

With an impressive number of networking and learning events in the city, there’s always an opportunity for startups to grow.

Silicon Drinkabout is a global weekly meetup for people in the tech industry that’s particularly popular in London. The event is run by volunteers with the aim of bringing people together face-to-face to create relationships and provide support for those in the tech industry.

There’s also Big Data London, which is a free conference and exhibition where people from the tech industry share and discuss ideas with other members of the data community. Its 2018 event had 130 expert speakers, 100 exhibitors and 8 theatres.

London Tech Week is a week-long festival of tech and innovation that explores how technology can have a positive impact in society and business. The event is attended by over 55,000 people who enjoy hundreds of crowd-sourced events across the city.

For an additional insight into London’s startup ecosystem, take a look at this short video from Ympact: