Tech start-ups offer better prospects than more failing retail

As property giants Hammerson and Westfield charge headlong into a £1billion battle for the rights to develop another temple to high street retailing, proud Purley resident JONNY ROSE puts forward an alternative vision for regeneration: the Silicon Valley of South London

Retail is dead, long live the start-up!

The unwelcome news last week that Allders of Croydon is closing comes after a line of other long-established businesses are preparing to flee the borough.

Surprisingly, the council and local government remain in thrall to major retail developers who are promising an economic and cultural Renaissance, if only they can build yet another soulless, identikit multi-storey shopping centre.

These retail developers are well aware of consumer shift from in-store shopping to online purchasing, but those in charge of the 2012-2013 “masterplan” for central Croydon will have long moved on, often perhaps with a golden handshake, when the borough is left with its empty and echoing “McMall” by the next decade.

Perhaps, then, it is time for those in charge of stewarding the borough’s fortunes to look to an area of the economy which is seeing promising growth: tech start-ups.

It’s time for Croydon to start again.

A tech start-up has many definitions but most simply is “a new business that is building a technical product”.

As high street retailers struggle, with stores such as Allders closing, new tech products and services are being launched, such as the iPhone5 this week and yesterday’s announcement of a 4G network. Where is Croydon positioned to move in on these 21st century businesses?

What it looks like a small group of excited coders working together to create something (perhaps a piece of computer software, a mobile application, a website business – the possibilities are, for now, endless) could potentially be profitable in the near future.

Across the country, councils are swarming to support a burgeoning confidence in the digital start-up sector. And why shouldn’t they?

The rest of the world has been capitalising on this wave of entrepreneurialism for the last five years as university leavers and more seasoned workers pursue an entrepreneurial urge to start their own businesses and build life-changing digital products.

The economic benefits of cultivating a start-up economy are myriad. Israel’s economy has been resuscitated by having what is claimed to have “the largest density of tech start-ups in the world”, according to Dan Senor, the co-author of Start-Up Nation: The Story of Israel’s Economic Miracle.

The nature of a tech start-up lends itself well to a cash-strapped borough such as Croydon. Nearly all start-ups are self-financed by their founders as they build their first digital products by “boot-strapping” until an investor is ready to lend money or the product is profitable in and of itself.

And where start-ups are, the money soon follows as venture capitalists scramble to finance the next Google, Facebook or PayPal. This tends to create a vibrant micro-economy of focused entrepreneurs, developers and investors. The response is a whole host of cultural and commercial offerings that rise up to meet the demands of these groups – art festivals, concerts, niche restaurants, collaborative workspaces and so forth.

Croydon as a home to start-ups in not hard to envision – just look at what’s been happening around Old Street and Shoreditch for the last six years.

Slowly but surely, the area has morphed from a bland concrete jungle to a hub of innovation to be reckoned with – home to more than 400 tech start-ups. In 2010, the government took notice of this particularly localised tech cluster and rebranded it “Tech City“. This has led to further investment in the area.

Croydon has all of the potential to emulate Tech City’s success and become a credible player on the European tech scene.

First, Croydon is already a formidable tech cluster of more than 600 digital, technical and creative businesses. The talent is here, it just needs to be consolidated.

Fairfield Halls showed in 2010 that it could draw 1,800 Drupal delegates to the area. As the council looks to invest more of public’s money into the venue, it would do well to encourage its potential as a conference venue for software companies and users.

Matthews Yard is a cafe and workspace established earlier this year that is attracting a strong following amongst Croydon’s musos, creatives and thinkers. It has everything in place to emulate the successes of TechHub – the popular Tech City workspace that births many of the areas best start-ups.

Old Town is slowly developing the chic atmosphere beloved of the hip developer types, and if you don’t look too closely, London Road has potential to have all the multi-cultural cool of Brick Lane.

The transport links from East Croydon to London terminals are – as many commuter will attest – often faster than travelling across London within Zone 1. East Croydon is also impeccably placed for those who want to escape the city for Brighton (another tech hub), Gatwick or the greener, more affluent areas of Surrey.

Most importantly, office space costs – which were already competitive – will be increasingly attractive to London companies which are feeling the rise in office space costs since Tech City’s rise to prominence.

(I explore these and many more reasons in my post here)

Who wants to be another Bluewater, when we can be a new Silicon Valley?

