UK BAA Keynote November 2016

Gerard Grech CEO, Tech City UK November 2016 @TechCityUK @gerardgrech

Developing a Agenda: -‐  National context

-‐  Success stories

-‐ 4 key drivers of digital economy growth -‐ Why is this all so important?

Who are we? 1. programmes | 2. policy convening | 3. advocacy

-‐ Founding stage -‐ 12,000+ in training -‐ 50% want to start their own business

-‐ Later Stage -‐ $3bn raised -‐ 10 acquisitions

Most comprehensive annual analysis of the UK’s Digital Tech Economy

-‐ Mid stage -‐ Mentorship program -‐ £200M+ raised

Accelerating digital growth across North of England

Concierge service for fast-‐growth US tech companies

Dedicated Visa Scheme for hiring digital tech talent

Best practice mini reports to share learnings

3 British Digital Tech Economy is growing steadily Tech Nation 2016 Report

£161Bn

Total Digital Turnover*

+32% than the wider UK Economy

Growing

Source: Tech Na.on 2016 Report, Tech City Uk/Nesta *based on 58K iden.fied Digital Businesses

@techcityuk @gerardgrech

Recent OECD/McKinsey report (Aug 2016) puts UK in top ranking on digital share of economy; a great place to build form

Acquired by News Corp in 2015 – example of traditional industries being transformed by disruptors

Acquired for £114million

News Corp harnesses Unruly to: •  Bet big on mobile and video

-‐ launch a new vertical video ad format purpose built for mobile audiences

•  provide new insights to its adver.sers and improve ad engagement

400 employees in: New York, Edinburgh, Glasgow, Orlando &

Los Angeles

Fanduel Web-‐based fantasy sports game and the largest daily fantasy sports company in the industry. As of April 2016 most U.S. states consider fantasy sports (including daily fantasy sports) a game of skill and not gambling.


Finance & Fintech: Nutmeg Nutmeg provides low-‐cost online wealth management makes investment expertise accessible to millions of people who usually couldn’t afford advice


MagicPony London based Artifical Intelligence company – uses neural networks – systems that are designed to think like human brains

Twitter acquired Magic Pony Technology to provide expanded data for images, used to: •  enhance a picture or video taken

on a mobile phone •  help develop graphics for virtual

reality or augmented reality applications.

June 2016 $150 million

deal

Deliveroo Raised another $275 million in funding, a Series E investment -‐ values the company at around $1 billion. The investment will go into growing its service in both new and existing markets & investing in its new initiatives -‐ includes a new B2B remote kitchen service, RooBox -‐ gives restaurants access to delivery-‐only kitchens in key locations

Live in 84 cities

Facing heat from competitors -‐ targeting the higher end of the prepared food market – rivals include Uber, which has stormed into Europe with UberEATS, as well as others like Delivery Hero, Just Eat, and Amazon

Farfetch Platform for luxury brands and boutiques from around the globe, everywhere from Tokyo to Toronto, from Milan to Miami. Farfetch was founded in London in 2008 by the Portuguese entrepreneur José Neves and now has offices in nine countries globally.

TransferWise Banks and other providers oVen add markup to their exchange rate -‐ TransferWise transparently displays its fee upfront and deducts it before conversion

Latest funding values TransferWise at £750 million

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The impact: >40% of European ‘Tech Unicorns' ($1bn+) are in the UK


47 European Unicorns

19 UK

Unicorns

3. Rich ecosystem & connected nation

1. Smart capital

2. Strong business & policy environment

4. Creative talent & critical mass of expertise

4 Key growth drivers powering the UK’s digital economy

1. More funds now exist, opening up new opportunities and securing the growth potential of talented teams

Selected Recent UK IPOs

$552M Gross Proceeds

$3,341M Gross Proceeds

$2,042M Gross Proceeds



2,074 2,010

2,536

590

1,672

638 36

4

318

146

29

0

500

1000

1500

2000

2500

3000

LSEG NYSE NASDAQ SGX HKSE

# of

Com

pani

es*

Source: Capital IQ as of 26th of May, 2016 Source: Capital IQ as of 26th of May, 2016

London Stock Exchange is a hub for international businesses

Source: Bloomberg 2015, EY Tech Trends 2016

Domestic

International


London/UK has a strong investment/VC eco-‐system In 2015, 5x more VC investment than 2010. >30% of all EU VC money.

UK companies consistently raise >30% of all European VC money

Source: PicthBook/EY May 25th 2016, CB Insights/L&P

UK VC-‐Backed Investment Activity Top Deals & Cities, Q1’16


$5B

$13B

$12B

$7B$7B

$5B

$3B$2B

$0B

$2B

$4B

$6B

$8B

$10B

$12B

$14B

2016)YTD2015201420132012201120102009

Total-VC-Capital-Invested

UK Germany France Israel Russia Sweden Switzerland RoE

82. End-‐to-‐end policy conditions for tech growth are ripe Regulatory environemnt is key

>£2.75 Bn

latest market

Cap

>£1.1 Bn

latest market

Cap

4. Corp Tax: 17% (joint lowest in the G20)

1. Seed Enterprise Investment Scheme & EIS: 50% relief on

capital gains tax

3. Visas: Entrepreneurs’ Visa, Tech Nation Visa

2. R&D Tax Credits: fueling innovation

5. London Stock Exchange high growth segment @techcityuk

@gerardgrech

UN E-‐Government Survey 2016– UK ranked No.1

•  E-‐Government development Index ranked UK No.1

•  E-‐Participation index ranked UK No.1

•  E-‐government to provide public services through one stop-‐platforms & online transactions

•  Ensures that public institutions are more inclusive, effective, accountable & transparent

•  Drive towards Open data for public information & scrutiny

3. Rich Ecosystem: >60 UK tech accelerators, >100 co-‐ working spaces & 50+ tech business support orgs


Edinburgh


hAps://vDme.net/

Liverpool


Bristol


Bradfield Centre Cambridge


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+2.8x 1.56M UK Tech Jobs Jobs growing

41% In non-‐digital industries like educaOon & Finance

Faster than the wider economy

£50K

Average UK Tech salary

+36% Higher than UK average salary

4. The UK’s tech talent pool is growing fast

Source: Tech Na.on 2016 Report, Tech City Uk/Nesta


8The pool is deep & extensive, with international HQs, world class institutes & top research universities

International & EU HQs Technology Institutes World – Class Universities

38 ROUNDS

£1.5 Bn RAISED

+ £1.22 Bn RAISED FROM 5 IPOs

+ 10 ACQUISITIONS

In the last 20 months… Good conditions create great companies


Why is all this so important? We need to create a sustainable ecosystem and future-‐proof the economy and controibute to making it more resilient & productive.

InsDtutes UniversiDes

Govt. Dept. (naDonal & Inter).

Local AuthoriDes

Investors Entrepreneurs

Corporates

Incubators

Accelerators

Stock Exchanges

Colleges

InternaDonal hubs


Developers

|

Thank you for listening. Gerard Grech, CEO, Tech City UK Visit our website: Techcityuk.com Follow us on Twitter: @techcityuk @gerardgrech

UK BAA Keynote November 2016

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