Press release

PM announces £50m funding to regenerate Old Street roundabout

Major new investments from companies and government announced in Tech City.

Prime Minister David Cameron today announced a major Government investment in Tech City.

The Government will put £50m towards a visionary project to regenerate the Old Street roundabout, which will see it transformed into Europe’s largest indoor civic space, dedicated to start-ups and entrepreneurs in East London. This new civic building will host classrooms, co-working spaces and workshops equipped with the latest 3D printing technology, for use by both the local start-ups and the wider community.

These announcements from the Government were accompanied by a host of major corporate commitments to Tech City, including the following:

  • Microsoft is establishing a Technology Development Centre in the heart of Tech City as part of their commitment to the cluster, and will support local technology development, work to inspire innovation and provide expertise and guidance to those with new and innovative ideas. They will create packages of support for Developer Apprentices and are working on a new Apprenticeship to support young people in and around Tech City
  • Cisco, DC Thomson and UCL are opening IDEALondon, an innovation centre in Shoreditch to support the growth of digital and media companies, in a unique alliance between a world-leading research institution, a world-class information technology provider and an international media company. The facility will host up to 25 digital and media companies 
  • KPMG, the global professional services firm, announces the opening of an office in Shoreditch, with a dedicated team to support early stage technology companies. The team will provide advice for early stage tech companies looking to grow and flourish in the UK and beyond 
  • IBM will bring its entrepreneur programme to the innovative companies in Tech City. The IBM Global Entrepreneur programme provides access to technology, support and resources to help technology start-ups develop solutions for a smarter planet and grow their businesses
  • Alert Me, one of the UK’s fastest growing technology companies, is moving to Tech City. AlertMe develops technology that enables consumers to manage their home energy usage online or by smartphone, wherever they are. The move will establish in Tech City a centre of expertise on technologies promoting energy efficient consumption and the smart, connected home
  • Barclays and Ravensbourne are announcing a new creative partnership, that will see Barclays working with - and offering placements to - Ravensbourne students to bring technology and design to bear on specific business challenges
  • Skills Matter, who help a 35,000 strong developer community learn and share skills to write better software, is announcing an $5m investment by Beringea to provide even more opportunities for its community to collaborate with the world’s top technology experts
  • Salesforce.com, the enterprise cloud computing company, is working with the Tech City Investment Organisation to support a programme of events that will showcase the innovation and dynamism of Tech City start-ups.

Prime Minister David Cameron said:

Two years ago I set out my commitment to help Tech City become one of the world’s great technology centres. Today we are seeing it continue to grow and go from strength to strength - and that is down to the talented, creative entrepreneurs who have set up there. The UK is in a global race and I am determined that we as a Government continue doing everything we can to equip the UK to compete and thrive in that race. As well as backing the businesses of today, we are creating an aspiration nation and also backing the innovative, high-growth businesses of the future. That’s why we’re investing in creating the largest civic space in Europe - a place for start-up companies and the local community to come together and become the next generation of entrepreneurs.

The Mayor of London Boris Johnson said:

The 2012 Games were a catalyst for enormous change in East London, with a new quarter of the capital now primed to become the world’s most thriving centre for technology and innovation. The time is right to lay solid foundations in Tech City for London’s digital revolution, and this list of major new firms committing to the area is a testament to the confidence leading tech entrepreneurs have in the capital. Our new centre will provide not only a vital resource to nurture upcoming technology and creative superstars from around the world, it will drive huge investment into the capital and help create thousands of jobs.

Joanna Shields, incoming CEO of Tech City Investment Organisation (TCIO), said:

Tech City has become a thriving hub of tech-based enterprise and creativity. We have a vibrant community here full of exciting emerging businesses that are growing alongside some of the world’s most respected tech companies. We have the opportunity to take this momentum and make Tech City the global leader in tech innovation and the location of choice for start-ups and growth businesses.

