Britain’s Technology Industry – A Winner For International Investors and Entrepreneurs
A decade ago, Britain was looking across the pond, envying the dominance of Silicon Valley in the global tech market. How times have changed. Over the last ten years, Britain has grown into a technology hub – holding its own on the international stage and providing strong returns for local and international entrepreneurs and investors.
Global leader in Fintech
Take financial technology (Fintech). It is booming in the UK with £3.8 billion of investments made in the sector between July 2015 and January 2016. Fintech turned over £6.6 billion revenue in 2015 and has a workforce of over 60,000 employees
One of the biggest winners in this industry is digital first, mobile only banks. Made possible by the Bank of England in 2013 lowering the capital required to set up a new bank, the tech challengers are unencumbered by the public’s distrust in bankers following the 2008 crash. They offer the instant access to information consumers now demand, including real-time balance information, deep-dive spending data, biometric security, open API integrations, no foreign exchange charges, simple money transfers and artificial intelligence layering for more predictive banking.
One of the big players in digital banking is Atom Bank, whose headquarters are in Durham. It positions itself to appeal to the young and tech-savvy, who are tired of the traditional UK banks.
But digital banking is not the only market providing opportunities for investment. Take Transferwise, a peer to peer money transfer platform that saves business owners paying inflated exchange rates and bank fees when transferring money across international borders.
International entrepreneurs can also count on strong UK government support for the Fintech industry. In April 2016, the Economic Secretary announced that the UK will:
- establish a FinTech panel and delivery support function which will set an overarching FinTech strategy for the UK and monitor and drive forward FinTech initiatives
- create a professional services information hub for FinTechs, making it easier for them to source legal and accountancy services, and access practical and cost-effective basic services
- alongside UK Trade and Investment will establish ‘FinTech Bridges’ with priority global markets, helping UK FinTechs to expand internationally
Outside of Fintech
FinTech is only one sector of the UK technology market. London is playing a crucial role in the success of the industry, attracting global entrepreneurs and investors by the thousands.
The number of companies in London’s digital technology sector has grown by 46% since 2010, employing over 200,000, a 17% increase on five years ago, according to Oxford Economics.
By contrast, overall Employment in the UK has risen by 7.8pc. Digital technology now accounts for 3.5% of all jobs in London. There are now 40,000 or so digital tech firms in the capital, with many based in Westminster, Tower Hamlets, the City of London and Camden, and with output expected to grow by 5% a year over the coming decade.
Government initiatives and support is not the only driver behind the huge growth and potential the UK tech industry offers investors. A highly-educated workforce, access to labour from the EU, access to the single market and the close links with global investment banks are all factors that have assisted the tech industries astonishing success over the last ten years.
Tech City – the support base for tech entrepreneurs
The UK provides unrivalled support for entrepreneurs in the tech industry via Tech City, set up by former Prime Minister, David Cameron. The organisation aims to help grow the UK’s digital economy by offering support in areas such as digital skills, smart capital investment, infrastructure, international development and leadership.
According to its website, it does this in three ways:
- By running targeted programs to fill market gaps across the tech industry, such as Future Fifty, which supports the top-50 growth stage digital companies in Britain;
- assisting the UK Government in creating the right policies to support the tech industry; and
- setting up local and international events to promote the British tech industry and provide networking and promotional opportunities.
Tech City is also able to endorse applicants who apply for the Tier 1 (Exceptional Tech Talent) Visa. With the ability to endorse 200 applicants per year, the organisation is looking for extremely talented individuals who will make a clear contribution in ensuring Britain remains one of the global tech hubs of the world.
The right infrastructure
Not only does the UK provide open access to Europe, it has the infrastructure required to make launching a tech start-up easy. London now boasts an increasingly successful support infrastructure, including venture capitalists (VCs) such as Index Ventures, accelerators, incubators and workspaces. Outside London, a number of areas - and not just Cambridge - are also successfully attracting tech start-ups. These include Milton Keynes and Manchester, which, alongside Cambridge, offer an excellent standard of housing and schools to make settling into the UK as an international investor or entrepreneur easier.
How to make it happen
The first step to taking advantage of the opportunities in the UK tech industry as a foreign investor, entrepreneur or exceptional talented person is to find out which visa will suit your commercial ambitions best. You can choose from a Tier 1 (entrepreneur) Visa, Tier 1 (investor) Visa, Tier 1 (Exceptional tech Talent) Visa or a Tier 2 (General) Visa.
An experienced Immigration solicitor can assist you by examining your situation and working out the best UK entry route for you and your family.
OTS Solicitors is one of the most respected Immigration law firms in London. By making an appointment with one of our Immigration solicitors, you can be assured of receiving some of the best legal advice available in the UK today. We will assist you with all aspects of applying for entry into the UK if you are working or investing in the technology sector.
If you wish to discuss any of the points raised in this blog, please phone our London office on 0203 959 9123.