As part of our ongoing series of weekly features we asked our expert panel and contributor network;
Can South Wales Challenge London as a Tech Hub?
Our panel's thoughts can be found below, but if you would like to contribute to this feature, or any of our future features, please contact [email protected]
Avril Lewis | Managing Director
We are an ambitious country, with a motivated and talented workforce that has attracted multinational tech companies and enabled a new generation of start-ups to grow. The enabling technologies developed here drive all aspects of our economy and society. They’re also recognised as being key for Wales’ future economic development.
Our industry’s successes must be celebrated and broadcasted to audiences outside of Wales, which is why the ESTnet has created the annual Wales Technology Awards and is a founding partner of the Wales Festival of Innovation, alongside Innovate UK and the KTN. We also need to play to our strengths; our close-knit, yet diverse and dynamic industry needs to collaborate. The Economic Action Plan highlights that decarbonisation, automation, artificial intelligence and other forms of digitalisation are transforming industries, and it recognises the opportunities of the data revolution for collaboration across sectors.
What is key to sustaining and accelerating our sector’s future growth, is ensuring Welsh tech companies are properly supported to scale, accelerating the commercialisation of Welsh research and development, and inspiring the next generation to join us.
Debbie Garside | CEO
Let’s put this in perspective, London’s Tech Hub currently employs 1.25 million people in 187,000 companies with a turnover of £292 billion that grew 15% last year (figures taken from techmap.london). I don’t think Cardiff or Swansea are going to be challenging these type of figures anytime soon. However, where Cardiff could compete is with lower overheads and, potentially, lower salary costs for mid-range skilled tech staff. The average cost may be £43k but a good developer will cost substantially more if you want to attract the right calibre of candidate – and these are few and far between currently.
The biggest draw for Cardiff is in lifestyle and work/life balance. This is where Cardiff can truly compete in my opinion. Lower housing costs but all the trappings one would expect of a city are a significant draw for some as is a safe family environment. So focus on the opportunities and benefits to individuals of moving to Cardiff and you will see a significant rise in the talent pool. This rise in available talent will in turn attract some of the medium size and larger companies to set up stall in Cardiff. Then you have the true beginnings of a Cardiff Tech Hub. Couple this with the announcement of 2,500 new homes (more needed!), the planned improvements to city/valleys transport and the new Cyber Security Centre of Excellence at Cardiff University and Cardiff has the beginnings of being an attractive destination for Tech companies. But a competitor to the London tech Hub… well, never say never!
RPS Technology Solutions
Ron Griffiths | Managing director
I believe the Welsh tech industry’s substantial growth is a result of several factors, but one that stands out is the linkage to the higher education establishments throughout the principality. Digital enterprises such as Digital Media and Marketing, Web-design, Application Development and changes in Voice Technologies are all well supported across the regions Universities. This coupled with a great investment approach by Entrepreneurs, Venture Capital and now the Development Bank of Wales are allowing younger, tech savvy individuals to create start-ups in these arenas.
To further develop this sector, I believe a Welsh Government Tech Specific Marketing Fund for promoting such companies should be ringfenced for these SMEs ensuring they are given the best opportunity to develop. Prioritising this over major inward investments projects which appear to have limited timelines would accelerate these businesses’ growth, market share and employee numbers.
Compound Semiconductor Applications Catapult
Stephen Doran | CEO
Many of the tech companies operating in South Wales will be developing devices or services related to future megatrends like 5G, the Internet of Things (IoT), artificial intelligence (AI), virtual reality (VR) and so on. Compound semiconductors (CS) will form the basis of future technologies enabling those megatrends to become reality, and South Wales has the potential to become a worldwide hub for CS. There are vast opportunities for Welsh companies, both directly operating in the CS market and in the wider tech industry, to exploit advances in CS technologies.
South Wales has a unique advantage in that the world’s first cluster for CS has been established here. It will allow Welsh businesses the chance to access and collaborate with organisations at every stage of the supply chain, and easy access to incorporating cutting-edge CS tech into their own products. CSA Catapult, a key pillar of that cluster, has been created to help support UK companies explore compound semiconductors, incorporate them in their systems and devices and gain access to the expertise and facilities that would have previously been out of reach.
We envisage that some of the tech world’s most innovative companies, each with their own technology and digital requirements, will be attracted to the unique support available here and will relocate or do more business here in Wales as a result.
Alys Carlton | Partner
Business growth in Cardiff has seen a lot of hype lately, particularly because of its array of amazing start-ups. These have not just caught the attention of those in the industry, but have the potential to make real, impactful changes on a global scale.
Cardiff start-up Amplyfi, which uses AI to harvest information and data from the entire web and turn it into business intelligence, has forecasted turnover of £50m by 2021. Considering it was only launched in 2015, this is incredible. And it’s not the only Cardiff start-up making waves. DevOpsGroup is transforming the IT departments of some huge organisations with its software, WeBuildBots is assisting clients with their chatbot solutions quicker than we can type a question, and Doopoll’s engaging platform has changed the way organisations deliver polls.
Just last week, The Sunday Times published an article drawing attention to these Welsh businesses and how they could be on track to be the country’s first unicorn. Achieving unicorn status is no mean feat (there’s only 279 in the entire world), so the fact that people are talking about the first to emerge from Wales is a huge compliment to the strength and stability of the Cardiff start-up sector.
National coverage of these successes affirms the opportunities here, in addition to inspiring future local talent. And, as we’ve been lucky enough to be part of all these market-leading companies’ journeys, we’ve seen the potential and achievements in Cardiff first hand.
Traditionally, cities like London, Manchester, Edinburgh, and Bristol have been the obvious UK locations for a tech start-up to base itself. But, the availability of funding within Wales is a key reason for these new start-ups to now choose Cardiff as their HQ. Development Bank of Wales alone has invested over £600m in Welsh businesses since 2001. Private equity firms are also starting to cotton on to this trend – becoming more present in the market over the last 18 months, with both LDC and BGF opening offices in Cardiff. We hope and expect more funds to follow suit.
The success of existing businesses will hopefully act as a catalyst for the sector’s continued growth in Cardiff and the rest of Wales. If you would like to know more about the local market and potential investment opportunities, please get in touch.
Abigail Moses | Company Director
When it comes to the digital marketing space, South Wales can certainly compete with London. Due to business rates and salaries being lower in Wales, creative agencies have the ability to offer high-standard solutions at a fraction of the price of their London counterparts. In addition, we are harvesting some wonderful tech talent here in South Wales, with Wales’ educational institutions constantly creating new courses to encourage a tech-focused South Wales.
We also have access to a string of new Welsh Government grants and incentives that will map the way for technology startups in Wales, especially in the areas of AI and automation.
This was highlighted by last month's announcement, seeing Welsh Government reveal details of the first Welsh Government Digital Action Plan; a plan that lays out our Government's commitment to improving its own digital service.