It may be best known for cider and clotted cream, but there is a revolution going on in the South West of the UK with hi-tech companies springing up at a rate of knots.
While it might be fanciful to describe this as the fourth industrial revolution, there is no doubt that it is digital innovation which is most likely to drive our future economy.
Although it may well appear an unlikely scenario, the South West seems to be leading the way. There are a number of reasons for this, including lower start-up and running costs and wholly realistic salary expectations.
Indeed, Tech South West, the organisation that showcases and champions the region’s fastest-growing sector, reports that there are 10,900 technology companies in the region, employing more than 135,000 people.
In 2017 there was a 42 per cent rise in the number of start-up hi-tech companies in the South West. While it must be said that year-on-year rises were recorded in every region, it is no less encouraging.
The South West referred to on this occasion includes Bath, Bristol, Cornwall, Devon, Dorset, Gloucestershire, Somerset, and Wiltshire.
Technology, of course, goes hand in hand with innovation and with innovation, there is an obvious need for investment.
There are many sources of investment – traditional loans at current low interest rates, private equity funds, and venture capitalists.
The UK’s tax regime allows small to medium enterprises to claim tax rebates on Research and Development (R&D) spending. Companies such as GovGrant have long and successful records in aiding SMEs to claim tax rebates. Such companies have an average claim of £61,000, equating to 33 per cent of the initial R&D spend.
This can go a long way towards funding the innovation so vital to stay one step ahead of the competition and build foundations for a sustainable business. It is clear that while rewards are being claimed, there is potential for much more, with many businesses remaining unclear as to exactly how much is available to who and for what.
In general terms, while it is all very well launching a new tech business, the challenge is in firmly establishing it and then growing it. For the South West, where 503 software development and programming businesses were incorporated in 2017, that means attracting inward investment and tempting top talent to a region not necessarily yet well known for hi-tech industry.
The obvious attractions of a good quality of life and a beautiful area in which to live and work may or may not be enough to persuade high salary, city-centric types to abandon urban living for the countryside and new opportunities. But there is another way.
Excellent universities in Plymouth, Bristol, Exeter, Bath, Falmouth and Bournemouth, among others, are developing exceptional talent and disgorging hundreds of hungry, technology-minded graduates every year. It is therefore incumbent for schools and colleges across the area to recognise that pupils and students need to be equipped with modern skill sets to progress in today’s digital age.
This is vital because as clients demand more and better intelligent solutions to link different technologies across multiple business platforms, the teams working on them will need to become more specialised themselves. Thus while acquiring skilled and talented members of staff will always be a challenge, there is certainly great hope that tech industries will be well served by emerging young people.
Undoubtedly, the position is more positive than, say, the construction industry where an ongoing upper end drain of experienced, mature talent is not being replaced by younger incomers.
Indeed, the South West hi-tech sector is thriving to the extent that a Tech South West survey reported 85 per cent of companies being positive about their prospects in 2018 and two-thirds optimistic that business will be better than last year.
The South West really is a hotbed for hi-tech companies covering a far-reaching range of businesses from web design, video and marketing to cyber security, artificial intelligence and stand-alone SMEs. What they all have in common is innovation, ambition, a spirit of adventure and a willingness to be different. We are seeing more flexible and dynamic disruptor firms emerging to challenge the status quo.
And as the hi-tech industry sector continues to grow, its infrastructure needs to maintain the pace – ever-increasing broadband speed and availability of internet connectivity is vital for seamless integration.
In a sense, the world is evolving, and fragmenting, more quickly than ever before and business must too evolve and progress to take advantage. Standing still is not an option and will leave companies languishing on a dusty road to nowhere.
Phrases such as high-quality tailored solutions, analytics, data capture, enhanced forecasting, robust digital strategy, content creation, affiliate marketing, conversion rate optimisation, data mining, straddling conventional and digital channels, user persona and build perspective may sound like some sort of business lingo bingo, but they are all becoming commonplace in our everyday lives.
Whatever the choice of phraseology, it is clear that the South West’s tech industry remains vibrant and fast-growing.
