You would be hard pressed to find a sector more dynamic and innovative than tech. Over the past 12 months, waves of innovative new companies in the UK have created exciting new products to help change the way consumers and businesses are able to manage their daily activities. What’s more, we’re only scratching the surface.
With almost 200,000 tech companies in London alone – supporting a combined turnover of a staggering £285bn – there’s plenty of room for newcomers looking to fuel disruption in the UK and launch a successful business. And most encouragingly, plenty of support is available for those looking to take this important first step or grow their existing brand in the coming year.
How did UK tech startups fare in 2018?
According to Tech Nation’s 2018 report, tech is expanding a remarkable 2.6 times faster than the rest of UK economy. This is complimented by strong Venture Capitalist appetite, which has fuelled growth and helped the UK say on top as Europe’s prime investment destination for tech in 2018.
The UK tech sector is clearly thriving – and despite some immediate concerns about what a future outside of the European Union will look like for entrepreneurs – the hunger for growth and innovation is palpable. Much of this comes down to the wealth of exciting opportunities and partnerships to be found, particularly within London’s renowned Tech City.
One of the reasons why the UK is a leading destination for startups is due to its strong support structure. From alternative finance, crowdfunding platforms and schemes such as EIS (the Enterprise Investment Scheme), through to accelerator programmes and tech hubs, there’s no shortage of encouragement to help early stage businesses get off the ground and reach their potential.
Unfortunately, despite this inspiring climate, many of those harbouring entrepreneurial ambitions have been held back by fears of the unknown. Research conducted by Studio Graphene in the summer of 2018 revealed that while over a quarter (26%) of UK adults have ambitions to start their own business (for millennials, this jumps to a massive 45%), 46% feel they lack the skills and knowledge to be a successful entrepreneur.
A lack of awareness and education is clearly an obstacle which is holding many prospective entrepreneurs back from taking the plunge. Looking to the coming 12 months, there is an evident need for more to be done to encourage our next generation of entrepreneurs. Launching a startup has never been easy, which is why people should be taking advantage of the opportunities offer.
What can we expect in the new year?
In light of the UK’s expected departure from the EU in March 2019, Brexit will no doubt continue to dominate the public agenda and political discourse – particularly over the course of the first few months of the year.
Businesses large and small are already undertaking the necessary preparations to prepare for whatever eventual outcome this important political and economic transition will bring. Perhaps most importantly, tech startups and SMEs will need to consider carefully what impact restrictions on the freedom of movement could have on their access to talent; for, one of the greatest obstacles facing the sector is in fact sourcing the right talent.
This became clear through a separate survey conducted by Studio Graphene in 2018, which unveiled that one in three (33%) founders felt there was a shortage of digitally skilled workers in the capital, while 35% had found it difficult to lure talent away from larger companies.
The difficulty of finding employees with the rights skills and mindset is an evident challenge facing early stage tech firms. Luckily, there are plenty of solutions to this problem, not least of which is the creation of dedicated training programmes, apprenticeships or incentives designed to attract and/or train skilled workers.
Another promising option for fledgling and scaling startups is to consider outsourcing certain aspects of the business, such as the technical and digital sides. There are plenty of experts and agencies that can offer a helping hand to those lacking the technical know-how; freeing up time and resources that could be squandered on keeping everything in-house.
The past year has been largely overshadowed by the ongoing Brexit negotiations, but this certainly hadn’t dampened the UK’s entrepreneurial spirit. And while the Brexit saga continues into the new year, 2019 is likely to be an exciting year for tech given the country’s proven track record for innovation and resilience.