The postcode EC1V – a hotspot for technology firms – saw 15,720 start-ups created over the 12-month period, outstripping some of London’s international financial centres by a considerable distance, according to a survey by UHY Hacker Young.
Canary Wharf and Bishopsgate combined saw 4,900 new ventures, less than a third of the total for Silicon Roundabout. Of the country’s 20 top areas for new firms, 17 are in London, with only Warrington and Cheshire outside of the south east of England. Brighton is also included in the list.
UHY Hacker Young partner Colin Jones said: “Clusters of expertise can be highly effective in driving new business creation”, adding “the area around Old Street has been an emerging business destination for some time thanks to relatively cheap rents, but since the internet and app industries started to colonise the area, new business creation has really taken off”.
Silicon Roundabout, also known as Tech City, appears to have profited from government efforts such as the Tech City Investment Organisation, a body aimed at encouraging growth in the area. Successful tech start-ups in the area include Hail-o-, the international taxi app; Mind Candy, responsible for Moshi Monsters; and Stylist Pick, the online fashion boutique.
However, a recent City A.M. roundtable discussion on the new issues market heard from Balderton Capital how many larger tech sector companies, like Shazam or King, were likely to head for share listings in New York rather than London.
Other top areas for new business in the capital included Borough and Bermondsey (SE1), where 5,190 new businesses were set up in the last year, mostly specialising in the creative industries, finance and professional services.
St. James’s (SW1Y) attracted 1,830 new businesses last year. Already a popular spot for private equity firms, it is also favoured by wealth management firms.
“The area is in easy reach of the City yet close to the homes of the growing community of ultra high net worth Individuals in locations like Mayfair, Knightsbridge and Notting Hill,” said UHY Hacker Young.
Bishopsgate and Canary Wharf (EC2, E14) became the new home of 4,900 new City-related businesses in the year. The sites have become popular with former City staff who have set up their own boutique operations and wanted established locations to enhance the credibility of their new businesses.
Meanwhile London-based and web businesses are also claiming the lion’s share of angel investment.
In a study of 262 angel deals worth £137m in the year to March, Deloitte and UK Business Angels Association (UKBAA) found 54 per cent of investment went to London and the south-east and half of capital went to digital and internet businesses.
Source: Jenny Forsyth, CityAM