Manchester鈥檚 growing reputation for technology was the subject of a roundtable of business experts. Jonathan Symcox reports.
The Industrial Revolution put Manchester on the map, but it is the industries of the future that could now be key to its prosperity.
Technology has been put at the heart of the region鈥檚 future plans, something which was boosted by George Osborne鈥檚 decision in his 2015 Budget to allocate 拢4m for a digital business incubator in Manchester.
Manchester City Council held an open meeting in April to discuss Project Forward as it looks to find a partner to help deliver around 70,000 sq ft of tech space in the city centre.
Project Forward has endured a chequered history but there鈥檚 no doubt that something positive is going on in Manchester.
UKFast鈥檚 CEO and co-founder Lawrence Jones has been tasked by the city council鈥檚 chief executive Sir Howard Bernstein to come up with a technology strategy for Manchester.
鈥淚 believe that we can create a new Silicon Valley,鈥� he says. 鈥淚t is already happening. There is talent in Manchester.
鈥淢y focus is to try and help Manchester become the number one tech city of Britain 鈥� and beat London.鈥�
The entrepreneur was speaking at a roundtable of technology experts, which concluded that high rents and labour costs in London were prompting many tech firms to relocate to the north.
More than 70 per cent of digital businesses are now based outside of the capital. Among them is Wilmslow-based mobile games maker Playdemic, co-founded by Paul Gouge, who also cites a lack of talent as a reason for ditching Shoreditch.
鈥淲e used to base ourselves in London but when we began our second company we couldn鈥檛 grow there 鈥� we landed a couple of contracts and literally couldn鈥檛 fill them,鈥� he explains.
鈥淲e had to come back to Manchester because that鈥檚 where all the people were. We also found it cheaper and our attrition rate was significantly lower.
鈥淲e bought into the whole London thing, we thought that was where we were going to be 鈥� then we picked up a couple of teams in Manchester in 2005 and they were the bedrock of that business.鈥�
However Manchester remains relatively anonymous on the west coast of the United States.
Garry Partington, CEO and co-founder of RealityMine – who will speak at 老九品茶Cloud’s half-day conference on big data at the 2016 International Festival for 老九品茶 –聽recalls pitching to US investors for the first time.
鈥淭hey鈥檇 ask: 鈥榃here is Manchester?聽 How close to London are you?鈥� Even guys we pitched to in London were asking 鈥榟ow long does it take to get there on a train?鈥� The US-based funds had no real idea.鈥�
That could be about to change with the opening of a Virgin Atlantic flightpath between San Francisco and Manchester Airport from the summer of 2017, giving the region鈥檚 tech community direct access to Silicon Valley 鈥� and vice versa.
Mike Gibbons, who has enjoyed a 30-year career in software consultancy and is best known for his involvement in Cheshire-based software development and integration services specialist Mobica, has seen the impact such infrastructure improvements can have upon a city.
鈥淲e set up an office in the Polish city Lodz, which didn鈥檛 have a strong technology base 鈥� it had one company with about 50 people working in it,鈥� he says.
鈥淰ery early on a delegation came to see us and asked which flight routes we wanted in and out of the airport 鈥� very practical, low-level things.
鈥淪amsung then came and joined us and now it is a tech city with thousands of jobs there.鈥�
Richard Law, the outgoing chief executive of identity intelligence specialist GB Group, says: 鈥淚f we want to make Manchester the number one choice for start-ups and scale-ups we need to create a positive force which sucks people in.
鈥淲hether they are people who graduate from the University of Manchester or from somewhere else, they are already coming to Manchester because it鈥檚 really friendly and it鈥檚 got a feeling of success.鈥�
Gouge is not convinced that the city is ready to position itself as the 鈥楽horeditch of the North鈥� just yet.
鈥溊暇牌凡鑕s are built on people, money and culture 鈥� you need all of those three components in the ecosystem to make it work,鈥� he says.
鈥淚n the mid-2000s we found that the people were here, but the money wasn鈥檛 here and the culture of people becoming entrepreneurs wasn鈥檛 here.
鈥淭here is movement in that direction 鈥� Barclays鈥� new Rise facility (in Deansgate) feels like Shoreditch 鈥� but we have to make sure the seed investment is there and the appetite to invest, alongside collaboration between companies.鈥�
Law agrees: 鈥淭here鈥檚 a lot of success here already. But there is scope to increase the amount of investment into these businesses through existing mentor-investor channels.鈥�
Manchester United legend Gary Neville and his business partner Ged Tivey, managing director of Relentless Group, are keeping a keen eye on the tech sector.
鈥淲e鈥檝e got money to invest in business,鈥� he says.
鈥淭he majority of these projects in terms of reshaping the city centre are property based and it鈥檚 me that is trying to bolt tech on to that because property and tech are going to play a big part in the future of Manchester.鈥�
Despite looking to Silicon Valley, Manchester cannot afford to wait for a halo brand such as Google or Facebook to boost its tech credentials.
鈥淲e can鈥檛 wait for the city council to have some kind of enterprise zone so that Google decides to come here,鈥� says Hugh Campbell, founder of investment banking firm GP Bullhound.
鈥淢anchester isn鈥檛 on the world map yet as a tech city, but that鈥檚 a 20-year journey to get people in the US recognising that.
鈥淲e have to push on with a lot of small initiatives. Connecting all these smart people together is a critical first step. I鈥檓 a big believer in the power of the network – if people are smart enough and entrepreneurial enough when they meet, they鈥檒l figure it out for themselves.鈥�
Digital agencies are numerous in Manchester, so it should perhaps come of little surprise that the business panel valued the power of building a brand to boost the city鈥檚 tech future.
鈥淭he brand aspect is incredibly important. Brands are for selling 鈥� you鈥檝e got to promote it, get it out into the media,鈥� says Gibbons.
鈥淥ther things will spin off from that, such as improved broadband or infrastructure, once you have a few more people and companies in the area.
鈥淭he clustering effect is important. Once it reaches a critical mass, I think it takes off by itself.鈥�
However Steve Purdham, chairman of 3rings 鈥� an Internet of Things enterprise that checks your ageing loved ones are safe 鈥� believes it works in reverse.
鈥淪horeditch and Silicon Valley didn鈥檛 have a brand until after the fact 鈥� people went there because it was cheap and they were around people that they actually knew and the culture grew from there.
鈥淭hey need to see people in their own peer group and say 鈥榟e was just a student six months ago and he鈥檚 now got a business that鈥檚 worth half a million quid鈥� 鈥� we shouldn鈥檛 forget that initial momentum is key to potential entrepreneurs taking that first step.
鈥淣inety-nine per cent of businesses in Shoreditch and Silicon Valley fail and you only hear about the 1 per cent that are successful.
鈥淏ut in creating that wave, we shouldn鈥檛 ignore the people who are on the journey now.鈥