Discover Edinburgh’s very own Flat White economy, a tightly knit community pushing the boundaries of the city’s tech landscape.
The flat white economy, so named after the drink of choice of its inhabitants, describes the sector centered on media, tech and creative businesses and has been accredited with driving much of the post financial crisis growth in Britain since the recession. Much like a lot of growth in the UK, the movement began in London, with a great number of start-ups setting up in areas such as Shoreditch where rent was cheap, and set up easy. Discussion of this sector, particularly the tech aspect, need not be focused solely on London though. Research by KPMG last year found that the tech-sector accounts for one in every eight businesses in Edinburgh, with the city boasting the largest technology cluster outside of London. With Edinburgh’s universities producing 1200 computing graduates each year, this is certainly an area with scope for future growth.
Edinburgh’s Tech Landscape
Edinburgh possesses a wealth of tech firms, from industry giants to emerging start-ups. At the top end of the scale are so called ‘tech unicorns’: businesses valued at over $1billion. In Skyscanner and FanDuel Edinburgh boasts two of only four UK unicorns outside of London. The presence of these large firms is pivotal for the wider tech industry. They provide an illustration of the possibilities for firms entering the industry and act as a nucleus around which a community of smaller firms may emerge. Recent examples of startup success in the city include Mallzee, an online shopping app, and Appointedd, an online scheduling solution. Larger firms also present investment opportunities for start-ups. Skyscanner’s recent takeover by Chinese travel giant Ctrip brought global attention and investment to the city. Following this investment, Skyscanner CEO Gareth Williams, amongst others, then invested further down the chain, into some of Edinburgh’s many start-ups. The emergence of such a community, with interlinks and investment between firms, has been central to the continued success of Edinburgh’s technology industry.
A Natural Advantage
What sets Edinburgh apart from other cities is the collaboration between firms. This has been facilitated by the likes of CodeBase, the UK’s largest tech scale up incubator, and one of Europe’s fastest-growing tech hubs. CodeBase provides a space in which tech firms can access investment and mentorship, as well as interface with other firms in the city. Other schemes such as Creative Edinburgh ensure startups aren’t working in isolation, and are able to use their individual skills to create an output greater than the sum of their parts. These bodies can build links with firms outside their own industry more easily than would be the case for firms working alone. For example CodeBase and PwC’s recent partnership provides the latter with a wealth of different skills to call upon, all through one collaboration.
This ability to collaborate is inherently linked to Edinburgh’s geography, and illustrates one of the ways in which the city boasts a competitive advantage over London. The compact nature of the city lends itself to the creation of a collaborative hub, as well as facilitating an easy transition between work and leisure not always possible in London. Nowhere is this better demonstrated than at Quartermile – home to both of Edinburgh’s aforementioned unicorns. The Quartermile development has created a tech powerhouse not replicated anywhere else in the UK, and represents a model of planning that continues to attract firms to Quartermile and Edinburgh.
Additionally, Quartermile is strategically placed next door to the university – another key factor in the success of Edinburgh’s tech sector. Between 2011 and 2016 alone the university supported the start up of over 180 new businesses in the area. It is suggested that Scotland’s reduced tuition fees has helped develop the atmosphere of entrepreneurship that saw Edinburgh named as British Entrepreneurial City of the Year. By not burdening highly trained individuals with large debts, the city encourages more graduates to take chances with a start-up, rather than seeking the security of employment. At the heart of the university’s contributions is the School of Informatics, Europe’s largest informatics centre and the top UK centre for research in the field.
The Evolution of Edinburgh
From a city dominated by finance, to one where the technology sector takes up more office space than any other, what is the future of Edinburgh’s economy? Firstly, a coming together of old and new can spark yet more growth in the UK’s second most prosperous city. Fintech is a rising area of the UK economy, and given its strength in technology and financial services, Edinburgh is well placed to exploit this. We are already witnessing collaboration in this area. PwC’s recent partnership with CodeBase is driven by the former’s desire to adapt to the future and its clients needs through fintech. Edinburgh is the largest fintech centre in the UK outside of London, and with its offering of a compact, collaborative city packed with highly skilled graduates, Edinburgh can continue chipping away at the dominance of England’s capital.