I am not entirely against Croydon developing a stronger retail core, however a new John Lewis will not:

Jonny Rose: retail is not the only answer for regeneration

Tech start-ups may not be the great panacea to end all of Croydon’s woes but they will go a long way to improve our borough in a way that trying to regain the dubious honour of being one of “Britain’s Top 10 Retail Destinations” never will.

  • Jonny Rose calls himself “the product evangelist” for the customer engagement platform Idio and runs social media courses for communities throughout the borough.
  • On Thursday October 4, at Matthews Yard from 8pm he will be discussing and outlining his plans for Croydon Tech City. All interested parties are welcome to come and participate. For more information contact jonnyrose1@gmail.com
  • Inside Croydon: For comment and analysis about Croydon, from inside Croydon
  • Post your comments on this article below. If you have a news story about life in or around Croydon, a residents’ or business association or local event, please email us with full details at inside.croydon@btinternet.com

About insidecroydon

News, views and analysis about the people of Croydon, their lives and political times in the diverse and most-populated borough in London. Based in Croydon and edited by Steven Downes. To contact us, please email inside.croydon@btinternet.com
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4 Responses to Tech start-ups offer better prospects than more failing retail

  1. Great article and having recently met Jonny and discussed briefly some of the ideas mentioned here, I completely agree with his vision and don’t see a reason why it shouldn’t happen.

    I’ve long thought Croydon has what’s needed to become a tech hub. Easy travel links to London and Brighton, close to Gatwick, unused office space in abundance and a small (although growing all the time) community of digital creatives.

    Places like Matthews Yard will feature heavily in this vision as a place where people can meet, discuss and imagine the next hot start-ups.

  2. jonathanrose says:

    Reblogged this on Jonathan Rose's Blog and commented:
    An article I wrote for Inside Croydon on Croydon’s viability as a credible player in the start-up scene. (optional)

  3. Political parties in Croydon are currently considering their election manifestos for the May 2014 Council elections. It would seem a good time to put into the melting pot any practical proposals as to what the Council should be doing to help make Jonny’s ideas a reality.

  4. Hi Jonny as a once Croydon resident myself I was interested to read your post. I have been operating in this area as an entrepreneur, consultant and corporate finance advisor for, well more years then I care to remember and would like to offer some feedback on your post.
    You stated “Croydon is already a formidable tech cluster of more than 600 digital, technical and creative businesses. The talent is here, it just needs to be consolidated.”
    Which on one hand is true, but can be a claim made by a lot of areas or regions around the country. Croydon’s transport links with London help but its close proximity to London are is also to its detriment. Business services for example such as Business link are better developed in other London areas or in central London. Another factor which can aid the consolidation you talked of is a regional body such as those in the northeast and Manchester again competition for financial support and business advisory services for the south east region cover a large area and does not appear adequate from personal experience. Funding from these sources is “clicky” and often requires connections within them prior to application if you are to be successful.
    The issues of consolidating talent often start with local government which has a grim record of accomplishment in this area and there has historically been very little in the way of arts or technology community development in Croydon (which is also targeted for cuts when money needs saving), as many friends have tried to find suitable premises here only to move to Lambeth or Camberwell. The number of companies developing in this area 600+ by your estimate you would have thought might have prompted action at a local government level but I can tell you for two decades it hasn’t yet!
    Another factor that aids in consolidation can be an academic community such as universities starting business park, incubators or think tanks again sadly absent from Croydon and the nearest being central London.
    The nature of a tech start-up lends itself well to a cash-strapped borough such as Croydon. Nearly all start-ups are self-financed by their founders as they build their first digital products by “boot-strapping”
    This in not always the case some technology start-ups need sizable capital to both develop, launch or float their products esp. technology that involves biotech. The companies you list (Facebook etc) are US based and grown in the USA which has a very developed structure for support and venture capital not to mention private investment. The UK on the other hand as the talent but often it goes overseas to access the support, which is so lacking in the UK. Things did improve during the dot.com boom for a while but recession has curtailed that.
    The best hope is to review your service or product area, see whom if anybody is suitable for a partnership or joint venture, and make an approach. It can be a long process with lots of doors knocking, emailing and dead ends but networking and ideas exchange are the best way. Going to experienced financial players can be like a stickle back swimming with sharks so it is wise to piggyback another more friendly shark if you can find one.
    Currently if the amounts are small, you would be better seeking out family, friend or current business associates. Also so the arts council can help art based projects again it can be a long wait and lots of paperwork and not all who apply get money.

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