Further announcements today included:

  • Brunswick is announcing a partnership with Central Working in Tech City to provide free communications advice to start-ups including monthly workshops 
  • Busuu, the world’s largest social network for language learning, is opening its new HQ in Tech City after closing a Series A investment round of €3.5 million from PROfounders Capital and private investors
  • Career Builder, one of the most visited online jobs sites in the United Kingdom, has announced its continued investment in the UK online recruitment industry by relocating its UK offices to Tech City
  • Cavendish Corporate Finance LLP is setting up a dedicated team of specialist tech advisers to provide advice on raising investment to Tech City companies, offering four seminars every year and one-to-one sessions 
  • ECNlive is partnering with TCIO to connect Tech City companies with investors in the City of London. ECNlive’s digital network will carry live news and real time information from companies within Tech City to financial institutions, media groups and technology companies across the capital
  • Lawbit, a new start-up based in Tech City, is launching its online legal service for SMEs, providing simple, affordable contracts and practical legal advice delivered virtually
  • Research In Motion is announcing a partnership with Skills Matter, Europe’s largest provider of agile training and events. Launching with a BlackBerry 10 developer event in January, the partnership includes the establishment of a test and porting centre for developers, working with the start up community to demonstrate the use of mobile in building and growing businesses, as well as a range of events aimed at illustrating to the developer community the power and potential of the BlackBerry 10 platform
  • The Trampery, Shoreditch’s first co-working space, is opening four new sites across Tech City with an extra 54,000 sqft. By the end of 2013, they’ll provide space for 600 fulltime members

According to the Tech City Map, there are over 1300 companies in the cluster. In the first nine months of 2012, the TMT sector acquired almost 1 million square feet in the City, an increase of 39% on the same period last year - and more space than the financial and insurance sectors combined.

Companies from all over the world are coming to Tech City. Here are just some of the companies who have set up here in 2012.

  • Yammer opened its first international developer centre
  • Google Campus opened a seven-storey centre for the tech and media community in East London
  • Amazon opened a development centre
  • Qualcomm Europe is working with Renault and Delta Motorsport on Qualcomm’s London Electric Vehicle
  • Charging trial taking place in Tech City and other parts of London. Chargemaster plc, a British start up, will be installing the charging stations
  • Vodafone are opening xone, a new technology lab and incubation centre
  • Intel launched the Intel Collaborative Research for Sustainable Connected Cities in partnership with Imperial
  • College London and University College London
  • Silicon Valley Bank opened its first UK branch
  • General Assembly opened, hosting regular events and training for London entrepreneurs and start-ups
  • Central Working, in partnership with Barclays, set up its second club
  • SPACE Studios, in partnership with Bloomberg and the Olympic Park Legacy Company opened The White Building
  • The Hoxton Mix, a co-working space aimed at freelancers, small startups and agencies is expanding its offering, opening a new site opposite Google Campus
  • Companies such as Uber and HotelTonight launched

A number of companies in Tech City secured investment in 2012: Makielab, Lyst, Huddle and Songkick are among the companies who raised funding in the last year

The Coalition Government has introduced a number of policies to make the UK the first choice entrepreneurs and investors:

  • Seed Enterprise Investment Scheme (SEIS): introduced in April 2012, SEIS is the most generous early-stage tax break in the world, providing 50% tax relief for the first £100,000 seed investment. For the 2012/13 tax year, this investment is not liable for capital gains tax
    Corporation Tax in the UK is one of the lowest in the G7 and the lowest amongst the EU members of the G20.
  • Currently 24%, it’s due to come down to 23% by 2014
  • R&D Tax Credits: in April 2012, the rate of R&D tax credit for companies with fewer than 500 employees increased to 225%. Companies carrying out research or development work in technology are entitled to tax credits, paid as a cash sum 
  • Patent Box Scheme: coming into force in April 2013, the Patent Box scheme lowers Corporation Tax on the earnings from a company’s own innovations, a key source of income for many start-up tech companies
  • Changes to IPO regulations: in September 2012, the Government and the London Stock Exchange announced a possible fast-track for companies to public listing, enabling high-growth tech companies to list in the UK
  • Open Data: the UK is now a world-leader in open data and this year the Open Data Institute has been set up to exploit the economic potential of open data and help incubate start-ups
  • Tax relief for the creative sector: announced in the March 2012 Budget, corporation tax relief for the animation, high-end television and videogames industries are being introduced in April 2013

External site: Tech City

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