Technology Industry in London

With a week long series of events held each summer in the UK's capital that are devoted to the technology industry, there can be little doubt that London is firmly behind the development of this sector. These events are put together under the auspices of the Mayor of London along with some established players in the capital's technology industry. The idea is to bring together technology experts with business leaders from around the world in order to highlight the latest innovations and to mark out the city as one of the leading places in the world for technology development.

For some time it has been the great financial institutions of the City of London which has driven the capital's growth, but for the last few decades nearly all of the trades and services that are offered in the city have been conducted using the very latest technology, principally over computer networks. Therefore, technology and innovation are at the forefront of what London is offering the world as a global city. However, the technology sector is not just a service industry to the financial service giants - it is a much more important part of the economy of the capital in its own right.

Technology - The Capital's Future?

According to some academic research undertaken in the summer of 2014, the technology sector in London will add no less than £12 billion of value to the city's production in the coming decade. That is a truly huge figure compared to many other industry sectors which ply their trade in the capital. By 2024, it is expected that an additional 46,000 people will be working in the field of technology - many of them in niches that have yet to be developed or even invented. For many global technology brands, such as the internet giant Google for instance, this really cements London's commitment to becoming one of the leading technology cities around the world. In the area around Old Street, just to the north of the financial districts which have traditionally done so well for the city, the new area of TechCity can be found. Already home to many technology firms specialising in satellite technology, switching and routing equipment and software development, some of the big global brands are setting up shop. This means that start-up technology companies are now used to rubbing shoulders with the big companies - with all of the cross-fertilisation of ideas that it brings. Further sites of this nature are planned in East London, with one already under way on the former site of the Olympic Games, held in the city in 2012.

You may be forgiven for thinking that London's reputation for its technology industry is strong on a European-wide basis only, because so many of the firms now choosing the city originally come from America. However, this may well be an underestimation because many in the sector now see London as a place which is outperforming other centres of technology-based excellence like Silicon Valley in California. Indeed, the latest figures suggest that there are more employees working in the financial technology sector in London than either New York or San Francisco. According to Joanna Shields, the chairwoman of TechCity, over the last few years the technology sector in London has played a crucial role in bringing about the economic recovery of the country as a whole, making up to 27 per cent of new jobs in the city.

The popularity of the Shoreditch / Old Street locations with new and established tech firms means that commercial property values have risen steeply and are projected to continue to do so in the next few years until more business accommodation is developed to serve the industry in this area. Freelancers and new start ups can find shared space and hot desking opportunities at incubators and even in re-purposed cafes, while those seeking a more mid-level work environment are currently opting for serviced office space before moving on to pre-purchasing or pre-leasing the little space that is due to hit the market in the next few years.

Investment in Technology Start-ups

London press reports in the autumn of 2014 stated that London-based technology start-ups attracted unprecedented levels of investment over the course of the previous year. In fact, venture capitalists bet on new technology companies in the UK capital again and again so that - taken as a whole - they received in excess of $1 billion in new funding. This means that the lifeblood of innovation, capital investment, is certainly being met and that investors view the city as one that will produce the major digital companies of the future.

The latest research suggests that fledgling technology firms raised more from venture capital firms over the first three-quarters of 2014 compared with the same figure in 2013. Indeed, the trend was all the more remarkable because it showed an upturn of about a third compared with the previous year - and ten times the amount raised in 2010. Of course, the increase of capital flow into start-up technology companies must be seen in a wider context. After all, both Berlin and Stockholm which are competitor cities to London have seen upturns in the amount of investment their start-up technology companies are getting, too. However, it is also fair to say that London is leading this increase in interest and that the city's share of the European technology-based investments outstrips that of any of its competitors as things currently stand.